For several years Netflix has been seeking to change the Hollywood employment rules to more flexible. So far, his crusade has been resisting the courts.
Streamed Goliath offers recruits a higher salary, provided they leave the current employer, even if they have a contract. This sparked a protest from Viacom, who claims that Netflix steals their management and interferes in contracts.
Netflix claims that two-year and three-year contracts – a standard for managing directors in the entertainment sector – are illegal and resemble slavery. California law statute of limitations on employment contracts that last longer than seven years.
Netflix claims that his rivals violate this law, extending contracts in the middle of the period, effectively forcing his employees to take up additional years of employment.
Netflix presents its campaign as a fight for labour mobility against such practices, but the courts disagree with this approach.
The Los Angeles Supreme Court judge ruled in favor of Viacom, who sued Netflix in 2018, After a longtime Viacom employee, Momita SenGupta, left 19 months before her contract expired to become vice president of Netflix for the physical production of original series.
The ruling came a year after another judge ordered Netflix to stop stealing Fox employees. In his ruling, Judge Jon R. Takasugi stated that the Viacom contract does not infringe the law. “After reading the relevant case law and legislative history...
The Court agrees that SenGupty's agreement does not violate the seven-year rule," said Takasugi. The judge also ruled in favour of Viacom, who stated that Netflix had engaged in unfair competition by trying to interfere in her contracts.
Viacom requested a warrant similar to what Fox obtained, which forbids Netflix from contacting his employees. In a preliminary ruling issued last week, Takasugi indicated that he would issue a warrant. But the final ruling does not include this record, leaving it unclear what – if any – the penalty will be met by Netflix.
The service appealed against this ruling, but recently received a third similar lawsuit, this time from Activision Blizzard. "Employee mobility and open, fair competition are the foundation of California's innovation and economic prosperity," said Netflix's representative. "We strongly disagree with the judge's ruling, which in our opinion erroneously allows Viacom to apply unfair and illegal contract terms that prevent employees from taking up their own work."