Fox sues Netflix over ‘executive poaching’

21^st Century Fox is suing Netflix over alleged executive poaching.

The suit claims the SVOD company has 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”.

Though Netflix has hired a number of former Fox execs, the suit concerns a pair of execs that Netflix brought over directly from the US studio. They are Tara Flynn, who became VP of creative affairs, and marketing executive Marcos Waltenberg.

According to the complaint, Netflix had encouraged Flynn, who had worked at Fox 21 Television Studios in since 2013, and Waltenberg to breach their contracts.

The Wall Street Journal reported Flynn had amended her contract to receive additional compensation in return for handing Fox the right to retain her through most of 2019. However, she left for Netflix last month.

“We filed this lawsuit because we believe Netflix is defiantly flouting the law by soliciting and inducing employees to break their contracts,” Fox said in a statement to press. “We intend to seek all available remedies to enforce our rights and hold Netflix accountable for its wrongful behaviour.”

Netflix responded by saying it would “defend this lawsuit vigorously”.

“We do not believe Fox’s use of fixed term employment contracts in this manner are enforceable,” added a spokesman. “We believe in employee mobility and will fight for the right to hire great colleagues no matter where they work.”

Fox is seeking a permanent injunction that would block Netflix “from interfering with executives under contract, as well as compensatory and punitive damages”.

US entertainment companies rarely engage in legal action over executive poaching, but Netflix has shaken the majors by quickly rising to become a key player in the ecosystem.

Fox has previously criticised Netflix and its business model, with FX Networks president John Landgraf recently saying the on-demand service had taken an “assembly line” approach to commissioning that was not positive for the creative community.