Big technology firms like Google, Intel, Apple and Adobe are used to being in the spotlight. Whenever any of these companies launches a new project, it’s all over the media. Moreover, these Silicon Valley giants get a lot of press about being benevolent employers that offer competitive salaries and a great benefits package.
This hasn’t stopped a group of 64,000 software engineers from filing a lawsuit against their employers. In the complaint, they allege that the major tech companies entered into an illegal agreement in which they each promised not to poach employees from the others. Members of the class say that this stifled their ability to earn and the incentive to seek employment elsewhere. What’s more, the complaint alleges that the companies profited from this agreement.
Several months ago, the plaintiffs and the defendants almost reached an agreement to settle for $324.5 million. Although lawyers for the class had approved of the offer, the judge assigned to the case, Lucy H. Koh, rejected it out of hand. She felt it wasn’t a sufficient amount and indicated disapproval that the counsel for the plaintiffs would settle for such a meager amount.
Now the employers are offering $415 million, and the plaintiffs have again accepted. The matter must still go before Judge Koh before it can be considered settled. If the case goes to trial, as it is scheduled to do in the spring of 2015, it’s possible that the damages awarded by a jury could reach to multiple billions.
It may be best for all involved to take the agreed upon settlement amount. Going to trial involves considerable risks for both sides, and is expensive regardless of which side ultimately prevails. Lawyers for the tech giants are wisely trying to avoid a trial that would expose their clients to negative publicity and may put them on the hook for a judgment that could reach up to several billion dollars.
Judge Koh will soon render a decision on the $415 million settlement. If she does not accept it, then the matter is likely to go to trial in a San Jose courtoom.
Sylvester, Oppenheim & Linde represents businesses and their owners in most types of litigation. If your business has a legal problem, contact Richard Oppenheim directly for a prompt, no charge initial consultation. You may use the contact form in the left column or call 818-461-8500.