Samsung, LG Argue Anti-Poaching Class Action Relies on Korean ‘Stereotypes’

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Samsung and LG are seeking to dismiss three consolidated antitrust class action lawsuits that accuse the tech giants of engaging in a secret, longstanding conspiracy to not poach each other’s employees.

In their joint motion, Samsung, LG, and related entities urged U.S. District Judge Beth L. Freeman to toss claims brought by three former LG employees, arguing that the cases are based on stereotypes regarding Korean companies and are devoid of factual allegations about the alleged antitrust conspiracy.

The tech giants assert that “in sharp contract” to other recent antitrust class action lawsuits against Apple, Google, and others in the same California district court, the plaintiffs in the LG and Samsung anti-poaching suit have not provided any evidence of communication between LG and Samsung regarding the supposed conspiracy.

“Instead, Plaintiffs predicate their hypothesis of conspiracy solely on vainglorious assertions that despite their ‘ideal qualifications,’ an unspecified Samsung entity did not recruit or hire them, on a stray and ambiguous remark of an unidentified recruiter with no alleged firsthand knowledge of the purported conspiracy, and on a news article about a supposed ‘understanding’ among unspecified LG and Samsung entities in India,” the companies state.

Furthermore, LG and Samsung argue the plaintiffs’ claims against their subsidiaries are instead propped up by stereotypes about Korean business organizations and lumps together separate corporate entities of LG and Samsung and does not allege how any particular division joined in the purported conspiracy.

Former manager LG sales manager, identified in court documents as A. Frost, initially brought the complaint in September, alleging antitrust violations.

Frost states that a recruiter reached out to him via LinkedIn in 2013, asking him to consider filling a position at Samsung. That recruiter then followed up with another message the same day, saying “I made a mistake! I’m not supposed to poach LG for Samsung!!! Sorry! The two companies have an agreement that they won’t steal each other’s employees,” Frost contends the message stated.

According to Frost, top executives at both LG and Samsung knew of the alleged anti-poaching agreement. The lawsuit also goes on to allege that it is “implausible” that LG and Samsung entered an anti-poaching agreement in the United States without the approval of each of its parent companies in South Korea.

Frost’s class action lawsuit was followed by two separate proposed class action lawsuits filed by a former LG engineer and former LG treasury manager. Both lawsuits similarly allege the companies conspired to not hire or recruit one another’s U.S. employees across all levels and were consolidated along with Frost’s in November.

A similar class action lawsuit filed against Apple and Google in 2010 recently yielded a $415 million settlement. Additionally, another antitrust lawsuit accused DreamWorks Animation SKG Inc. The Walt Disney Co., Lucasfilm Ltd. and Pixar of similar anti-poaching deals.

The workers are represented by Joseph R. Saveri, Matthew S. Weiler and Kyla J. Gibboney of Joseph Saveri Law Firm Inc, Stuart G. Gross of Gross & Klein LLP; Steven N. Williams, Adam J. Zapala and Elizabeth Tran of Cotchett Pitre & McCarthy LLP; Eric L. Cramer and Michael J. Kane of Berger & Montague PC; Vincent J. Esades of Henis Mills & Olson PLC; John Radice of Radice Law Firm PC; Jason S. Hartley, Jason M. Lindner and Julie A. Kearns of Stueve Siegel Hanson LLP; Daniel E. Gustafson, Catherine K. Smith and Brittany N. Resch of Gustafson Gluek PLLC; Kenneth A. Wexler and Amy E. Keller of Wexler Wallace LLP; Simon B. Paris and Patrick Howard of Saltz Mongeluzzi Barrett & Bendesky PC and Patrick W. Michenfelder of Throndset Michenfelder LLC.

The Samsung and LG Anti-Poaching Class Action Lawsuit is Frost v. LG Corp. et al., Case No. 5:16-cv-05206, in the U.S. District Court for the Northern District of California.