Apple, Google, and the e-mail trail in the no-poaching case

A paper trail of e-mails published by The Verge from court filings suggest that technology firms agreed not to recruit employees from each other.

Lieff Cabraser Heimann and Bernstein

Apple, Google, Intel, Adobe, and other companies had agreements in place during the mid-2000s not to steal employees from each other and other technology players, court documents suggest.

A series of e-mails posted today by The Verge point to a paper trail of apparent non-poaching agreements among a variety of companies.

The revelation follows a civil lawsuit filed in 2011 by five workers against Apple, Google, and others alleging that the companies purposely tried to keep down wages through non-poaching agreements.

The civil suit is being weighed by Judge Lucy Koh to determine if it can move forward as a class action suit, says Reuters. If so, that could pave the way for a bigger settlement. Attorneys for the plaintiffs claim damages could reach hundreds of millions of dollars. But Koh said that analysis had "holes," Reuters added.

In one case made public yesterday, then-Palm CEO Edward Colligan said in a sworn statement that he received a call from Apple CEO Steve Jobs in 2007 suggesting a non-poaching agreement between the two companies. After pointing out that such an arrangement was "likely illegal," Colligan said Jobs suggested that if Palm didn't agree, Palm could face patent infringement lawsuits from Apple.

But the reported exchange between Jobs and Colligan seems to be the tip of the iceberg.

In one February 2006 e-mail displayed by The Verge, Jobs is shown to be asking Google CEO Eric Schmidt to stop recruiting people from Apple's iPod group: "Eric, I am told that Googles new cell phone software group is relentlessly recruiting in our iPod group. If this is indeed true, can you put a stop to it? Thanks, Steve."

In another message in the court documents, a senior staffing strategist at Google told Schmidt that a recruiter who tried to hire an Apple employee was to be fired . Schmidt's response? "I would prefer that Omid do it verbally since I don't want to create a paper trail over which we can be sued later? Not sure about this."

Other e-mails traveled throughout Silicon Valley. A message from Intel CEO Paul Otellini points to an agreement with Google but cautions that "we have nothing signed. We have a handshake 'no-recruit' between eric and myself. I would not like this broadly known."

Also in the court documents, a memo from Intel says that people from Pixar cannot be recruited, adding that if someone from Pixar applies for a job, the CEO of Pixar needs to be contacted for approval.

Some companies actually maintained lists of firms that were off limits for talent acquisition.

A document from Adobe allegedly shows the company warning staffers not to recruit workers from Apple, Bell Canada, EMC, SAP, and others. An Apple document placed Microsoft, Google, Intel, Pixar, and a host of others on the do-not-call list. A Google document cautioned against contacting potential hires from Intel, Apple, PayPal, Comcast, and Genentech, saying that Google has "special agreements" with these companies.

In 2010, Apple, Adobe, Google, Intel, Intuit, and Pixar settled with the Justice Department by promising to end non-poaching agreements.

Responding to a request for comment, a Google representative told CNET that the company has "always actively and aggressively recruited top talent."

A spokesman for Intel sent CNET the following statement:

This case followed a consent decree signed by Intel and five other companies with the U.S. Department of Justice in September of 2010. We admitted no wrong doing in signing that agreement. This suit was filed in May of 2011. So the reports [relate] to the ongoing case and don't reflect a new matter. In this particular case, Intel does not believe its actions violated the law nor does the company agree with the allegations. The company settled the DOJ matter because it believes it would not harm the company or its ability to do business. We have not commented on the documents or other developments in the case because it is our practice to refrain from litigating matters outside of the courts.

CNET also contacted Apple and will update the story if the company responds.

Updated January 24 at 9:30 a.m. PT with response from Intel.

 

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