‘Riot Games’ to pay $10 million to settle gender discrimination lawsuit

By Jeff Jones
Special to the UCBJ

Riot Games, developer of the popular online battle game “League of Legends,” has agreed to pay out at least $10 million to women who worked at the company in the last five years as part of a settlement in a class action lawsuit over alleged gender discrimination. 

In the Plaintiff’s Notice of Motion and Motion for Preliminary Approval of Settlement, the two female employees who led the class-action lawsuit will receive $10,000 each and will be paid in addition to any payment they may otherwise receive as members of the proposed class. The settlement filing also lays out a number of commitments Riot has made to improve its company culture, including beefing up internal programs for reporting sexual harassment and discrimination.

Pursuant to the Settlement Agreement, each Settlement Employee Subclass member shall receive a minimum payment of at least $5,000 for employees hired prior to Sept. 1, 2018, and $2,500 for employees hired after Sept. 1, 2018. Each Settlement Temporary Agency Contractor Subclass will receive a minimum payment of $1,000 for contractors performing work prior to Sept. 1, 2018, and $500 if engaged after Sept. 1, 2018.

The lawsuit against Riot Games began in November 2018 when two employees, one current and one former, sued the company for “endemic gender-based discrimination and fostering a ‘men-first’ environment.” The class-action lawsuit accused Riot Games of violating California’s Equal Pay Act. 

The California Equal Pay Act prohibits an employer from paying its employees less than employees of the opposite sex for equal work.  In 2015, Governor Brown signed the California Fair Pay Act, which strengthened the Equal Pay Act where, amongst a slew of other changes, notably required employers to furnish employees equal pay for employees who perform “substantially similar work,” when viewed as a composite of skill, effort, and responsibility.

In January 2017, Governor Brown signed a bill that added race and ethnicity as protected categories. In January 2018, the Equal Pay Act was amended to encompass public employers.  Labor Code section 432.3 was enacted (also effective January 2018) prohibiting employers, with one exception, from seeking applicants’ salary history information and requiring employers to supply pay scales upon the request of an applicant. 

The Riot Games suit came after an investigation from a Kotaku report on the alleged culture of sexism at Riot Games. One former female employee described the working environment at Riot Games in the following manner:

… her direct manager would ask her if it was hard working at Riot being so cute. Sometimes, she said, he’d imply that her position was a direct result of her appearance. Every few months, she said, a male boss of hers would comment in public meetings about how her kids and husband must really miss her while she was at work. 

The same employee also described an experiment she conducted when it came to present new ideas during company meetings:

After an idea she really believed in fell flat during a meeting, she asked a male colleague to present the same idea to the same group of people days later.  He was skeptical, but she insisted that he give it a shot.  “Lo and behold, the week after that, [he] went in, presented exactly as I did and the whole room was like, ‘Oh my gosh, this is amazing.’  [His] face turned beet red and he had tears in his eyes,” said Lacy. “They just didn’t respect women.” 

To read the full article, Inside the Culture of Sexism at Riot Games, See https://kotaku.com/inside-the-culture-of-sexism-at-riot-games-1828165483.

The Riot Games lawsuit set forth allegations that the company cultivated a “men-first” and “bro culture.” The suit alleged harassment and inappropriate behavior such as but not limited to “crotch-grabbing, phantom humping, and sending unsolicited and unwelcome pictures of male genitalia.” The lawsuit also alleged managers circulated a “hot girl list,” ranking female employees by attractiveness, which apparently went unchecked. 

Court documentation in the Riot Games suit revealed that outspoken female employees repeatedly faced retaliation including denied promotions, refusals to provide increased compensation or equal pay, demotions, reassignment with significantly different responsibilities, losses of benefits, suspensions, terminations, and other adverse employment actions.

Although the law doesn’t prohibit simple teasing, offhand comments, or isolated incidents that are not very serious, harassment is illegal when it is so frequent or severe that it creates a hostile or offensive work environment or when it results in an adverse employment decision (such as the victim being fired or demoted).  The harasser can be the victim’s supervisor, a supervisor in another area, a co-worker, or someone who is not an employee of the employer, such as a client or customer. See, https://www.eeoc.gov/laws/types/sex.cfm for more information on sex-based discrimination.

In Tennessee, Tenn. Code Ann. §50-2-202 states in relevant part: 

No employer shall discriminate between employees in the same establishment on the basis of sex by paying any employee salary or wage rates less than the rates the employer pays to any employee of the opposite sex for comparable work on jobs the performance of which require comparable skill, effort and responsibility, and that are performed under similar working conditions; however, nothing in this part shall prohibit wage differentials based on a seniority system, a merit system, a system that measures earnings by quality or quantity of production, or any other reasonable differential that is based on a factor other than sex.

Employers who want to maintain an optimal and respectful working environment and who want to minimize liability exposure should focus on preventative measures such as developing appropriate policies, regularly training managers and supervisors, conducting timely and appropriate investigations into reports of misconduct, and taking necessary action to address discriminatory and harassing behavior. Employers should timely consult with legal counsel in order to develop strategic plans for safeguarding against and correcting discrimination and harassment in the workplace. These actions not only promote a positive workplace but may also keep your organization from becoming the next $10 million lawsuit. 

Jeffrey G. Jones is a regional managing member for Wimberly Lawson Wright Daves & Jones PLLC. He can be reached at jjones@wimberlylawson.com.

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