Over the years, Disney has seen its fair share of lawsuits — typically coming from theme park guests, dissatisfied customers, other entertainment companies, small creators, and even President Donald Trump. Disney has also filed its own lawsuits, many against the state of Florida, accusing the state of overcharging the company on things like property taxes.
However, this time, Disney is not only suing another major company, but it is also suing one of its own former employees.
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For more than two decades, Justin Connolly was the head of Disney Platform Distribution, which means that he was responsible for managing all third-party media sales initiatives related to distribution strategy, affiliate marketing, and associated business functions across Disney’s portfolio of direct-to-consumer platforms—including Disney+ and the forthcoming standalone ESPN service—as well as its traditional linear TV networks.
Additionally, he oversaw Disney’s content licensing deals across general entertainment, studio productions, and sports programming.
Just days ago, Mr. Connolly announced that he would be departing the Mouse House to join YouTube in the newly created position of Global Head of Media and Sports.
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Unfortunately, for Mr. Connolly and YouTube, Disney was not behind the executive’s big move.
On May 22, Disney filed a lawsuit with the Los Angeles Superior Court, attempting to block Mr. Connolly from working for YouTube. According to reports, Disney is alleging breach of contract, tortious interference with contractual relations, and unfair competition. The company argues that Mr. Connolly could leak confidential information and/or trade secrets just before Disney is set to enter into contract renewals with YouTube.
Disney further claimed that Mr. Connolly entered into a contractual agreement with Disney last year, in which his contract was extended through 2027. The contract also contained a non-compete clause, which prevented Mr. Connolly from engaging in deals with competitors, like YouTube.
Disney further accused YouTube of “inducing” Mr. Connolly into violating his contract.
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Per a report from The Hollywood Reporter:
Disney learned of YouTube’s offer in April during a critical time in Connolly’s 20 year plus long tenure in which the company was in the midst of several important product launches and renegotiations of some of its largest distribution deals, according to the lawsuit. Notably, Connolly leads the Disney team negotiating a license renewal with YouTube.
“Connolly has intimate knowledge of Disney’s other distribution deals, the financial details concerning Disney’s content being licensed to YouTube, and Disney’s negotiation strategies, both in general and in particular with respect to YouTube,” writes Kevin Gaut, a lawyer for Disney, in the complaint. “It would be extremely prejudicial to Disney for Connolly to breach the contract which he negotiated just a few months ago and switch teams when Disney is working on a new licensing deal with the company that is trying to poach him.”
Mr. Connolly reportedly gave Disney his notice last week. During that time, he was asked outright if he was going to work for YouTube, and he allegedly refused to answer the question.
Neither Disney, YouTube, nor Mr. Connolly has issued a public statement regarding the lawsuit.
Do you think Disney should be allowed to block Mr. Connolly’s hiring at YouTube? Does his insider information pose a threat to Disney, and do you think it could affect how the company negotiates with YouTube? Let us know your thoughts in the comments!
The post Disney Sues YouTube, Accuses Competitor of Poaching Executive appeared first on Inside the Magic.
