A secret deal gone awry for tech titans.
By Raif Karerat
WASHINGTON, DC: Four of the tech industry’s most significant players — Google, Apple, Intel, and Adobe — have agreed to pay $415 million to settle a class-action antitrust case that has produced evidence showing they cut secret deals to not hire each other’s workers, effectively smothering any competition.
The proposed settlement far exceeds the $324.5 million they agreed to pay last year, which Judge Lucy Koh deemed too low. With the case set to re-open in April with a new trial, the four titans of technology are seeking to settle before any additional evidence is revealed on the record.
The “no-hire” agreements set up between the four companies allegedly stymied wages for tech workers and limited their vocational mobility. About 64,000 plaintiffs are represented by the class action lawsuit.
“Plaintiffs and settling defendants reached the settlement through hard-fought, arm’s-length negotiations after more than three years of litigation,” read court documents filed Thursday.
The lawsuit was initially filed in 2011 by former employees who accused the Silicon Valley lynchpins of carrying out an “interconnected web” of agreements to not hire each other’s workers between 2005 and 2009 in order to quash wage levels.
An un-redacted court filing from January 2012 revealed an e-mail exchange between the late co-founder and former CEO of Apple, Steve Jobs, and Eric Schmidt, who was Google’s CEO and an Apple board member at the time. During the conversation, Jobs pointedly asks Schmidt to stop trying to hire one of Apple’s engineers.
“I would be very pleased if your recruiting department would stop doing this,” Jobs conveyed to Schmidt on March 7, 2007.
According to the filing, Schmidt then forwarded the request internally, adding, “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.”
A hearing is allotted for March 19 during which Judge Koh will decide whether to approve the latest settlement offer from Google, Intel, Apple, and Adobe.
1 Comment
This is a shining example of why people are afraid to stand up against big corporations, they have a lot to lose and little to gain. The corporations know they are doing wrong, but do it anyway because in the end they know they have a lot to gain and little to lose, and will likely still make a profit short and long term, while all their consumers can do is to apply for 24/7 money help from experienced company and get another IPhone. But the worse problem is, this and the many other cases and problems are swept under the rug and everyone goes about their business of talking about how great the company is.