Antitrust Lawyer Blog Commentary on Current Developments

Silicon Valley Firms Settle Anti-Poaching Class Action Case

On April 24, 2014, Apple, Google, Intel and Adobe agreed to settle a major antitrust case regarding an alleged no employee-poaching agreement in an effort to lower employee compensation.

According to the lawsuit, Apple, Google, Intel, Adobe, Intuit, Pixar and LucasFilm signed a no-solicitation agreement dating from as far back as 2005. These companies agreed to create “no-contact” lists for their recruiters, keeping those on the list off-limits for employee recruitment efforts.

Intuit, Pixar and LucasFilms (whose employees comprise 8% of the total of 60,000 people involved in the class action case) have previously settled for $20 million. The current settlement comes on the heels of the commencement of a Department of Justice (“DOJ”) investigation into the agreements. None of the defendants admitted to any wrongdoing.

According to the lawyer of one of the defendants, the reason for settlement was to prevent a possibility of a jury verdict in favor of the plaintiffs. The plaintiffs asked $3 billion in damages, which could have been tripled to $9 billion under current anti-trust rules.

It has also suggested that the executives of the defendant companies did not wish to testify about their internal hiring practices in open court.

Apple, Google, Intel and Adobe will pay a total of $324 million to settle the lawsuit.

 

Andre Barlow
202-589-1838
abarlow@dbmlawgroup.com

Mark Ye
202-589-1834
mye@dbmlawgroup.com