Damning evidence has emerged in the class-action civil lawsuit against Google, Apple, Pixar, Lucasfilm, Adobe, Intel, and Intuit. The plaintiffs claim that the companies conspired to eliminate competition for skilled labor.
John Constine writes for TechCrunch:
Next week a class-action civil lawsuit will be heard in San Jose to determine if Google, Apple, Pixar, Lucasfilm, Adobe, Intel, and Intuit conspired to eliminate competition for skilled labor. In anticipation of the hearing, TechCrunch has attained evidence from the Department of Justice’s investigation in 2010 which was made public this evening for the first time. It appears to support the plaintiff’s case that the defendant companies tried to suppress employee compensation by entering into “no poach” agreements.
Previously, only the DOJ was privy to the evidence, so there was no way for the public to know whether the settlement came out the defendants’ fear they would lose. Now we know the C-level management at these companies did enter into anti-competitive agreements.
The evidence states that the defendants agreed the following: Not to poach employees from each other, or give them offers if they voluntarily applied. They agreed to notify current employers if an employee was trying to switch companies. Also, they agreed not to enter into bidding wars and limit the ability of employees to negotiate for higher salaries.
Constine adds, “In one particularly juicy piece of evidence from May 2005, Adobe’s CEO Bruce Chizen emailed Steve Jobs regarding ‘Recruitment of Apple Employees’. In the message, Adobe’s SVP for human resources writes ‘Bruce and Steve Jobs have an agreement that we are not to solicit ANY Apple employees, and vice versa.‘”
Documents also state that there is “strong evidence that the companies knew about the other express agreements, patterned their own agreements off of them, and operated them concurrently with the others to accomplish the same objective.”
Lori McAdams of Pixar wrote an internal email to others at Pixar in April 2007 stating, “I just got off the phone with Danielle Lambert [of Apple], and we agreed that effective now, we’ll follow a Gentleman’s agreement with Apple that is similar to our Lucasfilm agreement.”
The defendants are asking the court to dismiss the case, saying that the DOJ found “no overreaching conspiracy”. The DOJ settled with the companies in September 2010, announcing that the companies would cease such illegal hiring practices, even though they hadn’t had to admit to wrongdoing.
The plaintiffs seek damages for any salaried employee who worked for one of the defendants during a 4 year period in the late 2000s. A lot of Silicon Valley workers could receive payouts if the defendants settle or lose the case.
The lawyers stand to make a bundle either way.