Netflix Hits Former Exec With Lawsuit Over Alleged Vendor Kickbacks

Netflix has filed a lawsuit against its former Vice President of IT Operations Mike Kail over allegedly receiving kickbacks from vendors. Kail left the video streaming company back in August and soon after was announced as Yahoo's new Chief Information Officer, a role in which he is still serving. According to a lawsuit filed by Netflix in California on Monday, Kail was receiving commissions from monthly fees Netflix paid to two IT service companies and then funneling the money through his own consulting company.

The lawsuit was spotted by the folks at Re/code who report that Netflix has declined commenting on the matter. According to the lawsuit, Kail set up Netflix contracts with IT service companies NetEnrich and Vistara and then received between 12-percent and 15-percent in commissions on the fees Netflix paid to the business every month.

The video streaming service says it paid $3.7 million total to both companies from 2012 until when Kail left, something that could have potentially resulted in $450,000 to $560,000 being directed to the former executive. According to the lawsuit, Netflix also thinks kickbacks from other companies could have been made to Kail, and that they could have been provided in the form of gift certificates or stock, among other things.

The alleged kickbacks received from NetEnrich and Vistara were funneled through a consulting company called Unix Mercenary, according to the lawsuit, which is said to be under Kail's control.

SOURCE: Re/code