21st Century Fox Sues Netflix for Poaching Employees
September 16 2016 - 3:50PM
Dow Jones News
By Joe Flint
21st Century Fox on Friday filed a lawsuit against Netflix Inc.,
accusing the streaming video giant of illegally hiring two of its
executives who were under contract.
The suit, filed in California Superior Court in Los Angeles by
Fox units Twentieth Century Fox Film Corp. and Fox 21 Inc., alleges
that Netflix has run 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."
The two executives were Tara Flynn, who was hired last week as a
drama programming development executive from TV production unit Fox
21, where she was vice president of creative affairs; and Marcos
Waltenberg, a Twentieth Century Fox Film promotion executive who
took a similar role at Netflix in January.
In both cases, Fox said, it warned Netflix that it was illegally
tampering with executives under contract but the streaming company
nevertheless hired the pair and indemnified them against potential
charges of breach of contract, according to the suit.
"As a direct and proximate result of Netflix's conduct, Fox has
suffered great and irreparable harm," the suit said. Fox is seeking
a permanent injunction prohibiting Netflix from interfering with
executives under contract as well as compensatory and punitive
damages.
A Netflix spokesperson declined to comment on the suit.
21st Century Fox and News Corp, parent company of The Wall
Street Journal, share common ownership
A tampering suit is rare in Hollywood. Industry leaders who
compete with each other during the week often golf or play tennis
together on the weekend or are involved in the same charities. In
addition, executives frequently jump from one studio or network to
another, often while still under contract. Usually some sort of
accord is reached between the two companies to avoid ill will or
legal action.
Sports broadcaster Al Michaels was famously released from his
contract at Walt Disney Co.'s ESPN early to join NBC Sports in
return for the rights to a cartoon rabbit named Oswald that Walt
Disney himself had created that belonged to NBC's Universal
Studios.
The lawsuit is the latest sign of how Netflix's rise as an
entertainment behemoth has created tensions within the entrenched
Hollywood community.
Write to Joe Flint at joe.flint@wsj.com
(END) Dow Jones Newswires
September 16, 2016 15:35 ET (19:35 GMT)
Copyright (c) 2016 Dow Jones & Company, Inc.
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