WASHINGTON (Reuters) -The U.S. Justice Division agreed to a settlement with Activision Blizzard to resolve the division’s lawsuit filed on Monday over wage limits in skilled esports leagues.

The division mentioned in its lawsuit filed in U.S. District Courtroom in Washington that Activision Blizzard Inc (NASDAQ:), which owns leagues constructed round its “Overwatch” and “Name of Responsibility” video video games, and the independently owned groups imposed a tax that “successfully operated as a wage cap, penalized groups for paying esports gamers above a sure threshold and restricted participant compensation in these leagues.”

The Justice Division criticism mentioned Activision dropped plans for wage limits in October 2021.

Activision mentioned in an announcement, “The tax was by no means levied, and the leagues voluntarily dropped it from our guidelines in 2021.

“Now we have at all times believed, and nonetheless consider, that the Aggressive Steadiness Tax was lawful, and it didn’t have an adversarial affect on participant salaries,” it added.

Underneath the settlement, which nonetheless should be permitted by a federal decide, Activision agreed to chorus from placing any caps or limits on salaries of esports gamers or groups, the division mentioned.

The Justice Division famous an estimated 60% of People report they play video video games on a weekly foundation — and tens of millions like to look at video video games performed by professionals.

The “Overwatch” and “Name of Responsibility” leagues have generated tons of of tens of millions of {dollars} from franchise charges, sponsorship revenues, unique streaming offers and a tv broadcast deal for Activision drawing tens of millions of viewers, the federal government mentioned.