Civil Suit Against Google, Apple and Others Over Employee-Poaching Ban Can Continue

MacRumors

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Apr 12, 2001
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A U.S. District Judge has ruled that an anti-trust case filed against a number of tech companies can continue, saying "they still have an antitrust claim" according to Bloomberg.



[Judge] Koh didn't take issue with the allegations about the agreements between individual companies, Joseph Saveri, a lawyer for the plaintiffs, said in an interview after the hearing. Instead, Koh has questions about "how it ties together," or claims of an over-arching conspiracy between all the companies, he said.
The case goes back more than 5 years, according to the lawsuit, which alleges that "no solicitation" agreements appeared in 2005 between Apple, Adobe, Google, Intel, Intuit, Lucasfilm, and Pixar. The agreements prevented companies from contacting employees at other companies who were party to the agreement, though employees were free to apply for jobs at other institutions.

The agreements were investigated in 2010 by the Justice Department. The claims were eventually settled, with the companies agreeing not to form no-solicitation agreements for five years.

The current lawsuit is a class-action civil suit brought by employees who said they were harmed by the anti-competitive actions of the defendant companies.

Article Link: Civil Suit Against Google, Apple and Others Over Employee-Poaching Ban Can Continue
 

Rodimus Prime

macrumors G4
Oct 9, 2006
10,136
4
Waaaaaahhhh! I can't break the contract that I signed!
Problem is the contract was illegal and not like you were given a choice. The boilerplate contracts have many things that are abuse of power.

If you want a job you have to sign that contract like that. So you have 2 choices. Be unemployed or sign a contract like that. There are no other choices.
 

Krazy Bill

macrumors 68030
Dec 21, 2011
2,985
3
Waaaaaahhhh! I can't break the contract that I signed!
Sure you can. But the other companies can't hire you. :)

Silly agreement. Anything that fosters cooperation between competitors means consumers lose. (And in this case, workers).
 

UFOGoldorak

macrumors member
Jun 25, 2007
54
0
Wow

which one of these doesn't belong children.. Apple, Adobe, Google, Intel, Intuit, Lucasfilm, and Pixar..

how does that happen??
 

Macbmw

macrumors newbie
Dec 3, 2011
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Wirelessly posted (Mozilla/5.0 (iPhone; CPU iPhone OS 5_0_1 like Mac OS X) AppleWebKit/534.46 (KHTML, like Gecko) Version/5.1 Mobile/9A405 Safari/7534.48.3)

Not too easy to be a high profile employee. Unemployment what is that?
 

JAT

macrumors 603
Dec 31, 2001
6,473
123
Mpls, MN
Problem is the contract was illegal and not like you were given a choice. The boilerplate contracts have many things that are abuse of power.

If you want a job you have to sign that contract like that. So you have 2 choices. Be unemployed or sign a contract like that. There are no other choices.
What in the world are you talking about?
 

Peace

macrumors Core
Apr 1, 2005
19,529
4,032
Space--The ONLY Frontier
I can understand to a degree why these companies do this sort of thing. If there were no agreement the tech world would have more technological espionage than it already has.

Google poaches an employee from Apple just to get information. Etc.

There has to be some kind of rule.
 

KnightWRX

macrumors Pentium
Jan 28, 2009
15,046
4
Quebec, Canada
I can understand to a degree why these companies do this sort of thing. If there were no agreement the tech world would have more technological espionage than it already has.

Google poaches an employee from Apple just to get information. Etc.

There has to be some kind of rule.
There is, it's called NDAs. These non-compete only hurt the workers.
 

Doctor Q

Administrator
Staff member
Sep 19, 2002
37,539
3,607
Los Angeles
If you want a job you have to sign that contract like that. So you have 2 choices. Be unemployed or sign a contract like that. There are no other choices.
Please explain. I thought this was an agreement among the companies involved, not between companies and their employees.
 

NoNothing

macrumors 6502
Aug 9, 2003
449
484
Problem is the contract was illegal and not like you were given a choice. The boilerplate contracts have many things that are abuse of power.

If you want a job you have to sign that contract like that. So you have 2 choices. Be unemployed or sign a contract like that. There are no other choices.
Not at all true. You can always reject specific parts of a contract. I have done that many times.
 

PeterQVenkman

macrumors 68020
Mar 4, 2005
2,023
0
Waaaaaahhhh! I can't break the contract that I signed!
Nope, you missed the entire meaning of it. It's about making it impossible for talented people to get hired elsewhere, or to keep them from making more money in their field of expertise as they become more talented and experienced.

A business lawyer, Barry Barnett, says it better than I could:

How can you hold down the cost of hiring the best talent?

In lots of businesses, the skill, knowledge, and creativity of workers make a crucial difference. Those traits matter most on the high end of the high-end. Think law, medicine, engineering, physics, computer science, rocket science, oenology, epistemology, and macrame. The high-end could hardly exist without these titans.

So what can you do to manage what you have to pay for their services? Can you agree with firms that compete with you to limit the talent's compensation? Can you exchange promises not to solicit one another's employees? Can you, in short, conspire to restrain trade?

Of course not.

That explains why Lucasfilm reached a deal with the Antitrust Division of the U.S. Department of Justice to end the company's pact with Pixar not to compete for digital animators. In a Complaint it filed as part of the arrangement with Lucasfilm, the Antitrust Division charged that Lucasfilm and Pixar "entered into an agreement not to cold call, not to make courteroffers under certain circumstances, and to provide notification when making employment offers to each other's employees."

Complaint #2: The Lucasfilm-Pixar pact, according to the press release, "eliminated important forms of competition to attract highly skilled employees and, overall, significantly diminished competition to the detriment of affected employees who were likely deprived of information and access to better job opportunities."

Pixar -- along with other high-tech companies including Intel and Apple -- reached a similar deal with the DOJ in September. Post here.

Note that an agreement with a direct competitor to limit rivalry over hiring employees constitues a per se violation of the Sherman Act. A per se violation doesn't require proof of monopoly power. So you may not want to beguile yourself with the notion that you comply with antitrust law so long as you don't dominate your market.
http://blawgletter.typepad.com/bbarnett/2010/12/animating-competition-doj-settles-claim-against-lucasfilm-for-noncompete-deal-with-pixar.html
 
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NoNothing

macrumors 6502
Aug 9, 2003
449
484
Krazy Bill gets it wrong.

Sure you can. But the other companies can't hire you. :)

Silly agreement. Anything that fosters cooperation between competitors means consumers lose. (And in this case, workers).
The other companies were fully capable of employing whomever they simply could not cold call (aka poach). For example. If you were an unhappy Apple employee, you could go to your Google friends and say, I want a job at Google instead of Apple and Google could hire you if you had the skill they were after. Since you were looking to move from Apple, the $$$ to get you to move is less.

However, the agreement made is such a Google manager could not say, "I remember so-and-so did some great work at Apple and cold call so-and-so to offer them a job doing a specific task. Since so-and-so might be happy at Apple, Google would have to offer so-and-so much more $$$ to leave and these companies wanted to avoid this type of wage inflation.

In this case, consumers were better served by keeping prices down. Employees were not better served by keeping their wages low.
 

NoNothing

macrumors 6502
Aug 9, 2003
449
484
NDA is just one piece of the contract.

it's posible, but if you reject an NDA, specially for a company were "privacy" is a top priority, you can just forget about getting a job there.
I never said "all parts" but you can reject some parts. I do it all the time typically with contractual "IP rights grab" clauses. Some states have provisions to protect individuals; most don't.

----------

I doubt it kept prices low. :-(
Given employee costs tend to be the most expensive part of these companies, keeping wages down keeps prices down. Wages go way up prices go way up.

What part of simple are you missing?
 

MisterMe

macrumors G4
Jul 17, 2002
10,650
28
USA
I can understand to a degree why these companies do this sort of thing. If there were no agreement the tech world would have more technological espionage than it already has.

Google poaches an employee from Apple just to get information. Etc.

There has to be some kind of rule.
You are achingly close, but not quite there. In the absence of a non-poaching agreement, non-disclosure clauses have been around for decades and still hold. This means that Google could theoretically lure away an Apple employee, but the Apple employee would be embargoed from sharing any confidential knowledge for a period of time. Just for good measure, say the embargo lasts for five years. Google hired the person for his skills, but not his knowledge.

Now here is where things get interesting. Let us say that Google brings a new product to market that is similar to an Apple product that Google's new hire worked on when he worked for Apple. Apple can bring a lawsuit against Google for theft of intellectual property. The burden of proof is on Apple without a doubt, but Google must defend the suit. Otherwise, Google will lose. Having a former Apple employee connected with the alleged stolen property makes Google's defense immeasurably more difficult.

The point is that these non-poaching agreements provide some legal protections for the companies that engage in them. I am about as far from a lawyer basher as you can get. However, the greatest beneficiaries to the elimination of non-poaching agreements will be the attorneys.

I am also not a corporate apologist. However, I agree with Macbmw. Unemployment is not a reasonable expectation of the work status of employees worth poaching. It sounds like the plaintiffs brought this lawsuit for the specific purpose of selling their knowledge to the highest bidder.

If this is the case, then they are in for a very big surprise if they win. Not only will their new employers be subject to civil judgments if they share their former employers' confidential information, but also they may be personally liable for both civil and criminal penalties.
 

Amazing Iceman

macrumors 68040
Nov 8, 2008
3,911
1,483
Florida, U.S.A.
I never said "all parts" but you can reject some parts. I do it all the time typically with contractual "IP rights grab" clauses. Some states have provisions to protect individuals; most don't.

----------

I never imply you did. Just one fact is true: There are lots of people looking for work nowadays that an employer has enough people to choose from. And they primarily want to hire the ones who are willing to follow company policies the most, without objections.
Wouldn't you do the same if you were the employer?
 

reech

macrumors newbie
Nov 11, 2008
21
0
I agree with having an NDA in your contract that means that if you go elsewhere , then spill your previous company's secrets that you will be fined, prosecuted, whatever.

However - the worker is an asset; they should be able to choose WHO they give their labour to.
 

Amazing Iceman

macrumors 68040
Nov 8, 2008
3,911
1,483
Florida, U.S.A.
I agree with having an NDA in your contract that means that if you go elsewhere , then spill your previous company's secrets that you will be fined, prosecuted, whatever.

However - the worker is an asset; they should be able to choose WHO they give their labour to.
yeah, and if your employee knows too much about company secrets, you better keep him; don't let him go easily, unless you prefer to kill him (but that's another subject and not a good way of do things).