Technology companies including Apple and Google on Thursday agreed to settle an embarrassing antitrust lawsuit that exposed the dark side of Silicon Valley’s hiring practices and alleged some of its biggest names colluded in order to avoid poaching each other's talent.
Apple, Adobe, Google and Intel had been scheduled to go to trial at the end of May, with lawyers for roughly 64,000 workers alleging that bosses including Google’s Sergey Brin and Eric Schmidt and Apple's Steve Jobs orchestrated an elaborate scheme to prevent poaching and drive down wages.
The companies had acknowledged that they agreed not to hire each other's staff in some cases, but disputed the allegation that they conspired to drive down wages.
In 2010, a Justice Department investigation concluded that several companies shared confidential salary information to prevent bidding wars and promised not to call each other's staff. After the companies settled the federal antitrust complaint, the four tech giants became the target of a civil lawsuit.
Lawyers had been seeking $3bn in damages. Under antitrust rules, that could have been tripled to $9bn had the companies lost. The terms of the settlement will be presented by 27 May to US district judge Lucy Koh.
The settlement was confirmed by Kelly Dermody, a lawyer for the plaintiffs at Lieff Cabraser Heimann & Bernstein.
"This is an excellent resolution of the case that will benefit class members," she said in a statement.
Emails from Jobs and Schmidt emerged in pre-trial hearings. In one example, Schmidt told Jobs that a Google recruiter would be fired after approaching an Apple employee. Jobs forwarded Schmidt's note to a top Apple human resources executive, with a smiley face.
In another 2005 email exchange, Jobs reportedly told Google co-founder Brin: "If you hire a single one of these people, that means war."
Lawyers for the companies accused the plaintiffs of “free-floating character assassination” and asked that the emails be barred from entry at the trial.
Walt Disney's Lucasfilm and Pixar – previously headed by Jobs – and the software company Intuit agreed to a settlement over the same hiring practice allegations last July, with Disney paying about $9m and Intuit $11m.
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