Settlement over no-poaching pacts in Silicon Valley might be deemed too expensive - report

Following a class-action suit lodged by Silicon Valley employees against their employers, which include Apple Inc and Google Inc, it has been reported that the tech companies are currently working on a high-stakes negotiation to settle claims that they agreed to prohibit their workers from getting hired by rival firms. According to the lawsuit of the complainants, they have lost a collective $9 billion in wages due to the illegal hiring practices done by Apple, Google and the others. Andrew Ross Sorkin for The New York Times posed a question in a report about the amount the involved companies might shell out in settlement.

The companies, which also include Intel Corp and Adobe Systems Incorporated, has argued that the $9 billion that is being sought by the plaintiffs amounts to extortion. The complainants reportedly suggest that the facts for the case was embarrassing and damning that the Silicon Valley players might consider settling with the amount named in the lawsuit.

Sorkin said in his report that the evidence suggested that top executives of the defendants named in the lawsuit indicated that they indeed colluded with one another.

Former chief executive of Apple Steve Jobs at one time was quoted telling a Google executive, "If you hire a single one of these people that means war."

A note reportedly sent by the human resources department of Apple read, "Please add Google to your 'hands-off' list. We recently agreed not to recruit from one another so if you hear of any recruiting they are doing against us, please be sure to let me know."

These and several other emails documented the collusion of firms in Silicon Valley were discovered and revealed by Mark Ames of PandoDaily.

According to lawyers Sorkin surveyed on the subject, who refused to be identified, said that a blanket hiring ban was nonetheless anti-competitive. On the other hand, other lawyers, and even the executives of the involved firms themselves knew that so long as there is no reciprocal stated deal happening, they have the freedom to go about their hiring practices.

Should the case result to a trial next month in San Jose, Sorkin said that both sides might tap economic experts to determine the true cost actually lost by the plaintiffs due to the hiring practices in Silicon Valley. On the other hand, he said that at 100,000 plaintiffs, $90,000 is too much for every employee supposedly wronged due to the hiring collusion.

Tags

Google Inc, Apple Inc, Silicon Valley employee hiring agreements, Silicon Valley employee piracy

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