Last week, a California Federal District Court Judge denied the request by seven California-based companies to dismiss claims against them alleging they had colluded with each other not to attempt to hire each other's employees.
The lawsuit claims that the companies conspired with one another to restrict salaries and job mobility by reducing competition for employees, thereby costing the employees millions of dollars, according to the five software engineers who originally brought the lawsuit.
Tech giants Apple Inc, Google Inc and Intel Corp - along with Intuit Inc, Pixar, Lucasfilm Ltd and Adobe Systems Inc - had asked the court to dismiss various federal and state claims alleged against them, including alleged violations of the Sherman Act, California's Cartwright Act and California's Unfair Competition Law (UCL). Ultimately, the court sided with the companies regarding the UCL claims, but refused to dismiss the other antitrust claims.
In her opinion, District Judge Lucy Koh stated the fact that many of the companies had "Do Not Cold Call" agreements among themselves supported the conclusion that they were negotiated at the top levels of the companies. She continued, "The fact that all six identical bilateral agreements were reached in secrecy among seven defendants in a span of two years suggests that these agreements resulted from collusion, and not from coincidence."
As this opinion illustrates, business litigation in California can be quite complex and difficult to navigate. Parties have to not only be able to address federal laws but state laws as well. Regardless of whether you are defending or presenting allegations of unfair business practices, an experienced business litigation attorney will be able to provide you the guidance you need.
Source: Reuters, "Apple, Google, Intel fail to dismiss staff-poaching lawsuit," Jonathan Stempel, April 19, 2012
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