Activision Sues Netflix Over Hiring of Former Finance Chief (1)

Video game publisher Activision Blizzard Inc. sued Netflix Inc., claiming the video-streaming service engaged in a yearslong campaign of unlawfully poaching executives, including by hiring its former chief financial officer.

Activision claims Netflix interfered with the contact of the executive, Spencer Neumann, by offering to pay him in advance to cover his legal fees.

Spencer Neumann.

Source: The Walt Disney Co.

“Netflix unapologetically recruits talent without regard to its ethical and legal obligations,” Activision said in the complaint filed Friday in state court in Los Angeles.

Activision is suing for intentional interference, unfair competition, and aiding and abetting. It seeks a court order to permanently stop Netflix from soliciting Activision employees and unspecified compensatory and punitive damages to be determined by a jury at trial.

Netflix and Activision both declined to comment on the lawsuit.

Read more: Netflix’s culture and its drive to hire the best

Neumann hopped from Activision to Netflix at the beginning of 2019 after he was abruptly put on leave by the video-game maker in anticipation of the move. He had joined Activision in May 2017 from Walt Disney Co., where he served as CFO of that company’s theme-park division.

In the suit, the game publisher said it’s concerned that -- as Netflix creates video games based on its shows -- it “increases its competition with Activision.” Netflix shows have already become games such as “Stranger Things 3: The Game” and “The Dark Crystal: Age of Resistance.”

The video-gaming market has exploded during the Covid-19 pandemic, as many other forms of entertainment became unaccessible. Video games should generate nearly $160 billion in revenue globally this year, up 9.3%, according to research firm Newzoo. The launch of new gaming consoles from Microsoft Corp. and Sony Corp. this fall should further add fuel to the market.

(Updates with additional information on lawsuit and the video-game industry in the sixth and seventh paragraphs.)

--With assistance from Lucas Shaw.

To contact the reporters on this story:
Patricia Hurtado in Federal Court in Manhattan at pathurtado@bloomberg.net;
Olga Kharif in Portland at okharif@bloomberg.net

To contact the editors responsible for this story:
David Glovin at dglovin@bloomberg.net;
Nick Turner at nturner7@bloomberg.net

Joe Schneider, Steve Stroth

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