4 Tech Titans Settle Wage Lawsuit; The Companies Were Accused of Conspiring Not to Recruit One Another’s Workers

(Los Angeles Times)  Apple Inc., Google Inc., and two other companies have tentatively settled an antitrust lawsuit that accused the tech giants of artificially suppressing wages by conspiring not to poach one another’s talent.

The lawsuit, filed on behalf of more than 64,000 technical employees, claimed that Apple, Google, Intel Corp., and Adobe Systems Inc. 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.

Joseph Saveri, the attorney suing the tech companies, said the settlement agreement still had to be approved by the court, and its details may not be public until the end of May.  He would not say how much the companies agreed to pay.  The lawsuit sought $3 billion in damages, a sum that could have tripled because it’s an antitrust case.

“I think this is an excellent result. We’re proud of it,” he said.

If the documents that already surfaced were any indication, the imminent trial could have caused further embarrassment for the four tech giants.  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 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 lawsuit followed a 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 another exchange, 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.

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.”

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, they could have argued that they were collaborating on a product, and poaching one another’s talent would have been disruptive to that goal, he said.

(Reporting by Robert Faturechi)