Activision and EA settle, but Call of Duty trial to go forward


Video game giants Activision Blizzard Inc. and Electronic Arts Inc. have settled their litigation as a larger trial over the Call of Duty video game franchise is scheduled to proceed this month.

Santa Monica-based Activision and Redwood Shores, Calif.-based EA announced their settlement at a California Superior Court hearing in Los Angeles on Wednesday.

The long-running rivalry between the two companies heated up in 2010 when EA agreed to fund a new studio headed by Jason West and Vincent Zampella, the co-creators of Call of Duty whom Activision had fired that year.

Activision later added EA as a defendant in its lawsuit against West and Zampella. It accused EA, best known for Madden NFL and the Sims, of a plot to “destabilize, disrupt and ... destroy Infinity Ward,” the studio previously headed by West and Zampella that made many Call of Duty games.

“Activision and EA have agreed to put this matter behind them,” the companies said in a statement.

Terms of the settlement were not disclosed. It comes just a week after Activision hired a new attorney to take charge of the Call of Duty case.

Also at Wednesday’s hearing, Judge Elihu Berle denied Activision’s request to delay the Call of Duty trial for 30 days in order in order to give its new lawyer more time to prepare.

Berle said from the bench that Activision did not show “cause” and that a delay would “disrupt the lives” of about 40 developers who worked under West and Zampella at Encino-based Infinity Ward and are also part of the litigation.

The trial, to begin May 29, may be the most closely watched in the history of the video game business. After Activision fired West and Zampella for allegedly breaching their contracts by seeking to take intellectual property for their own personal gain, the two filed a lawsuit alleging they were wrongfully terminated and sought unpaid royalties and bonuses. That amount is alleged to total in the hundreds of millions of dollars. Together with punitive damages, they are seeking more than $1 billion.

Activision countersued the duo, accusing them of “disloyalty” and labeling them “self-serving schemers.”

Soon after, several dozen Infinity Ward employees, all of whom have since left the development studio, also filed a lawsuit. In it they alleged that Activision withheld royalties for 2009’s hit Call of Duty: Modern Warfare 2 to encourage them to work on Modern Warfare 3, released last year.

On Monday, Activision paid those employees $42 million in bonuses related to Modern Warfare 2. But the group has not dropped its suit.

In recently unsealed documents, Activision’s former senior director of information technology said the company’s chief public policy officer asked him to “dig up dirt” on West and Zampella by secretly accessing their work emails, voicemails and computer files months before they were fired.

Activision spokeswoman Maryanne Lataif declined to comment on the documents.