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On January 26, a class-action civil lawsuit involving some of the largest technology companies and Silicon Valley giants will be heard in San Jose, Calif. At issue is whether the companies came together and tried to get rid of competition for skilled labor.
The suit comes from a 2010 Department of Justice investigation. The named companies include Google (NASDAQ:GOOG), Apple (NASDAQ:AAPL), Pixar (NYSE:DIS), Lucasfilm, Adobe (NASDAQ:ADBE), Intel (NASDAQ:INTC) and Intuit (NASDAQ:INTU).
Until now, the investigation had been not been made public but on Friday this changed. After reviewing the DOJ investigation, TechCrunch noted that the plaintiff’s case alleged that the defendant companies tried to withhold employee compensation through “no poach” agreements.
In addition, the investigation disclosed that the defendants had “agreed not to poach employees from each other or give them offers if they voluntarily applied, and to notify the current employers of any employees trying to switch been.” The companies also agreed to neither have any bidding wars or put a limit on the potential numbers of employees negotiating for higher salaries.
And further damning evidence against the defendants is the investigation’s following language, there is “strong evidence that the companies knew about the other express agreements, patterned their own agreements off of them, and operated them concurrently with others to accomplish the same objective.”
Related News: German Court Rules For Apple Over Samsung in Countersuit.
Defendants vs Plaintiffs
The defendants have asked for the case to dismissed, based on the DOJ finding of “no overarching conspiracy” and that the bilateral agreements were separate. In September 2010, the DOJ settled with the seven companies; they said they would stop the illegal hiring practices. But the companies did not admit to admit to wrongdoing and the DOJ does have the right to check on them for compliance.
The plaintiffs are asking for damages for the salaried employees employed by any of the defendants during a four-year period in the late 2000s, according to Tech Crunch.This encompasses a lot workers who could see a payout should the defendants either lose the case or settle it.
Investing Insights: Apple Inc. First Quarter Earnings Sneak Peek.
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