Ex-Palm CEO says Apple's Steve Jobs threatened patent suit in no-poaching deal

Steve Jobs was more than miffed that Apple's former iPod boss was luring staff to his new turf at Palm.
Written by Liam Tung, Contributing Writer

Former Palm CEO Edward Colligan reiterated his claim that Apple's own former-chief Steve Jobs threatened to file patent suits against the handset maker unless it agreed to stop poaching Apple's execs.

Jobs made the threat in 2007, according to a sworn statement by Colligan filed in a civil lawsuit brought by five engineers, who allege Silicon Valley's giants conspired to lower competition for talent and drive down wages, according to Reuters.

Details of Colligan's exchange with Jobs resurfaced after US District Judge Lucy Koy in San Jose, California, rejected parts of a request by tech companies to keep a range of documents secret, Reuters said.

The suit follows a settlement that the US Department of Justice reached in 2010 with six companies--Adobe, Apple, Google, Intel, Intuit, and Pixar--over non-poaching agreements that amounted to anti-competitive practices, during which Colligan also detailed the discussion with Jobs.

Koh is now deciding whether the civil suit can proceed as a class action, which could result in damages amounting to hundreds of millions of dollars.

Colligan's submission includes an email exchange between him and Jobs in late August 2007 that details his rejection of Jobs' no-poaching proposal.

The emails followed a call he claims to have received from Jobs in which the Apple co-founder "proposed an arrangement between Palm and Apple, by which neither company would hire the other's employees, including high tech employees."

"Mr Jobs also suggested that if Palm did not agree to such an agreement, Palm could face lawsuits alleging infringements of Apple's many patents," wrote Colligan.

Colligan's email outlines at length his objections to the proposal, claiming that in the year preceding Apple's iPhone launch, Apple had hired 2 percent of Palm's workforce. "To put that in perspective, had Palm done the same, we'd have hired 300 folks from Apple. Instead, to my knowledge, we've just hired three," wrote Colligan.

Jobs' emailed response stressed that he was most concerned about Apple staff being "actively recruited" by Jon Rubinstein--the former vice president of Apple's iPod business who became Palm's executive chairman in 2007, and later its CEO--and Fred Anderson, Apple's CFO between 1996 and 2004, who was by then on the board of Palm.

Colligan wrote that he was "not intimidated by your threat", pointing to Palm's patent portfolio, which included a host of Siemens' mobile patents it acquired from BenQ.

Jobs' response to the BenQ patents: "We are not concerned about them at all. My advice is to take a look at our patent portfolio before you make a final decision here."

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