Posts with «company legal & law matters» label

SEC opens investigation into Activision Blizzard's workplace practices

The Securities and Exchange Commission has opened a “wide-ranging” investigation into Activision Blizzard, per The Wall Street Journal. The outlet reports the SEC recently subpoenaed the company and several executives, including CEO Bobby Kotick. The agency has asked the publisher to share a variety of documents, including correspondence Kotick wrote related to complaints of sexual harassment tied to Activision employees and contractors.

Helaine Klasky, a spokesperson for Activision Blizzard, told The Journal the SEC’s investigation involves disclosures the company made regarding “employment matters and related issues.” The agency reportedly hopes to find out whether Activision properly disclosed those problems, as well as whether those disclosures should have been shared earlier.

An SEC investigation adds significantly more regulatory pressure on Activision Blizzard. In July, the California Department of Fair Employment and Housing (DFEH) sued the company, accusing its executives of fostering a “frat boy” workplace culture. According to the initial complaint, only 20 percent of all employees at Activision’s Blizzard Entertainment unit are women, and they’re consistently paid less and overlooked for promotions. One month later, DFEH expanded the scope of the lawsuit to include both workers and employees. It also accused the company of using non-disclosure agreements to interfere with its ability to address the workplace violations that had happened at the studio.

India says Google abused Android dominance

Google stifled competition and prevented the development of Android rivals in India, the country's antitrust regulator has decided in a report seen by Reuters. In 2019, Competition Commission of India opened a probe into whether Google abused Android's dominance in the market where devices powered by the OS are prevalent. In its report on the probe's findings, the regulator wrote that Google flexed its "huge financial muscle" to reduce manufacturers' ability to develop and sell devices running Android forks. 

In addition, the commission said that Google requiring manufacturers to pre-install Android apps is an unfair condition to make in exchange for access to its mobile OS. It violates India's competition laws, the report reads. The regulator also found Play Store policies to be "one-sided, ambiguous, vague, biased and arbitrary." In a statement sent to Reuters, Google said it's looking forward to working with the CCI to "demonstrate how Android has led to more competition and innovation, not less."

The tech giant reportedly responded to the probe 24 times to defend itself, and other tech companies including Microsoft, Amazon, Apple, Samsung and Xiaomi also responded to questions from the commission. While CCI still decided that Google illegally stifled competition in the country, the company will have another chance to defend itself before the CCI issues its final decision along with penalties, if any.

Just a few days ago, South Korean regulators also came to the decision that Google used its dominant position in the market to hamper the development of Android rivals. They slapped the tech giant with a $177 million fine. They also banned the company from requiring manufacturing partners to sign anti-fragmentation agreements, which prohibit the creation and installation of alternative versions of the Android OS. 

Quibi will transfer its video tech to another company to settle lawsuit

The ghost of Quibi is giving up the Turnstyle rotating video tech that let users watch its short-form content in either landscape or portrait mode on phones. A company called Eko filed a lawsuit over the feature a month before Quibi's ill-fated launch. Eko accused Quibi of patent infringement and claimed it used stolen trade secrets to build the tech.

The companies have settled their legal claims against each other, and Quibi is transferring the Turnstyle tech and intellectual property to Eko. The financial terms of their settlement haven't been disclosed, as Variety notes. Eko sought over $100 million in damages from Quibi.

“We are satisfied with the outcome of this litigation, and proud of the independently created contributions of Quibi and its engineering team to content presentation technology,” Quibi founder Jeffrey Katzenberg said.

Eko filed its suit in March 2020. That July, a court ruled that Quibi could keep using Turnstyle pending the outcome of the lawsuit. As it turns out, the case lasted far longer than Quibi's streaming service — the app shut down last December, less than eight months after it debuted.

Quibi sold its content library to Roku, which won an Emmy for one of those series this past weekend. After selling its shows, a Quibi holding company called QBI Holdings was formed as the legal battle played out.

The settlement is another nail in the coffin for a big, expensive, failure of a bet on mobile streaming. Quibi was designed for on-the-go viewing, but it launched in the midst of a pandemic, when most people weren't moving around. Still, at least we'll always have memories of "The Golden Arm."

Activision Blizzard workers accuse company of violating federal labor law

Activision Blizzard is facing still more legal action over its labor practices. As Game Developerreports, Activision Blizzard workers and the Communication Workers of America have filed a complaint with the National Labor Relations Board accusing the game developer of using coercion (such as threats) and interrogation. While the filing doesn't detail the behavior, the employee group ABetterABK claimed Activision Blizzard tried to intimidate staff talking about forced arbitration for disputes.

Companies sometimes include employment clauses requiring arbitration in place of lawsuits. The approach typically favors businesses as arbitrations are often quicker than lawsuits, deny access to class actions and, most importantly, keep matters private. Work disputes are less likely to reach the public eye and prompt systemic change. Tech firms like Microsoft have ended arbitration for sexual harassment claims precisely to make sure those disputes are transparent and prevent harassers from going unchecked.

It's not clear how Activision Blizzard intends to respond. We've asked the company about the complaint. The NLRB has yet to say if it will take up the case.

The gaming giant has taken some action in response to California's sexual harassment lawsuit, dismissing three senior designers and a Blizzard president after they were referenced in the case. It has so far been reluctant to discuss structural changes, though. The NLRB complaint might intensify the pressure for reform, and certainly won't help Activision Blizzard's image.

If the NLRB rules in our favor, the ruling will be retroactive and we will set a precedent that no worker in the US can be intimidated out of talking about forced arbitration.

— ABetterABK (@ABetterABK) September 14, 2021

Google slapped with a $177 million fine by South Korea's antitrust authorities

The Korea Fair Trade Commission has imposed a $177 million fine on Google, accusing the tech giant of using its dominant position in the market to hamper the development of Android rivals. According to Yonhap News, Korea's antitrust regulator has decided that the anti-fragmentation agreement (AFA) Google makes manufacturers sign in exchange for using its Android operating system hampers competition. 

The agreement prevents phone manufacturers, including Korean companies Samsung and LG, from creating and installing their own versions of the Android OS (or Android forks) on their devices. Yonhap News says the commission has been looking into whether the agreement stifles competition since 2016. In addition to slapping Google with a fine, the commission has also banned the company from forcing manufacturers to sign AFAs going forward and to modify existing ones. 

In a statement sent to Bloomberg and CNBC, the tech giant argued that Android and its compatibility program sped up innovation and improved user experience, benefiting companies that include Korean manufacturers. "The KFTC's decision released today ignores these benefits, and will undermine the advantages enjoyed by consumers. Google intends to appeal the KFTC's decision," the spokesperson said.

The KFTC has revealed its decision on the same day Korea's amendment to the country's Telecommunications Business Act went live. That amendment adds a law that will require Google and Apple to allow third-party payments for the applications on their App Stores.

DC AG expands Amazon lawsuit to include wholesaler pricing tactics

Washington, DC Attorney General Karl Racine has filed an amended antitrust lawsuit against Amazon. He accused Amazon of strong-arming wholesalers that provide it with products into anti-competitive agreements and making them subsidize lower prices. Engadget has contacted Amazon for comment.

"We knew Amazon was anti-competitive, but through our investigation, we’re realizing just how far it goes," Racine wrote on Twitter.

The AG contends that Amazon requires a guarantee from wholesalers that it will make a minimum profit when it resells their products. Those deals enable Amazon to undercut competitors' pricing and force wholesalers to pay the difference for lost profit margins, according to court documents obtained by The Washington Post.

Racine claims that prompts wholesalers to charge more for goods elsewhere to offset those payments, making it more difficult for other e-commerce platforms to compete against Amazon's prices. PopSockets CEO David Barnett previously testified that Amazon demanded payment from the company to make up for lost profits after it reduced prices.

In the initial version of the suit, which was filed in May, Racine claimed Amazon blocks third-party sellers from offering their wares at lower prices on other platforms. Amazon is facing antitrust scrutiny elsewhere, including from the House of Representatives, the Federal Trade Commission and the European Commission. Several state attorneys general are also said to be looking into whether the company has broken antitrust laws.

Judge issues permanent injunction on App Store model in Epic v. Apple case

The judge in the case between Apple and Epic Games has issued a permanent injunction against Apple. The company must allow developers to direct users to other payment systems, which would let them bypass the 30 percent cut of in-app payments Apple takes. The judge issued the ruling several months after the trial drew to a close. 

Developing...

Amazon complains Elon Musk's companies don't play by the rules

Amazon's response to SpaceX's FCC filing, which accused the e-commerce giant of trying to delay proposals for its Starlink internet service on purpose, is just as scathing. In an FCC filing of its own, Amazon told the regulator that SpaceX chief Elon Musk tends to ignore rules and government-imposed regulations. The company also said that SpaceX often accuses any company "that dares point out its flouting of laws and regulations" as "anticompetitive."

Part of Amazon's filing reads:

"Try to hold a Musk-led company to flight rules? You"re "fundamentally broken." Try to hold a Musk-led company to health and safety rules? You're "unelected & ignorant." Try to hold a Musk-led company to US securities laws? You'll be called many names, some too crude to repeat...

Whether it is launching satellites with unlicensed antennas, launching rockets without approval, building an unapproved launch tower, or re-opening a factory in violation of a shelter-in-place order, the conduct of SpaceX and other Musk-led companies makes their view plain: rules are for other people, and those who insist upon or even simply request compliance are deserving of derision and ad hominem attacks."

As Ars Technica notes, Amazon urged the FCC a couple of weeks ago to reject a proposal from SpaceX regarding the future of its Starlink internet service. Back then, Amazon claimed that SpaceX was proposing "two mutually exclusive configurations" with "very different orbital parameters," which goes against regulations. SpaceX responded that it only proposed two possible configurations in case the one it actually prefers doesn't work out. The Elon Musk-led company then told the FCC that the move is "only the latest in [Amazon's] continuing efforts to slow down competition."

If you'll recall, Jeff Bezos-owned Blue Origin also filed a complaint against NASA with the US Court of Federal Claims over the lunar lander contract it awarded to SpaceX. Blue Origin expected the space agency to award two contracts instead of just one and argued that the selection process was unfair, because it wasn't given the opportunity to revise its bid in the face of a smaller budget than expected. The litigation forced the space agency to put the $2.9 billion project on hold for the second time. 

When Amazon asked the FCC to reject SpaceX's Starlink proposal, the latter suggested that Amazon, "as it falls behind competitors ... is more than willing to use regulatory and legal processes to create obstacles designed to delay those competitors from leaving [it] even further behind."

Google settles lawsuit with ex-employee who claimed firing was in retaliation for organizing

In 2019, Google parent, Alphabet Inc, terminated the employment of two software engineers, Laurence Berland and Rebecca Rivers, in a move that sparked company-wide protests and accusations of retaliation for the pair's efforts to organize their workplace. On Wednesday the National Labor Relations Board (NLRB) announced that it had approved a proposed settlement between the company and Berland.

While neither Berland's legal council nor Alphabet could be reached for comment, Bloomberg notes that this agreement does not impact the NLRB's continuing investigation into Alphabet's alleged firing of other employees who protested the company's coordination with US Customs and Border Patrol, which is currently being argued in a San Francisco courtroom. 

Per previous testimony in Berland's case, Alphabet argued that the firings were due directed at those “who abused their privileged access to internal systems, such as our security tools or colleagues’ calendars.” Berland, in his defense, countered that "I told them that I accessed the calendars because I was concerned that our rights were being violated."

 

Lyft and Uber will cover legal fees of drivers sued under Texas abortion law

Lyft will cover the legal fees of drivers sued under the state of Texas’ recently enacted SB8 abortion law, the company announced on Friday. The law prohibits women from terminating a pregnancy after six weeks. That’s a time frame before most even know they’re pregnant. Critically, SB8 also allows private citizens to sue anyone who assists a pregnant woman trying to skirt the ban, including rideshare drivers who face the prospect of $10,000 fines.

“This law is incompatible with people’s basic rights to privacy, our community guidelines, the spirit of rideshare and our values as a company,” Lyft said in a blog post. In response to SB8, the company is establishing a legal defense fund it says will cover 100 percent of the legal fees incurred by its drivers. It’s also donating $1 million to Planned Parenthood.

Right on @logangreen - drivers shouldn’t be put at risk for getting people where they want to go. Team @Uber is in too and will cover legal fees in the same way. Thanks for the push. https://t.co/85LhOUctSc

— dara khosrowshahi (@dkhos) September 3, 2021

“This is an attack on women’s access to healthcare and on their right to choose,” Lyft CEO and co-founder Logan Green said on Twitter in which he also called other companies to offer the same support. Uber CEO Dara Khosrowshahi responded some 30 minutes later, announcing Uber would follow suit. “Team Uber is in too and will cover legal fees in the same way,” Khosrowshahi said. “Thanks for the push.” The move comes after the US Supreme Court formally denied a request earlier in the week from abortion clinics in the state to freeze the law.