Steve Jobs Threatened Patent Lawsuits to Stop Employee Poaching

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Former Apple CEO Steve Jobs apparently threatened Palm with patent lawsuits as a ploy to deter the company from luring away employees. The revelation came during a hearing for a class action lawsuit against Apple, Google, and Intel from tech industry workers alleging the companies agreed to not poach employees from each other.

Steve Jobs threatened Palm with Patent lawsuit to stop employee poachingEd Colligan, Palm's CEO when the alleged antipoaching scheme was in place, said that Mr. Jobs used the threat of patent lawsuits to try to stop Palm from hiring away Apple employees. "Mr. Jobs also suggested that if Palm did not agree to such an arrangement, Palm could face lawsuits alleging infringement of Apple's many patents," he said in a statement to the court, according to Reuters.

At the time, Palm was still an independent company. It was later purchased by HP and ultimately absorbed into the PC maker. Eventually all of its products were discontinued, leaving Palm little more than a memory in ever changing technology market.

Apple, Google, Intel, Adobe, Intuit, and Pixar all agreed to a settlement in 2010 in a U.S. Department of Justice anti-poaching case. The DOJ said the anti-poaching agreement between the companies "eliminated a significant form of competition […] to the detriment of affected employees."

The settlement blocks the companies from engaging in practices that stop recruiters from "soliciting, cold calling, recruiting, or otherwise competing for employees" for five years as a move to stop what was seen as an anticompetitive act.

Apple's current management has been drawn into the civil case, as well. Current CEO Tim Cook has been ordered to testify in a four-hour deposition.

The civil class action suit is being heard by Judge Lucy Koh, who has also been overseeing mobile device patent infringement litigation between Apple and Samsung. She is still considering whether or not to grant class action status to the civil anti-poaching case.

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This was seriously uncool. Not just collusion but threats bordering on extortion. Very very uncool.


What I think is uncool is former Apple executives like Jon Rubinstein and Fred Anderson using inside information obtained solely from their respective employments at Apple to go after and target specific Apple employees. The way I read Jobs’ email was, he wasn’t concerned about Palm hiring Apple employees, but wanted the active targeting to stop. In my mind, there is a difference between preventing an unhappy employee from trying to get a job else where, and trying to stop a competitor with inside information from actively targeting employees. Jobs seems to be addressing the later, which should be fine.

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