Obsidian Entertainment, the Xbox Game Studios team known for Fallout: New Vegas, The Outer Worlds (1/2), Avowed, Pentiment, and more, is facing a class-action lawsuit over allegations that the studio violated California Labor laws to "increase their profits" through these violations, though Obsidian denies them entirely.
Initially spotted by GamesRadar+, the suit is being led by Victoria Turner, who previously worked at Obsidian as a QA lead. The suit was initially filed back in October 2025, and was amended this past January 2026, which lists the full spread of allegations against Obsidian.
"Through this action, Plaintiff alleges that Defendants engaged in a systematic pattern of wage and hour violations under the California Labor Code and Industrial Welfare Commission ('IWC') Wage Orders, all of which contribute to Defendants' deliberate unfair competition," the suit reads.
The allegations include:
- Failing to pay all wages (including minimum wages and overtime wages)
- Failing to provide lawful meal periods or compensation in lieu thereof;
- Failing to authorize or permit lawful rest breaks or provide compensation in lieu thereof
- Failing to reimburse necessary business-related costs
- Failing to provide accurate itemized wage statements
- Failing to pay wages timely during employment
- Failing to pay all wages due upon separation of employment
As previously mentioned, Obsidian denies all of the allegations, and asks that the suit be tossed out "with prejudice." It also went further to claim that employees "consented to and/or acquiesced" to not having lunch breaks, saying they "voluntarily waived meal periods or rest breaks."
Which is some kind of defence when accused of failing to adhere to labor laws to just turn around and say, 'we didn't break labor laws, the employees chose to go against their right to a lunch break.'
It'll be interesting to see how this case progresses, as its outcome could set a new precedent for the kinds of overworking and crunch allegations we see brought against studios. It's also yet another layer of the mess that currently is the entire Xbox division, as the entire industry watches and waits for what we expect to be one of the worst rounds of mass layoffs we've seen in years.
About the author: David has been writing about videogames, technology, and culture since 2020, with a focus on reporting daily news across multiple publications, including GameDaily.Biz, GameSkinny, and PlayStation Universe before joining Wccftech in 2025. David started contributing as Canada/US reporter for Wccftech's gaming section in 2025. Besides being up-to-date on the industry's movements, he loves interviewing developers, reviewing games, and writing intricate essays about the symbolism and layered meanings to be found in rich narratives as he's done for publications like GamesIndustry.Biz, LostInCult, and others. Outside of games he loves movies, music, theatre, his hometown, and his family, though not necessarily in that order.
Follow Wccftech on Google to get more of our news coverage in your feeds.
