Four prominent IT companies together paid $324 million to settle a class action lawsuit alleging they conspired not to hire each other’s employees to hold down salaries.
Adobe (ADB), Apple (AAPL), Google (GOOG) and Intel (INTC) together ponied up some $324 million to settle a class action lawsuit alleging the companies colluded to hold down salaries by not hiring each other’s employees, according to a Reuters report.
The original claim resulted from five software engineers who sued the technology giants in 2011 for violating antitrust laws by secretly agreeing not to compete for each others’ workers. The case hinged on emails in which Apple's late co-founder Steve Jobs, former Google chief executive and current executive chairman Eric Schmidt and other Silicon Valley rivals agreed not to poach each other's top engineers.
Last October, U.S. District Judge Lucy Koh—the same presiding judge in the Apple-Samsung patent infringement trials—allowed the case to proceed as a class action, an order the tech giants appealed, claiming the suit covers employees with 2,400 job titles at seven different companies.
In January, the 9th Circuit Court of Appeals denied the appeal and cleared the lawsuit to proceed as a class action against the IT heavyweights. Damages in the case could have run to $9 billion if the workers had proved that the Valley’s prominent technologies companies invoked an “overarching conspiracy” not to recruit or hire each others’ talent to hold down their mobility and pay.
The proceedings were set to begin May 27. According to the Reuters report, the companies are required to disclose settlement terms by that date pending Judge Koh’s approval. It's unclear whether the vendors will reveal how much each has pitched in to settle the case.
Intuit (INTU) and Disney properties Pixar and Lucasfilm previously reached settlement agreements with the plaintiffs reportedly for a total of about $20 million.
Apple, Google and Intel refused comment on the settlement but Adobe said it settled to skirt the “uncertainties, cost and distraction of litigation," the Reuters report said. The plaintiff’s attorney described the deal as "an excellent resolution."