The lawsuit depicts Jobs as the mastermind behind the agreement. One email cited by the plaintiffs from 2007 involves Jobs writing to Schmidt about poaching, saying “I would be very pleased if your recruiting department would stop doing this.” Schmidt forwarded the request down the chain of command, writing “I believe we have a policy of no recruiting from Apple and this is a direct inbound request. Can you get this stopped and let me know why this is happening? I will need to send a response back to Apple quickly so please let me know as soon as you can.”
On the second attempt, U.S. District Judge Lucy Koh accepted a settlement in a lengthy class-action battle between technology workers and four of the largest Silicon Valley based companies: Apple, Intel, Google, and Adobe. The parties agreed to a $415 million settlement, which Koh called “fair and reasonable” as she approved it on Wednesday. This was a far different tone than in August 2014, when the judge rejected terms of a $324 million settlement on grounds that it was an inadequate amount for the approximately 64,000 workers in the class. Koh however, only granted half of the requested $81 billion in legal fees for the employees’ attorneys. The amount of fees billed was subject of controversy between the various firms representing the plaintiffs, with firm accusing another of questionable billing practices. The settlement equates to roughly $5,770 per employee, and about a $700 increase for each plaintiff from last year’s proposal. According to the Wall Street Journal, the case which began in 2011 involved 36,215 billable attorney hours and 3.2 million pages of legal documents.
The settlement involved a common practice of refusing to hire former employees of the other major tech firms. The plaintiffs alleged that CEOs like Apple’s Steve Jobs and former Google executive and current Alphabet CEO Eric Schmidt conspired between 2005 and 2009 to prevent a culture of employee-poaching. The employees argued that the agreement prevented them from moving up within the Silicon Valley ranks and earning higher salaries. The lawsuit depicts Jobs as the mastermind behind the agreement. One email cited by the plaintiffs from 2007 involves Jobs writing to Schmidt about poaching, saying “I would be very pleased if your recruiting department would stop doing this.” Schmidt forwarded the request down the chain of command, writing “I believe we have a policy of no recruiting from Apple and this is a direct inbound request. Can you get this stopped and let me know why this is happening? I will need to send a response back to Apple quickly so please let me know as soon as you can.”
The case actually began when a former Lucasfilm software engineered filed a suit regarding the conspiracy involving seven companies altogether, including Lucasfilm studios, along with the aforementioned tech companies, as well as Intuit and another studio, Pixar. Lucasfilm, Pixar, and Intuit all agreed to contribute to a $20 million settlement for their share of liability in 2014. Intel spokesman Chuck Mulloy wrote in an email statement in January, “We deny the allegations contained in the suit and we deny that we violated any laws or that we have any obligation to the plaintiff. We elected to settle the matter in order to avoid the risk, burdens and uncertainty of ongoing litigation.” While Intel refused to comment on Judge Koh’s approval, Adobe replied to CNET’s request for comment with a statement that reads:
“Adobe firmly believes that our recruiting policies have in no way diminished competition for talent in the marketplace. Adobe strongly denies that it violated any laws or engaged in any wrongdoing. Nevertheless, we elected to settle this matter in order to avoid the uncertainties, cost and distraction of litigation. We are pleased to have the matter resolved.”
The anticompetition agreement was terminated after a 2009 Justice Department investigation which resulted in a 2010 agreement between the companies not to “cold call” employees working for other firms.
Sources:
CNET – Lance Whitney
Christian Science Monitor – Michael Liedtke/Associated Press
San Jose Mercury News – Howard Mintz
Wall Street Journal Law Blog – Jeff Elder
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