mannerisms

Ruminations on the electronics industry from David Manners, Senior Components Editor on Electronics Weekly.

No-Hire Conspiracy Settlement Challenged By Plaintiff

The Silicon Valley no-hire conspiracy case may not be over. One of the plaintiffs in the case, Michael Devine, has written to the judge asking her to reject the deal.

Devine tells the judge he was not informed of the proposed settlement before the plaintiff’s lawyers proposed it to the court.

The law case was brought against Google, Intel, Apple and Adobe asking for damages for their alleged conspiracy not to hire eachothers’ employees.

The lawyers for the plaintiffs settled the case for $324 million. The amount of damages that had been sought was $3 billion which could have been trebled under a punitive damages ruling.

Now Michael Devine, a programmer, has written to Judge Lucy Koh asking her to reject the deal.

 

Here is the letter:

May 11, 2014 The Honorable Lucy H. Koh United States District Court for the Northern District of California 280 South First Street, #4050, Courtroom 8 – 4 th Floor San Jose, CA 95113

Re: In re High-Tech Employee Antitrust Litigation 11-CV-2509-LHK (N.D. Cal.)

Your Honor,

I am a Class Representative in this case, and in that role I am writing to inform the Court that I feel the tentative settlement agreement reached between Defendants’ and Plaintiffs’ counsel, of which the Court was notified in Docket #900, and which was correctly reported in the press as being in the amount of $324 million, is grossly inadequate and fails to achieve justice for the Class. Therefore I respectfully ask that the Court reject it as unfair and unjust. The Class wants a chance at real justice. We want our day in court.

The evidence of the Defendants’ illegal conspiracy, and its intended impact, is very strong. In fact, the Defendants’ own actions reveal their valuation of the conspiracy. Just look at Google which, when Facebook rejected their illegal overture, felt compelled to raise annual compensation 10% company-wide to stem the flow of employees to Facebook. This settlement, in contrast, will amount to less than 1% of compensation for each class member over the duration of the illegal agreements. That’s one tenth of the experts’ estimates of damages and is lacking in any penalty. There’s no justice for the Class in that, nor is there any real deterrent to future wrongdoing. We want a chance at achieving real justice.

As an analogy, if a shoplifter is caught on video stealing a $400 iPad from the Apple Store, would a fair and just resolution be for the shoplifter to pay Apple $40, keep the iPad, and walk away with no record or admission of wrongdoing? Of course not, nor is such a resolution appropriate in our case. Perhaps, though, the prevalence of corporate crime is in part due to the absence of real justice for the victims in the courtroom? Why, with such uniquely compelling evidence in hand, would we short circuit this case? Please, Your Honor, allow us our day in court.

I also wish to inform the Court that I was not informed that the most recent round of mediation that lead to the tentative settlement was even taking place until the day after Plaintiffs’ and Defendants’ counsel had already reached an agreement. I should have been notified of this mediation so that I could substantively participate and fulfill my duties as Class Representative.

Nonetheless, after learning of this settlement, I informed Plaintiffs’ counsel in writing that I found it inadequate and that I intended, on behalf of the Class, to oppose it. Despite this, Plaintiffs’ counsel proceeded with informing the Court that a settlement agreement had been reached and thus litigation was halted. Is the role of Class Representative a mere formality absent substance? Does this case belong to the Plaintiffs’ counsel rather than the Class? No and no. This case belongs to the Class and we wish to proceed with the litigation.

The tentative settlement, if it stands, amounts to big profits for Plaintiffs’ counsel, insulation from real liability for the Defendants, and locks in a significant net loss for the Class. Therefore, on behalf of the Class, I respectfully ask that you reject this settlement so that we may have our day in court and a have real shot at justice.

Sincerely,

Michael Devine

Tags: Apple, Defendants, Michael Devine

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5 Comments

  1. david manners
    May 13, 2014 13:36

    The Judge makes a big difference, Silverman, and Judge Koh has shown she is no push-over for tech companies and as straight as a die. Regrettably, in recent years, there have been questions over the integrity of the judiciary in the US and UK, but in this case the Americans appear to have picked a gem.

  2. SilverMan
    May 13, 2014 13:28

    This is interesting. Normally justice can be bought – and no company admits wrong-doing. The costs are passed on to the chumps (sorry – “valued customers”).

    It would be remarkable if this case actually demonstrated the law making a difference. But, as the saying goes – the law is an a$$

  3. DontAgree
    May 13, 2014 06:43

    Normally I am strongly opposed to litigation, especially here in America it is very often abused as a sort of alternate lottery system where the one gets a ticket for free if some company somewhere makes the tiniest of mistakes.

    In this case however Michael Devine is entirely justified IMHO, although of course also here the only reason he is going for it is for his only personal benefit (hope for a big payday out of the lottery winnings).

    And no I am not part of the class and thus do not stand to benefit directly from the lawsuit. It is quite possible however that a deterrent against ‘no hire’ agreements will benefit me.

  4. david manners
    May 12, 2014 23:34

    As I understand it Mike, Devine has to get a substantial number of the Class i.e the 64,000 plaintiffs, to agree with him before the judge is obliged to refuse to accept the settlement. And he hasn’t got a significant number though he’s set up a web-site to bring them in. At this stage the settlement is only a proposal, not a done deal, though I expect the plaintiff’s lawyers have the right to act as the plaintiffs’ agents in proposing the settlement. Devine says he wasn’t told of the settlement before it was proposed to the court. If the lawyers have acted illegally then, of course, the judge will chuck out the proposed settlement out of hand. On the face of it the settlement is absurdly low – $5000 per plaintiff before the lawyers have taken their share which could be half – and the judge is a thoroughly good egg who will probably smell a rat – as I think do most people. The court considers it all again on June 19 – could be interesting. I think people are pretty fed up with the rapacity and dirty-dealing of the defendants and their ilk.

  5. Mike Bryant
    May 12, 2014 21:01

    “We want our day in court.”

    Just the sort of language that will really piss off any judge and so will ignore him. Judges expect an agreement to be reached by both sides and are not looking to have to sit through weeks of evidence.

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