Kelly Dermody, Lieff Cabraser Heimann & Bernstein partner (Jason Doiy / The Recorder)
SAN FRANCISCO — One of four named plaintiffs in the high-tech recruitment class action against Apple, Google, Adobe and Intel wants to derail a $324 million settlement reached last month, which he claims lets the Silicon Valley giants off far too easily.
In a May 11 letter to U.S. District Judge Lucy Koh, Michael Devine attacks the settlement as “grossly inadequate” and insufficient “to achieve justice for the class.” Devine, a former engineer for Adobe Systems Inc., complains he was not informed of the discussions leading to the tentative settlement until after an agreement had been reached.
Devine’s accusations put him at odds not only with plaintiffs lawyers at Lieff Cabraser Heimann & Bernstein and the Joseph Saveri Law Firm but also with other class representatives, who have already distanced themselves from his claims.
Plaintiffs attorneys agreed to settle with Google Inc., Apple Inc., Adobe and Intel Corp. late last month, in exchange for dropping claims the companies drove down wages by agreeing not to recruit each other’s employees. O’Melveny & Myers represents Apple; Jones Day is counsel to Adobe; Munger Tolles & Olson is defending Intel; and Keker & Van Nest and Mayer Brown jointly represent Google.
If approved, the settlement will allow defendants to avoid potentially billions in damages, a messy trial and a public rehashing of emails in which executives, including Apple’s Steve Jobs, discussed the so-called no-poach agreements and the need to keep them quiet.
“Why, with such uniquely compelling evidence in hand, would we short circuit this case?” Devine wrote to Koh, who is presiding over the case. “Please, Your Honor, allow us our day in court.”
But the three other named plaintiffs made it clear Monday that they are not behind Devine.
“I believe this is a good settlement that is in the best interest of the class,” Siddharth Hariharan, Mark Fichtner and Daniel Stover affirmed in separate declarations.
The three also insist they were kept apprised of negotiations. “My attorneys informed me of the proposed settlement with the defendants, and I agreed that the proposed settlement was fair, adequate, and reasonable,” their declarations state. “I authorized my attorneys to agree to the proposed settlement.”
Lieff Cabraser partner Kelly Dermody, colead counsel to the class, said attorney-client privilege prevented her from discussing how involved the named plaintiffs were in settlement negotiations. She also would not discuss the specific terms of the settlement, which will be submitted to the court by May 22.
“But I will say this is one of the largest employment settlements ever,” Dermody said, “and that it resulted from a mediation that was conducted by a very experienced retired federal judge who supervised the negotiations.”
Devine argues $324 million is a tiny fraction of the alleged damages, and an even smaller fraction of the defendants’ wealth. He compares the proposed settlement to punishing a shoplifter caught stealing a $400 iPad with a $40 fine, and allowing the thief to keep the iPad and walk away with no admission of wrongdoing.
“There’s no justice for the class in that,” Devine wrote, “nor is there any real deterrent to future wrongdoing.”
Devine did not respond to an emailed interview request. On his website, Tech Worker Justice, Devine says he is seeking new counsel to represent him as an objector.
Paul Bland, executive director of public-interest firm Public Justice in Washington, D.C., said it’s not that unusual for a named plaintiff to object to a settlement reached by his or her counsel. “The judge’s obligation is not so much to poll the main class representatives, as to determine what’s fair and reasonable,” he said.
Zelle Hofmann partner Francis Scarpulla, who specializes in antitrust suits but is not involved in this case, said he doesn’t remember a similar scenario emerging in any of his cases over the past 45 years. But, he said, plaintiffs representing a class of roughly 60,000 engineers and other skilled workers may be better equipped than most to involve themselves in the litigation.
“In this case you have very sophisticated named plaintiffs and you have very sophisticated class members,” Scarpulla said. “These people are well educated, they have good jobs, they are successful.”
But that doesn’t mean Devine’s objections will necessarily carry weight with Koh, Scarpulla said. If she deems the terms fair, reasonable and adequate, she should approve the settlement even if it is only a fraction of the $9 billion in treble damages sought by plaintiffs.
“You don’t settle for treble damages,” Scarpulla said. “You settle for single damages, and you settle for a percentage of single damages. … The fact that the defendants are wealthy companies isn’t the issue.”
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