Court Refuses Dismissal of Apple, Google Hiring Antitrust Suit

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Apple vs. Antitrust
A federal judge denied a request to dismiss a private antitrust suit against Apple, Google, Intel, Pixar, Adobe, Lucasfilm, and Intuit on Wednesday. The decision clears the way for the suit that was launched by five Silicon Valley engineers to progress.

This suit is separate from a 2010 settlement with the DOJ involving these same companies. That settlement resulted in the ending of so-called “do not cold call” agreements between the companies, but the private suit alleges that damage was done to engineers and other high tech employees during the years they were in place.

The agreements were more or less gentlemen’s agreements between the companies that were designed to keep them from poaching one another’s employees. That resulted in limiting both pay and job mobility by eliminating the normal forces of competition for labor, according to the plaintiffs.

“The fact that all six identical bilateral agreements were reached in secrecy among seven defendants in a span of two years suggests that these agreements resulted from collusion, and not from coincidence,” Judge Lucy Koh said in court documents uncovered by Reuters..

That’s the same Judge Lucy Koh who is currently presiding over the patent battle royal between Apple and Samsung. Earlier this week, she got those two companies to agree to settlement talks involving Apple CEO Tim Cook and Samsung CEO Choi Gee-sung.

As an example of the gentlemen’s agreement nature of the anti-poaching agreements, Reuters noted one story involving the late Steve Jobs and then Google-CEO Eric Schmidt that took place in 2007.

“I would be very pleased if your recruiting department would stop doing this,” Mr. Jobs wrote in an e-mail to Mr. Schmidt, who was that time still a member of Apple’s board of directors.

According to court documents, Mr. Schmidt forwarded that email to Google staff members, asking them to “get this stopped.”

In the end, the Google employee who was doing the recruiting was fired, and the staffing director for the search giant asked Mr. Schmidt to, “Please extend my apologies as appropriate to Steve Jobs.”

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