Kwatinetz is a revered figure in Hollywood and has managed the likes of Kelly Clarkson until she sacked him earlier this year.
But the statement confirmed that Kwatinetz and his colleagues at top agency the Firm have 'terminated our professional relationship with Britney Spears'.
Britney's car-crash life has dominated the press since her divorce from Kevin Federline.
Amidst a bitter custody battle and concerns over her parenting skills, Britney's shambolic performance at the MTV Video Music Awards earlier this month appeared to seal her status as a performer who has passed her prime.
Kwatinetz's statement continued: 'We believe Britney is enormously talented... but current circumstances have prevented us from properly doing our job.'
However it is possible that Britney could be a success on her own. Her comeback single Gimme More has reportedly been a big hit on American radio stations and the song has jumped straight into the top 20.
