Thank you for sharing!

Your article was successfully shared with the contacts you provided.
Last year the U.S. Department of Justice said “game over” to several high tech companies engaged in anticompetitive hiring. Now the employees hurt by those practices want the companies to pay up. Siddharth Hariharan, a former software engineer at Lucasfilm Ltd., filed a class action lawsuit Wednesday against the production company and six alleged co-conspirators in California Superior Court. Hariharan claims Lucasfilm, Adobe Systems Inc., Apple Inc., Google Inc., Intel Corporation, Intuit Inc., and Pixar Animation Studios Inc. fixed the pay of their workers and entered into “no solicitation” agreements with each other. Hariharan alleges that the companies agreed not to actively recruit each other’s employees, agreed to notify each other before making an offer to another’s employee, and promised to cap initial pay packages offered to prospective employees. In an e-mail to CorpCounsel.com, a spokesperson for Lucasfilm said, “The claim is meritless. We have no further comment on the pending litigation.” A spokesperson for Intuit declined to comment. The remaining corporate defendants did not immediately respond to requests for comment. After investigating the defendants from 2009 through 2010, the U.S. Department of Justice found that the agreements between the high tech companies violated federal anti-trust laws. In a press release announcing settlement with six of the companies last year, Molly S. Boast, deputy assistant attorney general in the Justice Department’s antitrust division, said, “The agreements challenged here restrained competition for affected employees without any procompetitive justification and distorted the competitive process.” One of the main recruiting techniques used in the high tech sector is direct solicitation through “cold calling.” Justice said that type of competition, when not restrained, results in better career opportunities. The government claimed that beginning as early as 2005, some of the defendants agreed not to cold call workers from the other participating companies. Other defendants joined the arrangement over the years. After the Justice Department’s investigation into unfair play was made public, the companies voluntarily agreed to put an end to the anticompetitive agreements. But the settlement with the government did nothing to repair the harm already done to the employees. Hariharan is seeking restitution for lost compensation and treble damages for the anticompetitive employment practices. “Damages in a case like this are almost always market suppression,” says Herbert Hovenkamp, a law professor at the University of Iowa College of Law. “The damages would be the difference between the free market wage—the competitive wage—and the price-fixed wage.” “Competition in the labor markets results in better salaries, enhanced career opportunities for employees, and better products for consumers,” said Hariharan’s lawyer, Joseph Saveri of Lieff Cabraser Heimann & Bernstein, in a press release. “We estimate that because of reduced competition for their services, compensation for skilled employees at Adobe, Apple, Google, Intel, Intuit, Lucasfilm, and Pixar was reduced by 10 to 15 percent,” he said. “These companies owe their tremendous successes to the sacrifices and hard work of their employees, and must take responsibility for their misconduct.”

This content has been archived. It is available through our partners, LexisNexis® and Bloomberg Law.

To view this content, please continue to their sites.

Not a Lexis Advance® Subscriber?
Subscribe Now

Not a Bloomberg Law Subscriber?
Subscribe Now

Why am I seeing this?

LexisNexis® and Bloomberg Law are third party online distributors of the broad collection of current and archived versions of ALM's legal news publications. LexisNexis® and Bloomberg Law customers are able to access and use ALM's content, including content from the National Law Journal, The American Lawyer, Legaltech News, The New York Law Journal, and Corporate Counsel, as well as other sources of legal information.

For questions call 1-877-256-2472 or contact us at [email protected]

Reprints & Licensing
Mentioned in a Law.com story?

License our industry-leading legal content to extend your thought leadership and build your brand.


ALM Legal Publication Newsletters

Sign Up Today and Never Miss Another Story.

As part of your digital membership, you can sign up for an unlimited number of a wide range of complimentary newsletters. Visit your My Account page to make your selections. Get the timely legal news and critical analysis you cannot afford to miss. Tailored just for you. In your inbox. Every day.

Copyright © 2021 ALM Media Properties, LLC. All Rights Reserved.