Google, Apple Accused of Holding Down Pay Across Tech Industry
NEW YORK (MainStreet) Nearly 60,000 Silicon Valley workers have banded together in a class action lawsuit accusing major technology firms including Google, Apple and Adobe of conspiring to hold down pay across the industry. Reuters is now reporting that Tuesday afternoon the 9th Circuit Court of Appeals gave final approval to that class certification.
The plaintiffs allege that the Silicon Valley tech giants have formed a cartel to "fix and suppress" wages across the industry by refusing to hire each others' employees. Workers claim that the case could ultimately be worth more than $9 billion in damages, a number made much higher by the court's Tuesday order allowing the case to proceed.
According to Reuters, much of the case revolves around e-mails between former Google CEO Eric Schmidt and the late Apple CEO Steve Jobs, messages in which the CEOs agree not to hire anyone employed by the other.
The claims are based on antitrust laws and allege illegal collusion to fix the hiring market and suppress wages. Class certification will allow the plaintiffs to proceed as one, joint lawsuit instead of breaking the case into the 60,000 claims of every worker. Courts allow this mechanism when each plaintiff alleges essentially the same conduct and type of harm, since trying one case is a much more efficient use of resources than trying essentially the same case 60,000 times.
Class certification also allows lawsuits to move forward when a defendant has caused enough aggregate harm, but no one plaintiff has lost enough to afford a lawsuit. Often in large class action lawsuits, the certification of the class decides whether or not defendants settle, as breaking the class can effectively end the suit. Failure to break the class, however, can create potentially massive exposure.
Plaintiffs won certification of their class in front of District Court Judge Lucy Koh, a decision which the defendants appealed. The higher court refused to allow this appeal, meaning the case will almost certainly proceed except in the extraordinary event that defendants successfully appeal to the Supreme Court.
Trial is set to begin in the 9th Circuit District Court on May 27 on In re: High-Tech Employee Antitrust Litigation, No. 13-80223. The Court of Appeals order refusing to allow the defendants' appeal is Hariharan et al v. Adobe Systems, Inc. et al, No. 11-02509.
Written for MainStreet by Eric Reed, a freelance journalist who writes frequently on the subjects of career and travel. You can read more of his work at his website www.wanderinglawyer.com.