Apple Inc. (AAPL), Google Inc. (GOOG), Intel Corp. (INTC) and Adobe Systems Inc. (ADBE) agreed to pay $324.5 million to settle an employee antitrust lawsuit over claims they conspired to suppress salaries by not recruiting one another’s workers.
Lawyers for employees who sued the companies are seeking a judge’s preliminary approval of the deal, according to a filing in federal court in San Jose, California. The accord, covering more than 64,000 technical employees, was reached April 24. Terms were disclosed in yesterday’s filing.
Workers settled for about a 10th of the $3 billion they planned to seek at a trial that was set for May 27. Under federal antitrust law, damages won at a trial might have been tripled. The settlement equals 0.4 percent of the companies’ most recent combined quarterly revenue.
The case, which began in 2011, had become an embarrassment for some of Silicon Valley’s biggest companies by revealing behind-the-scenes brokering among top executives at the expense of their workers.
The plaintiffs, who include software and hardware engineers, programmers, digital artists and other technical staff, alleged their employers conspired from 2005 to 2009 to suppress their pay. E-mails and court documents painted an unflattering picture of tech luminaries including Steve Jobs, co-founder of Cupertino, California-based Apple, and Eric Schmidt, chairman of Mountain View, California-based Google.
Threatened War
Jobs once threatened war on Google co-founder Sergey Brin if that company hired any workers away from Apple, according to Brin’s description of a conversation cited in a court ruling.
Under the settlement, the companies would deposit $1 million into an escrow account within 10 days of preliminary court approval, with the remainder due within seven days after final court approval. The settlement includes a broad release for the companies from future claims on restrictions on competition for employment.
Lawyers for the workers intend to seek as much as 25 percent in attorneys’ fees, plus expenses of as much as $1.2 million, according to the filing. Additional award payments of $80,000 will be sought for each named plaintiff who served as a class representative.
One employee, Michael Devine, objected to the settlement and isn’t covered by the preliminary approval request, according to the filing.
In a separate filing, lawyers for the workers requested court approval to keep confidential the terms under which the companies may terminate the settlement. The deal may be undone if enough class members opt out, according to court papers.
The case is In re High-Tech Employee Antitrust Litigation, 11-cv-02509, U.S. District Court, Northern District of California (San Jose).
To contact the reporter on this story: Sophia Pearson in federal court in Philadelphia at
To contact the editors responsible for this story: Michael Hytha at mhytha@bloomberg.net Stephen Farr, David E. Rovella
Bloomberg reserves the right to edit or remove comments but is under no obligation to do so, or to explain individual moderation decisions.
Please enable JavaScript to view the comments powered by Disqus.