Judge rejects Apple, Google $325 million anti-poaching settlement, firms appeal

Judge rejects Apple, Google $325 million anti-poaching settlement, firms appeal

Summary: Judge Lucy Koh has rejected the offer as too low, but the companies aren't taking the decision lying down.

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Credit: Apple

Apple, Google, Intel and Adobe have attempted to settle a class-action lawsuit over Silicon Valley hiring practices, but a judge has rejected their offer as too low -- leading the companies to appeal the decision.

The companies have been accused of conspiring in a secret anti-poaching gentlemen's agreement in order to keep wages at an agreed upon level, prevent competitive hiring and reduce the risk to each firm of losing valuable, skilled employees -- as well as increasing individual profitability. The class-action lawsuit, originally filed in 2011, involves five former members of staff who claim the secret deal impacted upon their career development and opportunities.

Emailed correspondence between late Apple co-founder Steve Jobs and Google's Eric Schmidt in 2007 to prevent Apple engineer headhunting is among the evidence submitted concerning the alleged conspiracy.

Last month, a total of $324.5 million was proposed to settle the class-action lawsuit, but US District Judge Lucy Koh rejected the amount. When turning down the settlement offer, the judge -- who has also presided over other technology-related cases including patent disputes between Apple and Samsung -- said there was "substantial and compelling evidence" which placed the late co-founder of Apple Steve Jobs at the heart of the alleged conspiracy. In addition, Koh claimed the figure of $324.5 million was too low and all the defendants should "pay their fair share."

As reported by Reuters, a court filing from the firms late on Thursday appealed Koh's decision, claiming the judge "committed clear legal error" and "impermissibly substituted the court's assessment of the value of the case for that of the parties who have been litigating the case for more than three years."

The 9th US Circuit Court of Appeals has been asked to overrule Koh's decision, and a hearing before Koh has been scheduled for 10 September.

See also: Apple struck with lawsuit over missing pay packets and breaks

Read on: Apple

Topics: Apple, Google, Legal, Innovation

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14 comments
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  • No saints here ...

    ... but sad that yet again, once-sainted Steve Jobs turns out to be a devious underhand double-dealer.

    Don't get me wrong - the others are equally contemptible, just not so two-faced.
    Heenan73
    • I think "devious underhand double-dealer" is a bit harsh.

      I think that a guy who flew around the world in a company-paid Gulfstream IV private jet screwing around with the hiring of some no-name low-level engineers who'd already left Apple was pretty crappy, but I never got the feeling it was malicious so much as just a facet of his pathological need to do whatever he felt he had to in the name of protecting Apple.

      Like the options backdating, his "you're holding it wrong" response to "Antenna-gate", and arranging the dispatch of technology crime enforcement police units to the home of someone believed to be in possession of lost iPhone prototype, acting to make sure Apple engineers didn't end up someplace where their knowledge and experience could benefit a, perceived, competitor, was just something Steve did because he could, regardless of whether he should. I doubt he even put enough thought into it to qualify as 'deviousness'. More likely it was just the reflex reaction of someone with enough power to, literally, make things happen.

      Of course, that doesn't mean it wasn't $hitty.
      matthew_maurice
      • and how is that not malicious

        "just a facet of his pathological need to do whatever..." doesn't excuse such behavior or make it unintentional. So how is it not malicious? It deliberately did harm to others to benefit him and/or Apple. Sound malicious to me.
        jreuter
  • No saints here ...

    ... but sad that yet again, once-sainted Steve Jobs turns out to be a devious underhand double-dealer.

    Don't get me wrong - the others are equally contemptible, just not so two-faced.
    Heenan73
    • oops delete dupe please ..

      ... I got an error message first time, honest!
      Heenan73
  • Judge Koh is getting lots of tech law experience

    I'm sure part of it comes from serving the Bay Area, but I wonder if the chief judge of the court hasn't decided that she is the local expert (or one of them) and is therefore deliberately assigning her those sorts of cases.
    John L. Ries
    • I think she's pretty clearly sending a message to Apple.

      That message being "I know you want to settle because you're guilty as sin, and since losing in court carries triple damages potentially reaching billions, $325 million isn't going to cut it" I expect she would like to see $400-500 million, and if Apple low-balls again she might push for a quarter billion.
      matthew_maurice
      • @jgpmolloy check your math

        a quarter of a billion = 250 million which is less than the rejected offer.
        bunkport
  • Truely shameless

    Koh should stick it to all these companies hard. A message needs to be sent that the mega corps cannot get away with these types of things and that they cannot set their own penalties. Which most likely are at a cost savings over what they stole from their employees.

    Without jail time for the organizers or massive financial hits, these companies will continue to do these types of things.

    Imagine what would have happened if Jobs and the 5 heads of the publishers spent just 1 year behind bars for illegally fixing book prices. That is something any CEO would consider before engaging in such activities again. They all have massive salaries and golden parachutes, so what do they have to fear at this point.
    Emacho
    • I agree

      Punishment must be at least considerable more that what these offending companies have "won" with illegal and amoral practices.
      AleMartin
    • I think she's pretty clearly sending a message to Apple.

      That message being "I know you want to settle because you're guilty as sin, and since losing in court carries triple damages potentially reaching billions, $325 million isn't going to cut it" I expect she would like to see $400-500 million, and if Apple low-balls again she might push for a quarter billion.
      matthew_maurice
    • Let me guess: You would be perfectly OK

      with the workers for all these companies unionizing, then holding solidarity strikes against all those companies to force higher wages. I'll bet the judge wouldn't have a problem with that either.
      baggins_z
      • It's a lot easier...

        ...to organize a handful of companies into a cartel than it is to organize thousands of workers into a union. Even with the Wagner Act and union shops legal in half the states, private sector union membership has been declining for a half century.

        The reason why the rules are different for vendors and employers than for consumers and employees is that it's a lot easier for the first two groups to collude than for the last two groups to.
        John L. Ries
  • Reminds me of "Surely, Mr. Feinman, you're joking."

    "impermissibly substituted the court's assessment of the value of the case for that of the parties who have been litigating the case for more than three years."

    Duh !!! The JUDGE *is* the fact finder in a "trial to the bench"! If the parties didn't provide convincing evidence that their position is correct, it's THEIR problem, not the JUDGE'S!
    Rick_R