Judge Lucy Koh today rejected the settlement deal that Apple, Google, Intel, and Adobe had reached with tech workers over a lawsuit involving anti-poaching agreements, reports CNBC.
According to court documents, Koh believes the total settlement "falls below the range of reasonableness," compared to the $20 million settlement that Pixar, Lucasfilm, and Intuit reached with tech employees in 2013. Proportionally, based on that settlement, Apple and the other tech companies should have to pay out at least $380 million.
The Court finds the total settlement amount falls below the range of reasonableness. The Court is concerned that Class members recover less on a proportional basis from the instant settlement with the Remaining Defendants than from the Settled Defendants a year ago, despite the fact that the case has progressed consistently in the Class’s favor since then. Counsel’s sole explanation for this reduced figure is that there are weaknesses in Plaintiff’s case such that the Class faces a substantial risk of non-recovery. However, that risk existed and was even greater when Plaintiffs settled with the Settled Defendants a year ago, when class certification had been denied. [...]
Using the Settled Defendants’ settlements as a yardstick, the appropriate benchmark settlement for the Remaining Defendants would be at least $380 million, more than $50 million greater than what the instant settlement provides.
Tech workers initially levied the class action anti-poaching lawsuit against the companies in 2011, accusing them of creating no-hire agreements and conspiring not to poach employees from one another in an effort to keep salaries lower.
No-solicitation agreements revealed during the lawsuit dated back to 2005, involving Apple, Google, Intel, Adobe, Intuit, Lucasfilm, and Pixar, among others. The agreements prevented company recruiters from contacting employees placed on specific no-contact lists.
The United States Department of Justice stepped in back in 2010, ordering the companies to stop entering anti-poaching agreements, but the class-action civil lawsuit brought against the companies by 64,000 employees will remain open until a suitable settlement can be reached. The suit originally asked for $3 billion in damages, a significantly higher number than the 324 million agreed upon in April.
