Apple, Google Reach Settlement in Anti-Poaching Lawsuit

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Google Inc., Apple Inc., Intel Corp. and Adobe Systems Inc. have made another attempt at a class action settlement agreement in an anti-poaching class action lawsuit, after the last proposal was rejected by a California federal judge.

A letter was sent to the court clerk for the Ninth Circuit Court of Appeals by one of the attorneys representing Google explaining that “the parties have reached a new settlement agreement that is subject to district court approval,” adding that the court should be receiving “a motion for preliminary approval” that will be filed by the plaintiffs “imminently.”

The parties in the anti-poaching class action lawsuit presented a $324.5 million class action settlement to U.S. District Judge Lucy H. Koh in August 2014, which she rejected saying that proposal was too low and should be at least $55 million more.

It was also protested by plaintiff Michael Devine, who is one of the five lead plaintiffs in the anti-trust class action lawsuit against the tech companies. He argued that the first proposal wasn’t enough to serve as a deterrence to prevent similar anti-trust behavior in the future.

The New York Times is reporting that a source close to the deal says that the new class action settlement proposal in $415 million and is reportedly acceptable to the plaintiffs.

Devine, who worked for Adobe, told The Times that it is at least a lot closer to where it should be, and that he does not plan to oppose the proposed settlement.

“A reasonable person could go either way on whether it is adequate,” he added.

The class is made up of about 64,000 tech engineers. After the attorneys receive their fees, which is expected to be about 25 percent of the total settlement, the class members will still only receive a few thousand dollars each.

The original anti-trust class action lawsuit was filed against Adobe, Apple, Google, Intel, Intuit, Lucasfilm, and Pixar in May 2011 after the Justice Department revealed what it learned following an anti-trust investigation, in which the the senior executives of the tech companies had apparently struck deals with each other not to hire employees from each others’ companies. The agreement also allegedly led to de facto salary caps and prevented upward mobility.

It was alleged that the anti-poaching agreement led to a 10 to 15 percent reduction in salaries for tech engineers.

Intuit, Lucasfilm and Pixar paid $20 million in a class action settlement in May 2014, which was approved by Judge Koh.

The tech companies were interested in reaching a settlement in the anti-poaching class action lawsuit to avoid a trial, which could result in the exposure of embarrassing emails between top officials at Apple, Google, Intel, Adobe, Intuit and the others, in which the deals were allegedly struck.

However, Judge Koh unsealed some of those emails in January 2014, which showed that the agreements allegedly went as high as Google CEO Eric Schmidt and former Apple CEO Steve Jobs, who died in 2011.

The practice allegedly began back in 1986 with Lucasfilm and Pixar.

The anti-trust class action lawsuit will be brought to an end, if Judge Koh agrees to the settlement proposal.

The software engineers are represented by Kelly M. Dermody, Richard M. Heimann, Brendan Glackin, Dean Harvey, Anne B. Shaver and Lisa J. Cisneros of Lieff Cabraser Heimann & Bernstein LLP and Joseph R. Saveri, James Dallal and Andrew Purdy of Joseph Saveri Law Firm Inc.

Apple is represented by George A. Riley, Michael F. Tubach and Christina J. Brown of O’Melveny & Myers LLP. Google is represented by Donald M. Falk, Lee H. Rubin, Edward D. Johnson and Kristen A. Rowse of Mayer Brown LLP and Robert Van Nest, Daniel Purcell, Eugene Paige and Justina Sessions of Keker & Van Nest LLP. Intel is represented by Gregory P. Stone, Bradley S. Phillips, Gregory M. Sergi and John P. Mittelbach of Munger Tolles & Olson LLP. Adobe is represented by Robert A. Mittelstaedt, David C. Kiernan and Lin W. Kahn of Jones Day.

The Anti-Trust Class Action Lawsuit is In re: High-Tech Employee Antitrust Litigation, Case No. 5:11-cv-02509, in the U.S. District Court for the Northern District of California. The petition for review is Adobe Systems Inc. et al. v. U.S. District Court for the Northern District of California, Case No. 14-72745, in the U.S. Court of Appeals for the Ninth Circuit.

UPDATE: The high-tech employee class action settlement has paid out! Checks were mailed the week of December 21, 2015. If you received a check, let us know in the comments. Congrats to everyone who got paid!