Judge: $324Mln Anti-Poaching Deal Too Low

Happy hour started early this Friday for Silicon Valley tech workers. U.S. District Judge Lucy Koh rejected as too low a proposed $324 million settlement of the anti-poaching class action against Apple, Google, Adobe and Intel.

Both sides had agreed to end the class action claims that the companies colluded against 64,000 tech workers who claimed the firms agreed not to poach each other’s workers, in effect keeping wages down.

In her ruling Friday, Koh said the class workers would receive less proportionally than the $20 million pact made with LucasFilm, Pixar and Intuit, which settled out of the same case last year.

Kohn said, in fact, the workers’ case had gotten stronger since the earlier settlement was inked.

The plaintiffs were expected to seek $3 billion in damages, which could be tripled under antitrust law.

“The evidence of defendants’ rigid wage structures and internal equity concerns, along with statements from defendants’ own executives, are likely to prove compelling in establishing the impact of the anti-solicitation agreements: a class-wide depression of wages,” she wrote.

“In light of these evidence, the court is troubled by the fact that the instant settlement with remaining defendants is proportionally lower than the settlements with the settled defendants,” she said.

Apple, Google, Adobe and Intel waited until just a month before trial to reach a settlement.

“While the unpredictable nature of trial would have undoubtedly posed challenges for plaintiffs, the exposure for defendants was even more substantial, both in terms of the potential of more than $9 billion in damages and in terms of other collateral consequences including the spotlight that would have been placed on the evidence discussed in this order and other evidence and testimony that would have been brought to light,” she said.

To be sure, there may have been weaknesses in the plaintiffs’ case they could not reveal to the court, she said, but added she concluded the defendants should pay their “fair share” compared with the earlier settled defendants.

Case:  In re High Tech Employee Antitrust Litigation, No. 11-cv-2509LHK



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