Netflix is now at the center of a legal battle with Fox for allegedly hiring employees that Fox had employment contracts with. Although this does seem to be the first time that Netflix has had to deal with an issue of this kind, it is not the first time that these types of lawsuits have played out in a court of law over whom competing companies can and cannot hire.
In this case, 20th Century Fox Film Corporation is claiming that Netflix has been poaching their top executives and luring them into their own streaming media company, according to Deadline. It is no surprise to many that Netflix has seen mountains of growth ever since they started introducing their own original programming instead of relying on companies like Fox, Lionsgate, Universal, and other TV companies to provide them with content for their streaming video buffet.
— Netflix US (@netflix) September 15, 2016
What is apparent in this case is that Fox is seeking to recover damages from Netflix for hiring employees that would have been valuable to them should they had stayed at Fox. Fox is also claiming that Netflix has been luring their “valuable employees” over to their streaming video platform.
The complaint that was filed against Netflix by Fox states that Netflix is engaged in a “brazen campaign to unlawfully target, recruit, and poach valuable Fox executives by illegally inducing them to break their employment contracts with Fox to work at Netflix.”
Netflix has also fired back, vowing to fight the lawsuit and continue on with their business practices as planned.
“We intend to defend this lawsuit vigorously,” a spokesperson for Netflix told Deadline. “We do not believe Fox’s use of fixed term employment contracts in this manner are enforceable. We believe in employee mobility and will fight for the right to hire great colleagues no matter where they work.”
— Charles Maceo (@CharlesMaceo) September 8, 2016
The employment contracts that Netflix speaks of are contracts between Fox and their employees, particularly top-level executives who seem to have some sort of inherent value to the company. These contracts are something that many companies use to get their employees to either stay with them or vow not to seek employment at a competing entity. They are quite common in the marketplace for nearly all industries.
The damages that Fox seeks for this lawsuit have not been specified as of yet, but they have indicated that they want Netflix to stop hiring their current and former employees.
As the plaintiffs for the lawsuit, Fox intends to get “a permanent injunction enjoining Netflix, and its agents, servants, employees, attorneys, successors and assigns, and all persons, firms and corporations acting in concert with it, from interfering with any of Fox’s Fixed-Term Employment Agreements.”
Although it is unclear what kind of damages are sought to be awarded to Fox with this lawsuit, Netflix is taking a strong offensive stance in response and has vowed to fight Fox and their supporting companies in this matter. But Fox is not backing down.
“As our complaint explains, we filed this lawsuit because we believe Netflix is defiantly flouting the law by soliciting and inducing employees to break their contracts,” a spokesperson for 20th Century Fox told Deadline. “We intend to seek all available remedies to enforce our rights and hold Netflix accountable for its wrongful behavior.”
21st Century Fox Is Suing Netflix for Poaching Employees – https://t.co/jnVFeBZVCN
— CMSnice (@cmsnice_com) September 18, 2016
There has been no word yet on an official comment from Netflix on this matter. There are two people in particular who are at the heart of this situation. They are Marco Waltenberg and Tara Flynn, who currently run the promotions and drama development teams at Netflix. Both had employment contracts with Fox before they made the switch over to Netflix.
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