(UPDATED 6:15 PM PT with Fox statement) Fox and Netflix’s long legal dust-up over the streamer’s snatching of two executives almost three years ago is heating up as the former attempts to get the upcoming trial pushed back and the sparring latter wants to draw Rupert Murdoch’s New Fox and almost every other studio in town into the damning action.
“No longer content — or able — to lock in the stars, Fox seeks to lock into place for years at a time the innumerable marketing, accounting, production, and other business executives who conduct its daily business, using onerous, one-sided contract terms and baseless threats,” declares the Orrick Herrington & Sutcliffe LLP represented Reed Hastings run streamer in a filing today (read it here). “But in doing so, Fox has indisputably violated long-standing California public policy that protects employee mobility and prizes free and fair competition, including competition for skilled and talented employees providing business services,” Netflix adds, calling Fox’s claims of unfair competition “fundamentally flawed, exposing the unfair, abusive, and anticompetitive conduct Fox uses to hold its employees hostage.”
“This motion boils down to a single legal issue for the court to decide: Should Fox be permitted to use the UCL (unfair competition claim) to obtain injunctive relief against Netflix broader than any it could legally obtain against its employees themselves?” asks the lightly redacted 19-page motion. “Based on undisputed facts, the answer is an resounding ‘no.’”
“Employees at Fox have every right to the security and protections of their employment contracts, and Netflix has no right to interfere with them,” a Fox spokesperson said Friday “Netflix’s claims have no legal basis, and we are confident Netflix will be held accountable in our lawsuit” the company added. The plan inside the House of Rupert is that Fox are likely to file their own summary judgement this weekend too.
However, for now, Fox is remaining silent on its seemingly unsuccessful move earlier today to push the May 20 starting trial back.
“Despite Fox’s diligent efforts, substantial discovery remains outstanding, and Netflix’s recent issuance of numerous subpoenas across the industry is an unanticipated development that indicates that Netflix (improperly) seeks to greatly expand the scope of discovery,” Fox’s main lawyer Daniel Petrocelli at O’Melveny & Myers LLP said in an application (read it here) filed yesterday of the May scheduled trial. “Accordingly, Fox respectfully requests that the Court issue an order continuing the trial to a date in the fall of 2019.”
At a hearing today at the Santa Monica Courthouse in front of Judge Lawrence Cho, Fox came up short in its desire to have the trial in the long-fought battle start in October, at least for now.
However, as Netflix fights a similar war with Viacom over having more recently poached execs from the Republic of Redstone, all is not lost for Fox as Judge Cho has yet to rule if the soon to be dissolved Fox Network Group, which include the still Murdoch owned Fox TV, and Fox Entertainment Group will become formal parties in the case. The L.A. Superior Court official has also not yet given Netflix the green light to getting undoubtedly disruptive depositions and data in the matter from Viacom, Viacom-owned Paramount, Disney, NBCUniversal and more. Depositions and data that Fox made very clear on Thursday that it plans to bring “strenuous objections and motions to quash” against.
Of course, it could all take time, which neither side feels they have a lot of here.
This all started back in September 2016, when Fox went after Netflix claiming it had illegally snatched executives Marcos Waltenberg and Tara Flynn and encouraged them to break their employment contracts. Netflix hit back with a counter-suit soon after, asserting that Fox was actually engaged in unlawful and anti-competitive business practices by locking its employees into restrictive fixed-term employment agreements that limit their job mobility – deals the hiring Netflix considered invalid and hence a major shift in the way employee contracts in California are managed.
And so, it all grinded on, with the multi-billion-dollar deal between Bob Iger and the Murdochs to sell much of Fox to Disney starting, solidifying and becoming a soon-to-be reality in the meantime.
Last July, almost a month after the California Court of Appeal kicked to the curb Fox’s already once denied before effort move to have the courts dismiss Netflix’s contention that its employment contracts were hollow on free speech grounds, a trial date of May this year was penciled in on the calendar.
Whether that actually happens or not, remains to be seen but you might not want to plan any out of town trips in May …just sayin’.
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