U.S. probes hiring in tech
The Justice Department has launched a preliminary investigation into whether some of the nation’s largest technology companies violated antitrust laws by negotiating the recruiting and hiring of one another’s employees, according to two people with knowledge of the review.
The probe is focused on search engine giant Google Inc., rival Yahoo Inc., iPhone maker Apple Inc., biotech firm Genentech Inc. and others, said the sources, who described the inquiry as “industrywide” and spoke on condition of anonymity because the investigation was continuing.
Justice Department officials declined to comment, as did officials from Google and Yahoo. Apple and Genentech didn’t immediately respond to requests for an interview.
If companies agree not to hire away top talent, they could be illegally stifling the normally fierce competition for top engineering professionals and business executives, antitrust experts said.
“This could be collusive restraint on trade, which could have a serious impact on competition,” said Albert Foer, president of the American Antitrust Institute.
The review is the latest move by the Obama administration to step up scrutiny of possible anticompetitive actions in the high-tech sector. The industry has disrupted traditional business models of advertising, entertainment and news, and companies such as Google and Facebook Inc. have amassed strong market shares in specific segments of the industry.
The Justice Department last month launched a review of the board ties between Google and Apple. The Federal Trade Commission has initiated a review of Google’s settlement with book authors and publishers on digital records of their works.
Obama’s antitrust chief at the Justice Department, Christine Varney, has said she plans to look at how tech companies’ grasp on markets may have cut out competitors and hurt consumers. Legal experts say the targets could include wireless carriers that may be blocking certain applications on their networks and devices.
Google is known for its exhaustive recruiting process to find people who fit into its culture and create innovative Web technologies. In 2005, Microsoft Corp. sued Google for hiring away a Microsoft executive.
