Apple, Google agree to settle antitrust class action, lawyer’s office says
Apple, Google, Intel and Adobe Systems will pay $324 million to settle a lawsuit by tech workers accusing them of conspiring to hold down salaries in Silicon Valley.
The four tech giants accused of artificially suppressing wages by conspiring not to poach each other’s talent agreed to settle a major antitrust lawsuit Thursday, according to the office of one of the attorneys involved.
If the documents that already surfaced were any indication, the imminent trial would have caused further embarrassment for Apple, Google and others. In one 2007 internal email that already went public, the chairman of Google emailed Apple Chief Executive Steve Jobs to let him know that his company was going to fire a recruiter who tried to poach an Apple employee.
Upon hearing the news of the lowly recruiter’s imminent termination, Jobs curtly expressed his delight with smiling emoticon: “:)”
The late Apple executive’s emoticon, and other communications between some of the tech world’s top officials, led observers to believe the tech workers had a strong case in their class-action lawsuit.
The plaintiffs alleged that thousands of salaried employees were affected by agreements between the tech giants not to cold-call each other’s employees. That alleged conspiracy kept pay down, the employees say, and they want $3 billion in damages, a figure that could have tripled as is customary in antitrust cases.
The terms of the apparent settlement agreement were not immediately disclosed.
The lawsuit followed a U.S. Justice Department probe looking into allegations that the companies colluded to suppress wages. The companies settled those allegations in 2010, agreeing not to restrain competition for hiring high-tech talent.
Two other companies had already reached tentative settlement agreements.
In other evidence, a Google co-founder sent a message to other officials at the company to alert them that Jobs was upset about their recruiting of Apple talent. He recalled Jobs telling him, “If you hire a single one of these people, that means war,” according to the email.
In another email, Jobs was assured that a Google executive got personally involved “and firmly stopped all efforts to recruit anyone from Apple.”
Their alleged conspiracy, however, faltered in part because executives at Facebook were reluctant to join. In a deposition, Facebook Chief Operating Officer Sheryl Sandberg, who herself left Google for Facebook, said she refused to stop poaching talent: “I declined at that time to limit Facebook’s recruitment or hiring of Google employees.”
Still, Dan Eaton, a San Diego State business ethics and employment law expert, said the tech companies could have made arguments that their cooperation was legitimate. For example, he said, they could have argued that they were collaborating on a product, and poaching each other’s talent would have been disruptive to that goal.
“Right now, these are just allegations… There are a variety of possible pro-competitive rationales,” Eaton said.