Poached employee leads to business litigation

| Dec 28, 2020 | business litigation |

In the business world, contracts provide stability to agreements and relationships among business owners, customers, vendors and others. North Carolina employers can also keep valuable employees through contractual agreements that prevent workers from leaving to work for competing companies. Employees who breach such contracts may face costly business litigation.

In one case, however, it was not the employee but the employee’s new company that a former employer sued. Activision Blizzard had worked out a deal with subscription streaming giant Netflix to distribute the company’s video games. While in negotiations, Netflix executives allegedly began to entice the CFO of Activision to leave the company and join Netflix as its CFO. When Activision learned that the CFO, who was in the middle of a three-year contract, was considering leaving for Netflix, the company terminated him, and Netflix hired him within days.

The details of the lawsuit

Activision is now suing Netflix for poaching its CFO and intentionally interfering with the employment contract with CFO, in violation of state laws. They also claim that Netflix encouraged the CFO to breach his contract and fiduciary duties, assuring him that the multi-billion-dollar company would cover any legal fallout that ensued. Apparently, this is not the first time Netflix has poached workers who were contracted to other companies, and Netflix argues it is wrong to lock employees into long employment deals.

Business litigation can involve complex matters with claims and counterclaims. It may be especially contentious when the lawsuit involves a David-and-Goliath dispute. Having skilled and experienced legal counsel may level the playing field.