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Tuesday, July 23, 2024 | Back issues
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Tech Giants Offer $415 Million to|Settle No-Poach Wage Class Action

SAN JOSE, Calif. (CN) - Adobe, Apple, Google and Intel upped their offer to $415 million to settle a sprawling case over high-tech wages, according to papers filed by the plaintiffs in the case on Thursday.

Software engineers, on behalf of an estimated class of 64,000, suedvthe tech giants - plus Intuit and Walt Disney subsidiaries LucasFilm and Pixar - in 2010, over illegal "no cold-call agreements" that restricted or eliminated competition for high-tech employees, which "disrupted the normal price-setting mechanism that apply in the labor setting."

The poaching ban, workers claimed, maintained internal salary structures at the companies from 2005 to 2009, and involved "gentleman's agreements" via CEO-to-CEO emails between the late Steve Jobs and other leading Silicon Valley CEOs.

Several lawsuits ensued, which were eventually consolidated into a single federal class action in San Jose, Calif.

In August 2014, U.S. District Judge Lucy Koh rejected workers' request for preliminary approval of a $325 million settlement. Koh found the offer too low, outside "the range of reasonableness."

Koh also ruled that although "ample evidence" showed an overarching conspiracy between the defendants, the proposed settlement was "proportionally lower" per class member than that of a separate $20 million settlement with Lucasfilm, Pixar and Intuit, in 2013.

The tech companies appealed Koh's rejection to the 9th Circuit, calling it "clear legal error."

But late Tuesday, word of a new settlement surfaced. That settlement, officially filed by the lead plaintiffs on Thursday, includes an all-cash, $415 million payout that is $90.5 million more than the first offer - and $35 million higher than Koh suggested when she rejected the first go-round.

If approved, the agreement would end three years of litigation that saw 80,000 different files change hands during discovery, according to the motion.

After attorney fees and service awards of $80,000 for each of the named plaintiffs, the remaining class members will receive about $6,400 each.

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