Apple, Google, others agree to $324.5 million settlement in wage case
The dollar amount is now on the record. Apple, Google and other tech giants accused of artificially suppressing wages by conspiring not to poach each other’s talent have agreed to settle a lawsuit filed by their employees for $324.5 million.
The approximate dollar amount, stipulated in settlement records filed in federal court late Thursday, had been an open secret in Silicon Valley in recent weeks, though attorneys had declined to confirm the figure.
It still needs to be approved by U.S. District Judge Lucy Koh in San Jose. If she does, there will surely be grumbling among tech employees who have publicly complained that Apple, Google, Intel Corp. and Adobe Systems Inc. would be losing just a fraction of the $3 billion they allegedly saved by suppressing wages.
Each class member is estimated to get a few thousand dollars.
The attorneys on the case seemed to be trying to preempt that argument. In the filing, they point out they would be getting a larger payout than the one claimed by the California attorney general’s office after an investigation into the same allegations: $0.
“While the [California Department of Justice] had the ability to seek civil fines, the DOJ settled their investigation regarding Defendants’ alleged misconduct without any monetary penalty,” read the filing.
The lawsuit, filed on behalf of more than 64,000 technical employees, claimed that Apple, Google, Intel and Adobe Systems had a pact not to recruit one another’s workers. That alleged conspiracy, spanning four years from 2005 to 2009, kept salaries down, the employees said.
The lawsuit had sought $3 billion in damages, a sum that could have tripled because it’s an antitrust case.
If the documents that have surfaced publicly are any indication, the trial would have caused serious embarrassment for the four tech giants. In a 2007 internal email that has already gone public, the chairman of Google, Eric Schmidt, emailed then-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 expressed his reaction with a smiley face: “:)”
The late Apple executive’s emoticon, and other communications between some of the tech world’s top officials, led some legal experts to believe that the tech workers had a strong case in their class-action lawsuit.
The $324.5 million comes in addition to $20 million received from settlements with Pixar, Lucasfilm, and Intuit.
“This is a significant amount of money,” said Joseph Saveri, an attorney suing the tech companies.
The lawsuit has shed light on other embarrassing exchanges. Google co-founder Sergey Brin, for example, 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.
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.”
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