Steve Jobs called out in anti-poaching case

(Reuters)

The illegal anti-poaching conspiracy among top tech companies allegedly instigated by the late Apple, Inc. co-founder Steve Jobs could initially cost these conspirators a staggering $9 billion as payment to employees for lost wages.

Some 100,000 employees are involved in a class-action lawsuit that seeks a payment of about $90,000 per person for a total of $9 billion. The lawsuit will go to trial in San Jose in May.

Jobs was identified by the New York Times as "the driving force in a conspiracy to prevent competitors from poaching employees." The Times also asked "If Steve Jobs were alive today, should he be in jail?"

Apple and Google, Inc. have been identified by media reports as the leaders in a widespread anti-poaching conspiracy that effectively restricted their employees' salaries and curtailed their job opportunities. Adobe, Intel, Intuit, and Disney's Lucasfilm and Pixar units are among the many companies involved in the anti-poaching conspiracy.

Court documents from the lawsuit show the vast extent of the wage suppression cartel. It also revealed that the anti-employee conspiracy began with a secret cartel agreement between Jobs and Google CEO Eric Schmidt.

Tech website PandoDaily reported that confidential internal Google and Apple memos "clearly show that what began as a secret cartel agreement between Apple's Steve Jobs and Google's Eric Schmidt to illegally fix the labor market for hi-tech workers, expanded within a few years to include companies ranging from Dell, IBM, eBay and Microsoft, to Comcast, Clear Channel, Dreamworks, and London-based public relations behemoth WPP. All told, the combined workforces of the companies involved totals well over a million employees."

PandoDaily said the effective date of Google's first wage-fixing agreements was early March 2005. Previously, Jobs warned Google co-founder Sergey Brin to stop all recruiting at Apple and if Brin hired "a single one of these people, that means war."

The New York Times said Jobs "seems never to have read, or may have chosen to ignore, the first paragraph of the Sherman Antitrust Act."

The act says that every "conspiracy, in restraint of trade or commerce" is illegal. "Every person who shall make any contract or engage in any combination or conspiracy hereby declared to be illegal shall be deemed guilty of a felony, and, on conviction thereof, shall be punished by fine" or "by imprisonment not exceeding three years, or by both said punishments."

Jobs was a walking antitrust violation, claims Herbert Hovenkamp, an expert in antitrust law snd a professor at the University of Iowa College of Law.

Jobs was also the driving force behind an e-book price-fixing conspiracy along with major publishers. A federal judge last summer ruled that "Apple played a central role in facilitating and executing that conspiracy." The publishers all settled the case but Apple has appealed the conviction.

Jobs was also a lead player in an options backdating scandal eight years ago. At the time, thousands of options were backdated at both Apple and Pixar where Jobs was also CEO to increase the value of option grants to senior employees. Jobs received options on 7.5 million shares that were backdated to boost their value by over $20 million.

Apple later admitted that the minutes of the October board meeting where the grant was supposedly approved were falsified. It also said no such meeting occurred and that the options were actually granted in December. Jobs was never charged but five executives at other companies were jailed.

Apple, Google and other technology companies reached an agreement with the Department of Justice over the no-poaching practice in 2010. They agreed not to engage in any agreement or activity to reduce or prevent competition for employees. Last week, Apple and other technology companies settled a related class-action lawsuit and agreed to pay $324 million.

The Justice Department again chose not to file criminal charges against some of Silicon Valley's leading executives.

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

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