DreamWorks Settles Animators Anti-Poaching Class Action for $50 Million

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DreamWorks Animation has reached a $50 million settlement with a Class of former animation and visual effects employees who accuse the company and others of violating antitrust laws by engaging in an illegal “no poaching” agreement.

According to court documents, the employees asked the court to grant preliminary approval of the $50 million settlement, stating it was fair and reasonable compensation for the Class Members.

“The Proposed Settlement Agreement was the product of a thorough assessment of the strengths and weaknesses of plaintiffs’ case,” the animators said. “It reflects nearly two years of discovery, uncovering the intricacies of a multi-faceted conspiracy.”

Under the terms of the proposed settlement, DreamWorks will provide a cash payment of $50 million to a settlement fund.

The Class includes certain animation and visual effects workers who worked at DreamWorks from 2004 to 2010; Pixar from 2004 to 2010; Lucasfilm from 2004 to 2010; The Walt Disney Co. from 2004 to 2010; Sony Pictures Animation and Sony Pictures Imageworks from 2004 to 2010; Blue Sky from 2005 to 2010; and ImageMovers from 2007 to 2010.

The plaintiffs’ attorneys may ask for up to 30 percent of settlement funds for attorneys’ fees. If the court approves, each of the named plaintiffs would receive up to $10,000.

The settlement still must be approved by U.S. District Judge Lucy Koh. A hearing is scheduled for Jan. 19.

Plaintiffs Robert Nitsch (a former DreamWorks Animation senior character effects artist), David Wentworth (a former ImageMovers Digital production engineer), and Georgia Cano (a digital artist who held jobs at Walt Disney Feature Animation and ImageMovers Digital) filed a consolidated class action complaint on Dec. 2, 2014.

They similarly allege that DreamWorks Animation, ImageMovers Digital, Lucasfilm, Pixar, Sony Pictures Animation, The Walt Disney Company, BlueSky Studios, and more entered into a “gentleman’s agreement” not to actively solicit each other’s employees.

Plaintiffs pushed for class certification contending that the collusion not to poach employees dates back to the mid-1980s when Pixar was formed.

Other companies then joined the conspiracy, the lawsuit states, with agreements on such things as cold calling and notifying each other when making an offer to an employee of another company.

The DreamWorks settlement follows two other recent settlements with BlueSky and Sony reached with the plaintiffs.

First, BlueSky reached a $6 million settlement and then Sony came to a $13 million deal to resolve the allegations over the wage-fixing and anti-poaching agreement. Both companies’ deals do not represent an admission of any liability of wrongdoing.

These earlier settlements were given final approval earlier this year by U.S. District Judge Lucy H. Koh. The cases against the other defendants, Walt Disney Co., Lucasfilm, Pixar and ImageMovers, are still pending.

DreamWorks and the other defendants’ involvement in this seemingly antitrust behavior allegedly came out of the now settled $415 million Department of Justice investigation into tech companies Apple, Google, Intel, Adobe and Intuit over their own purported agreement not to poach each others employees and to keep wages at a certain level.

The animators are represented by Jeff D. Friedman, Shana E. Scarlett, Steve W. Berman and Ashley A. Bede of Hagens Berman Sobol Shapiro LLP; Marc M. Seltzer, Matthew R. Berry, Jordan Talge and John E. Schiltz of Susman Godfrey LLP; and Daniel A. Small, Brent W. Johnson and Jeffrey B. Dubner of Cohen Milstein Sellers & Toll PLLC.

The Animation Workers Anti-Poaching Class Action Lawsuit is In re: Animation Workers Antitrust Litigation, Case No. 5:14-cv-04062, in the U.S. District Court for the Northern District of California.

UPDATE: On Jan. 31, 2017, The Walt Disney Company, Pixar, and Lucasfilm have reached a $100 million settlement in a class action lawsuit filed by animation and visual effects workers claiming the companies violated antitrust laws by conspiring to suppress wages via non-poaching agreements.

UPDATE 2: On May 18, 2017, a California federal judge said she may sanction two Disney producers who objected to a $170 million settlement that would resolve an antitrust class action lawsuit alleging Disney, DreamWorks, Pixar and other studios agreed not to poach the other companies’ animation workers.