Apple, Google, Intel, Adobe to pay $325 mln to settle hiring lawsuit

Sat May 24, 2014 2:24am IST

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A woman walks past the Google Chicago headquarters logo in Chicago, March 20, 2012.

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REUTERS - Four major Silicon Valley companies have formally agreed to pay $324.5 million to settle claims brought by employees who accused them of limiting competition by colluding not to poach each other's talent.

The settlement, between Apple Inc (AAPL.O), Google Inc (GOOGL.O), Intel Corp (INTC.O), Adobe Systems Inc (ADBE.O) and roughly 64,000 workers, was disclosed in papers filed late on Thursday with a federal court in San Jose, California.

U.S. District Judge Lucy Koh has been asked to preliminarily approve the accord at a June 19 hearing, over an objection by one of the four named plaintiffs, Michael Devine, who says the settlement let the companies off too easily.

The payout was originally reported by Reuters but not officially confirmed.

Lawyers for the plaintiffs may seek up to 25 percent of the settlement amount in legal fees.

Filed in 2011, the lawsuit accused Silicon Valley companies of conspiring to limit competition and keep wages down for engineers, programmers and other technical staff.

The case has been closely watched because of the potential $9 billion of damages sought, and its occasional embarrassing revelations into how Silicon Valley operates.

Among the communications that became public were pointed emails from Apple co-founder Steve Jobs that at times admonished then-Google Chief Executive Eric Schmidt to stop raiding his company.

Thursday's settlement gives workers only a few thousand dollars each on average.

The companies' combined profit in their latest fiscal years was about $60 billion, with three-fifths coming from Apple.

In court papers, two law firms representing the plaintiffs said Devine's objection should not doom what they consider a fair and reasonable settlement for an antitrust case, and which serves the best interests of the class.

They pointed to a July 2012 jury verdict in the same court that found Toshiba Corp (6502.T) conspired to fix prices in the liquid crystal display market but awarded just $87 million of damages, one-tenth of what was sought.

"The amount of the settlement does not relate to the size or profitability of the companies we sued," Joseph Saveri, a lawyer for the plaintiffs, said in an interview. "It relates to the claims we made, the law that applies to them, and the facts that we could prove at trial. Based on that, I think the settlement is a significant achievement."

Devine did not immediately respond on Friday to a request for comment.

Koh on May 16 approved separate settlements totaling $20 million over alleged poaching by Walt Disney Co's (DIS.N) Lucasfilm and Pixar units, and by Intuit Inc (INTU.O).

The case in U.S. District Court, Northern District of California is In re: High-Tech Employee Antitrust Litigation, 11-02509.

(Reporting by Jonathan Stempel in Toronto; Additional reporting by Dan Levine in San Francisco; Editing by Paul Simao)

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Comments (1)
vatsayan wrote:
This has been always been a controversial issue. Poaching employees affects the employer’s business, even makes vulnerable to losing the corporation’s sensitive information; while on the other hand secret agreements among corporations limit the employee’s bargaining abilities and thus result in below par remuneration for them

May 24, 2014 11:45pm IST  --  Report as abuse
This discussion is now closed. We welcome comments on our articles for a limited period after their publication.

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