Netflix sued by Fox for poaching executive talent as SVOD service faces Tinseltown backlash

Netflix office

Netflix is proving that you can’t muscle into Hollywood with a $6 billion original content budget without making a few enemies.

The SVOD service is being sued by 21st Century Fox for allegedly poaching executive talent from the media conglomerate's TV and film studio operations. The suit accuses Netflix of 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.”

“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. “We intend to seek all available remedies to enforce our rights and hold Netflix accountable for its wrongful behavior.”

Responded Netflix: “We do not believe Fox’s use of fixed-term employment contracts in this manner is enforceable. We believe in employee mobility and will fight for the right to hire great colleagues no matter where they work.”

The lawsuit comes after Fox theatrical marketing executive Marcos Waltenberg bolted on his fix-term contract and joined Netflix earlier this year. Also switching over was Tara Flynn, formerly VP of creative affairs for Fox 21 TV Studios.

The lawsuit comes amid increased grumbling among studio executives and agents in Hollywood, who admit their industry would suffer dramatically if Netflix’s massive spending budget went away, but are concerned about the influence the SVOD service is having on their business. 

Specifically, there’s concern about Netflix buying up all rights, removing Hollywood from syndication, cable and international licensing cycles.

"We love the money and we can still grow our clients [by getting them Netflix deals],"  an unnamed agent told the Hollywood Reporter. "But I'm worried about the long term. If backends go away, what's the future? 

For more:
- read this Los Angeles Times story
- read this Bloomberg story
- read this Hollywood Reporter story

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