Silicon Valley workers may pursue collusion case as group: court

[January 15, 2014]  By Jonathan Stempel

(Reuters) — Roughly 60,000 Silicon Valley workers won clearance to pursue a lawsuit accusing Apple Inc, Google Inc and other companies of conspiring to drive down pay by not poaching each other's staff, after a federal appeals court refused to let the defendants appeal a class certification order.

The 9th U.S. Circuit Court of Appeals late on Tuesday let stand an order by U.S. District Judge Lucy Koh in San Jose, California to let the workers sue as a group, and pursue what the defendants said could exceed $9 billion of damages.

The case began in 2011 when five software engineers sued Apple, Google, Adobe Systems Inc, Intel Corp and others over an alleged "overarching conspiracy" to suppress pay by agreeing not to recruit or hire each other's employees.

These defendants were accused of violating the Sherman Act and Clayton Act antitrust laws by conspiring to eliminate competition for labor, depriving workers of job mobility and hundreds of millions of dollars in compensation.

Class certification can make it easier for plaintiffs to extract larger awards, at lower cost than if they sued individually. It could also add pressure on defendants to settle.

"We look forward to seeking justice for the class at trial," said Kelly Dermody, a partner at Lieff, Cabraser, Heimann & Bernstein, co-lead counsel for the class. She said a trial is set to begin on May 27.

A Google spokesman declined to comment. An Intel spokesman had no immediate comment. Adobe and Apple did not immediately respond to requests for comment.

In seeking the appeal, the companies had called Koh's order "manifestly erroneous".

They said that the claims were too disparate because they covered employees with 2,400 job titles at seven companies, and that the plaintiffs did not allege any impact on total hiring.

The U.S. Chamber of Commerce also asked the 9th Circuit to grant permission for the appeal.

Much of the case was built on emails between top officials, including the late Apple Chief Executive Steve Jobs and former Google Chief Executive Eric Schmidt, that the plaintiffs said reflected understandings not to raid each other's talent.

The 9th Circuit decision is Hariharan et al v. Adobe Systems Inc et al, 9th U.S. Circuit Court of Appeals, No. 13-80223. The lower-court case is In re: High-Tech Employee Antitrust Litigation, U.S. District Court, Northern District of California, No. 11-02509.

(Reporting by Jonathan Stempel in New York; editing by Kenneth Maxwell)

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