A Delaware judge has ruled that former Activision Blizzard executives, including longtime Chief Executive Officer Bobby Kotick, must face key shareholder claims accusing them of undervaluing the company during Microsoft’s $75.4 billion acquisition of the gaming giant.

In a decision handed down on Thursday, Chancellor Kathaleen McCormick of the Delaware Chancery Court allowed the “core” claims in the shareholder lawsuit to move forward. The suit, led by Swedish pension fund Sjunde AP-Fonden, alleges that Kotick and other board members breached their fiduciary duties to investors during the negotiation and approval of the 2023 merger.

The lawsuit claims that Kotick was motivated by personal interests, including preserving his executive position and securing approximately $400 million in change-of-control benefits. It further accuses him of pushing for a quick sale to Microsoft in an effort to shield himself from mounting allegations that he was aware of widespread sexual harassment and workplace misconduct at Activision.

Shareholders also argue that the $95-per-share acquisition price was “too low from the outset,” and that the deal appeared increasingly unfavorable as Activision’s financial performance improved throughout the 21-month regulatory review period preceding the merger’s completion in October 2023.

In her 83-page opinion, McCormick wrote that there were sufficient allegations suggesting Kotick manipulated the sales process to favor Microsoft, which “offered speed, deal certainty, and—inferably—a friendly landing place.” The court also found it “reasonably conceivable” that Activision’s directors prioritized Kotick’s personal interests over those of shareholders, particularly by approving a deal that undervalued the company while its stock price was weighed down by public scrutiny over workplace scandals.

However, McCormick dismissed two claims against Microsoft, ruling that the tech giant did not aid or abet the alleged breaches by Activision’s leadership. Even if Microsoft “passively stood by” during the events in question, she determined there was not enough evidence to hold the Redmond, Washington-based company legally responsible. Other claims against Activision’s executives were also dismissed.

“Litigation on the merits of a trimmed-down version of the plaintiff’s complaint can now launch,” McCormick concluded. “Game on.”

The ruling clears the way for the lawsuit to proceed, potentially bringing to light new details about how one of the gaming industry’s largest and most controversial mergers was handled behind closed doors.

As of Friday, lawyers representing both the Activision defendants and Microsoft declined to comment on the ruling, while representatives for the shareholders did not immediately respond to similar requests.

The case, titled Sjunde AP-Fonden v. Activision Blizzard Inc. et al., is being heard in the Delaware Chancery Court under case number 2022-1001.

If proven, the claims could have far-reaching implications for corporate governance and executive accountability in large-scale mergers and acquisitions, especially in high-profile industries like gaming and technology.