Activision Blizzard CEO Bobby Kotick has lost a long-running legal battle with his former lawyer over fees incurred while battling a lawsuit from a former flight attendant who worked on his private jet, the Los Angeles Times reports.
Kotick is "reviewing his options" following an arbitrator's ruling that he pays a whopping $1.4 million to his old law firm.
The dispute stemmed from a January 2007 lawsuit brought by flight attendant Cynthia Madvig against Kotick, Andrew Gordon of Goldman Sachs, Cove Management, the company the pair created to manage their co-owned Gulfstream III private jet, and pilot Phil Berg.
Madvig alleged sexual harassment and wrongful termination. She allegedly refused to be Berg's "arm candy" at dinners and other events. The lawsuit said that Berg compelled her to clean the plane's toilets repeatedly while "leering" at her.
She claimed that after complaining, she was fired by Kotick, who allegedly told her: "The guys are unhappy with the hostile environment."
Kotick's then lawyer Patricia Glaser advised him to settle for $200,000 to $400,000 much less than it would cost to argue the toss in court. Kotick disagreed.
According to the arbitrator, "Mr. Kotick wanted to destroy the other side and not to pay Ms. Madvig anything.... Mr. Kotick realised this was not a good business proposition, but said 'that he was worth one-half billion dollars and he didn't mind spending some of it on attorneys' fees.' "
According to court records: "Mr. Kotick believed no sexual harassment or retaliation had taken place and it was important to vindicate the principle even if it would be very expensive in terms of legal fees."
Kotick's bullish stance eventually waned. In September 2007 he sent Glaser a check for $200,000 with a letter saying it was payment in full for services rendered.
Glaser, however, claimed the firm was owed just over $1 million. The dispute went to arbitration and in March 2009 Kotick lost.
"Cove Management believes that the billings from Christensen Glaser were excessive and inappropriate given the nature of the case," said Anthony Glassman, the attorney who represents Kotick and Gordon's firm Cove.
Glassman also disputed the arbitrator's description of conversations Kotick had regarding the case: "Both the final award and appellate opinion contain numerous second-hand accounts of three-year-old private conversations and statements made during attorney-client meetings that Mr. Kotick did not make and therefore are inaccurate, highly inflammatory and taken out of context."
And yes, Kotick eventually settled with Madvig. He spent over $200,000 in April 2008, plus another $475,000 in legal fees. Now if only he'd listened to his lawyer in the first place
Despite the eye-watering expense, Kotick is sure to be pleased this morning. Activision's just announced it's sold more than 20 million Call of Duty map packs.