Activision Blizzard Inc is forming a business unit for its blockbuster Call of Duty franchise, following the departure of two senior executives at the studio that developed the video game, the company said on Tuesday.

Jason West, president of the Infinity Ward studio, and Vince Zampella, its chief executive, have left the company, Activision said.

In a regulatory filing, Activision said it is finishing an internal inquiry into breaches of contract and insubordination by two senior employees at Infinity Ward.

The issue is expected to result in the departure of key personnel and litigation, but the company said it does not expect it to have a material impact.

An Activision spokesman declined to provide any details beyond the filing, but said the departure of the Infinity Ward executives and the decision to form a new business unit for Call of Duty were unrelated.

Infinity Ward, which was acquired by Activision in 2003, developed the original Call of Duty game and several others in the franchise.

Call of Duty: Modern Warfare 2, the sixth installment in the series, was released in November and went on to sell nearly 12 million units in the United States, Japan and the United Kingdom for 2009. It set an industry record with first-day sales of 4.7 million copies, raking in an estimated $310 million.

The newest Call of Duty title, scheduled for release this fall, was developed by a different Activision studio, as was another title in the series expected to be released in 2011, Activision said.

The new Call of Duty business unit will be led by Philip Earl, who currently runs Activision Publishing's Asia Pacific region.

The company said it will look to expand the brand into new geographies and genres, and focus on higher-margin digital online content.

Steve Pearce and Steve Ackrich will lead Infinity Ward on an interim basis.

Shares of Santa Monica, California-based Activision closed down 1.2 percent at $10.81 on the Nasdaq.

(Reporting by Gabriel Madway, editing by Leslie Gevirtz)

Japan United kingdom Call of Duty