The issue seems to be whether gamers should be considered employees or independent contractors. I’m not sure how your statement follows.
But in contrast to professional athletes in the traditional sports industry, League of Legends players are not considered employees. According to the 2019 Championship Series rules, gaming athletes are independent contractors and the Riot Games gamer contract does not define the employer/employee relationship.
Why wouldn't Riot Games move their HQ and not deal with the California law? I realize that companies that want the regional market (such as Uber and Lyft) wouldn't go, but if you don't have to maintain a presence in CA, why would you?