Apple, Google Anti-poaching Lawsuit gets Class Action Status

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U.S. Federal Judge Lucy Koh has granted class action status to a lawsuit against Apple and Google alleging the companies struck an anti-poaching deal that ultimately left workers stuck at lower pay rates since employers weren't competing for their skills. The civil case claimed that the two companies, along with Adobe, Pixar, Intuit, and Lucasfilm, all agreed to not actively recruit from each other between 2005 and 2009.

Apple and Google face class action suit for employee anti-poaching practicesApple and Google face class action suit for employee anti-poaching practices

The lawsuit followed a 2010 Department of Justice settlement the companies agreed to where they're blocked from entering into anti-hiring deal with each other.

Judge Koh, who is also overseeing Apple and Samsung's ongoing mobile device patent infringement lawsuits, agreed last August to let the civil case brought by software engineers to move forward, although at the time she didn't grant class action status.

She said at the time,

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.

Apple CEO Tim Cook was ordered to provide a deposition in the case in January 2013, and former Palm CEO Ed Colligan later testified that Steve Jobs threatened his company with patent-related lawsuits if he tried to poach Apple employees.

The class action status was granted this week after a failed attempt last spring. At the time, the plaintiffs weren't able to adequately show they were all negatively impacted by the anti-poaching deals. The new evidence they presented this week, however, was enough to shaw Judge Koh into changing her mind.

Intuit, Walt Disney which now owns Pixar, and Lucasfilm have all struck tentative settlements in the case. Intuit agreed to pay out US$11 million, while Disney and Lucasfilm will chip in to add another $9 million to the settlement pot, according to Bloomberg.

Apple and Adobe have not commented on the case, although Google commented, "We have always actively and aggressively recruited top talent."

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Employee anti-poaching deals between companies make sense on paper because it helps cut down on lost investment and retraining as people continually move from business to business. The downside is that workers tend to get stuck at lower pay rates than they would otherwise enjoy, and if your bosses are clearly collaborating with competitors to keep sweet deal offers from coming in, well, that's a violation of antitrust laws.

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