Poaching lawsuit against tech companies will proceed – judge

A civil lawsuit against several large tech companies over anti-poaching agreements will move forward, but may be broken up into multiple potential class actions, a U.S. judge said on Thursday.

In a San Jose federal court hearing, U.S. District Judge Lucy Koh said overlapping relationships between the companies, including Apple and Google, made it "hard to believe" the industry's arguments that they should not have to face the antitrust lawsuit.

The proposed class action lawsuit brought by five software engineers against Apple Inc and other tech companies including Google Inc and Intel Corp accuses them of conspiring to keep employee compensation low by eliminating competition for skilled labor.

Plaintiff attorney Joseph Saveri said the damages potentially could run into hundreds of millions of dollars.

In 2010, Google, Apple, Adobe Systems, Intel, Intuit Inc and Walt Disney Co's Pixar unit agreed to a settlement of a U.S. Justice Department probe that bars them from agreeing to refrain from poaching each other's employees.

In announcing the settlement, the Justice Department confirmed the existence of agreements between the companies to avoid cold-calling each other's workers.

Among the revelations stemming from the civil litigation is a 2007 note from Palm's chief executive to Apple's Steve Jobs, saying that an anti-poaching agreement would be "likely illegal".

In court on Thursday, Apple attorney George Riley said the civil case should be quickly dismissed. Most of the anti-poaching agreements are bilateral attempts to protect collaboration between companies, but not an overarching conspiracy.

Yet plaintiff attorney Saveri said that the companies modeled their agreements after each other. At one point, Judge Koh said some of the companies did appear to know more about what was happening beyond their own deals.

"On the Apple side of the equation, there probably was more knowledge that other companies were having these bilateral agreements," Koh said.

Koh said that separate class actions over each agreement may make sense. Either way, the case will not be quickly dismissed, she said, and scheduled a further hearing for April.

The case in U.S. District Court, Northern District of California is In Re: High-Tech Employee Antitrust Litigation, 11-cv-2509.

(Published by Reuters - January 27, 2012)