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  1. #1
    WHT-BR Top Member
    Data de Ingresso
    Dec 2010

    [EN] Apple and Google’s wage-fixing cartel involved dozens more companies

    Although the DOJ ultimately decided to focus its attention on just Adobe, Apple, Google, Intel, Intuit, Lucasfilm and Pixar, the emails and memos clearly name dozens more companies which, at least as far as Google and Apple executives were concerned, formed part of their wage-fixing cartel.

    Back in January, I wrote about “The Techtopus” — an illegal agreement between seven tech giants, including Apple, Google, and Intel, to suppress wages for tens of thousands of tech employees. The agreement prompted a Department of Justice investigation, resulting in a settlement in which the companies agreed to curb their restricting hiring deals. The same companies were then hit with a civil suit by employees affected by the agreements.

    This week, as the final summary judgement for the resulting class action suit looms, and several of the companies mentioned scramble to settle out of court, Pando has obtained court documents which show shocking evidence of a much larger conspiracy, reaching far beyond Silicon Valley.

    Confidential internal Google and Apple memos, buried within piles of court dockets and reviewed by PandoDaily, clearly show that what began as a secret cartel agreement between Apple’s Steve Jobs and Google’s Eric Schmidt to illegally fix the labor market for hi-tech workers, expanded within a few years to include companies ranging from Dell, IBM, eBay and Microsoft, to Comcast, Clear Channel, Dreamworks, and London-based public relations behemoth WPP. All told, the combined workforces of the companies involved totals well over a million employees.

    According to multiple sources familiar with the case, several of these newly named companies were also subpoenaed by the DOJ for their investigation. A spokesperson for confirmed that in 2009-10 the company was investigated by the DOJ, and agreed to cooperate fully with that investigation. Other companies confirmed off the record that they too had been subpoenaed around the same time.

    A confidential Google memo titled “Special Agreement Hiring Policy,” dating from November 2006, divides the company’s wage-fixing agreements into two categories: “Do Not Cold Call” and “Sensitive Companies.” Below that, the Google memo offers a brief chronology and list of companies:

    The following companies have special agreements with Google and are part of the “Do Not Cold Call” list.
    The first entry marks the beginning of Google’s participation in the wage-suppression scheme:

    Effective March 6, 2005:

    • Genentech, Inc.
    • Intel Corporation
    • Apple Computer
    • Paypal, Inc.
    • Comcast Corporation
    Until now, neither Paypal (owned by eBay), Comcast nor Genentech have been publicly mentioned as part of the wage-suppression cartel. Nor have they been publicly named in criminal or civil actions relating to this particular case, although both the DOJ and the state of California are currently pursuing a separate but related antitrust suits against eBay.

    The “effective date” of Google’s first wage-fixing agreements, early March 2005, follows a few weeks after Steve Jobs threatened Google’s Sergey Brin to stop all recruiting at Apple: “if you hire a single one of these people,” Jobs emailed Brin, “that means war.”

    Jobs threatened Brin and Google on February 17, 2005; nine days later, Apple’s VP for Human Resources sent out an internal email to Apple recruiting,


    Please add Google to your “hands-off” list. We recently agreed not to recruit from one another so if you hear of any recruiting they are doing against us, please be sure to let me know.

    Please also be sure to honor our side of the deal.
    That was February 26; on March 6, Google’s identical non-solicitation agreement with Apple became “effective.”

    This timeline is important to establish because it demonstrates precisely what makes this scheme illegal: secret cross-agreements between two or more parties to fix wages in the labor market, at a time when tech engineer wages were soaring, threatening profits.

    This is just a tiny sample of the “overwhelming” evidence used by both the Justice Department’s antitrust division, and the District Court judge in San Jose, to debunk the company executives’ claims that each had coincidentally implemented identical non-solicitation policies at the same time, with the same companies, without knowing what the other side was doing.

    From that point on, the secret cartel expanded. Later that year, in September 2005, eBay CEO Meg Whitman called Schmidt complaining that Google’s recruiters were hurting profits and business at eBay. Schmidt emailed Google’s “Executive Management Committee”—the company’s top executives— summarizing Whitman’s, and “the valley”’s view that competing for workers by offering higher pay packages was “unfair”:

    Within weeks of Whitman’s call to Schmidt, eBay was placed on a Google list of “Sensitive” companies, for whom Google placed fewer restrictions on its recruiters except at the executive recruitment level. It was at this time that Google began to internally formalize its illegal wage-suppression pacts—and Schmidt was clearly worried about getting caught.

    In early October, 2005, Google’s Senior VP for Human Resources, Shona Brown, emailed Schmidt a draft list of companies on their “Do Not Call” and “Sensitive” lists, and the policy protocols.


    A year later, by the end of 2006, Google upgraded eBay to its “Do Not Cold Call” list, joining OpenTV, Nvidia Technologies, and Intuit along with the original five companies.

    Google’s “Sensitive” companies list (right) had shlmeanwhile grown to include AOL, AskJeeves, Clear Channel, Earthlink, IBM, Lycos, and NTL, a major British cable company known today as Virgin Media.

    Some of the companies Pando contacted for this article insisted, off the record, that they had not agreed to appear on Google or Apple’s lists, and that there were no reciprocal non-solicitation agreements. Indeed, that same line of defense was used by many of the defendants in the current case.

    Of course, it’s possible that Google, Apple or others simply added companies to their don’t recruit lists without coordinating with them first. That said, as we see from the Whitman and Jobs emails above, addition to the list was frequently prompted by an angry phone call or heated discussion.

    One example of this is Dell who, despite not being listed in the civil suit or DOJ investigation, was included on Google’s “don’t call” list after an angry email from Michael Dell himself.


    Incredible as it may seem, the Techtopus was just getting started. Between the end of 2006 and early 2008, its tentacles multiplied, reaching into the lives of workers across the globe and across more industries.

    A confidential Google document titled “Special Agreement Hiring Policy,” dated January 7, 2008, expanded the categories and definitions of the company’s secret deals. What started as a two-page memo in late 2006, had now grown to a list nine pages long.


    And Google isn’t the only company that kept a list. Buried in the court dockets is an email from Apple recruiting manager David Alvarez to fellow Apple recruiting manager Jonathan Geyer, dated July 9, 2009, containing a document titled “Hands Off (Do Not Call List).”

    That list includes the other six firms charged by the DOJ and originally named in the wage-suppression class action: Adobe, Google, Intel, Intuit, Pixar and Lucas. But the Apple “Do Not Call” list also includes an additional 21 companies not mentioned in the DOJ investigation or the class action suit. Among the companies that appear to have conspired with Apple to suppress their employees’ wages:

    Microsoft, AMD, Best Buy, Cingular, Foxconn, Nvidia, and a handful of distributors like Mac Zone, PC Connection and PC Mall. Some of the companies are on Apple’s “Do Not Call List” because, according to the memo, they share “common board members”: Intuit, JCrew, Nike, and Genentech, whose CEO at the time, Arthur Levinson, sat on Apple’s board of directors.


    For now, it’s enough to try to absorb what all of these cross-company, cross-industry secret labor-fixing agreements mean. Most labor stories about wage theft and corporate abuse tend to focus on low-wage earners and the most disadvantaged. Certainly it strains one’s sensibilities to compare an exploited low-wage worker in the fast food or retail industry to tech engineers and programmers, who are far better compensated, live more comfortably, and rarely worry about putting food in their children’s mouths.


    What’s more important is the political predicament that low-paid fast food workers share with well-paid hi-tech workers: the loss of power over their lives and their futures to the growing mass of concentrated power in Silicon Valley, whose tentacles are so strong now and so great, that hundreds of thousands of workers around the globe—public relations and cable company employees in the British Isles, programmers and tech engineers in Russia and China (according to other documents which I’ll write about soon)—have their lives controlled and their wages and opportunities stolen from them without ever knowing about it, all the while being bombarded with cultural cant about the wisdom of the free market, about the efficiency of free knowledge, about the need to take personal responsibility and to blame no one but yourself for everything that happens in your life and your career.
    Revealed: Apple and Google’s wage-fixing cartel involved dozens more companies, over one million employees | PandoDaily

  2. #2
    WHT-BR Top Member
    Data de Ingresso
    Dec 2010

    Facebook declined friend request

    New Details on Class Action Against Apple, Google, Intel and Adobe Show How Facebook Rejected Alleged Hiring Circle

    Some of tech's biggest names— Steve Jobs, Eric Schmidt, Sergey Brin, Bill Campbell —conferred and squabbled and made peace privately for years, documents in a current Silicon Valley antitrust case reveal. But they were unable to pull a new company into the club, the court documents show: Facebook declined their friend request.

    In a trial set to begin later next month, some Silicon Valley giants— Google Inc., Apple Inc., Intel Corp. and Adobe Systems Inc. —are accused in a class-action suit of colluding to suppress wages between 2005 and 2009, by agreeing not to poach each other's employees, among other things. The stakes behind the case are large, with some 64,000 employees seeking $3 billion in damages. But for now, a series of recently released documents are putting the spotlight on some potentially embarrassing details of an inner corporate circle.

    The case may not reach trial, observers say. Both sides said in court in March that mediations for a settlement were making progress. The Pixar and Lucasfilm units of Walt Disney Co., and Intuit Inc., also named in the initial suit, have already tentatively agreed to a $20 million settlement, according to a proposal from the companies that the judge is considering, court records show.

    If no settlement is reached, the $3 billion in damages could be tripled under antitrust rules. That would equate to $140,000 per worker, though the money wouldn't be divided evenly.

    In 2010 the six companies settled a civil suit by the Justice Department over similar allegations by agreeing not to restrict recruiting or hiring. The companies didn't admit wrongdoing in their settlement with the government. On the current case, Facebook Inc., Google, Apple, Adobe and Intel declined to comment.

    In today's red-hot tech market, these companies compete fiercely for talent. But documents made public in pretrial sparring in the private lawsuit have revealed how, in the 2000s, industry executives frequently consulted one another before recruiting workers or making strategic moves. Mr. Campbell, chairman of Intuit and a longtime adviser to Silicon Valley chief executives such as Mr. Jobs and Google's Mr. Schmidt, helped broker agreements among prominent tech companies not to recruit each other's employees, court documents show.

    The failed effort to bring Facebook on board, revealed in the recently released documents, which include emails and depositions filed with the court, provides a new window into the alleged conspiracy. In a March 28 ruling allowing the case to go to trial, U.S. District Judge Lucy Koh said Mr. Campbell "unsuccessfully sought to expand Google's anti-solicitation agreements to Facebook."

    Those agreements had often been handled with challenges and diplomacy at the top of the companies, the emails and depositions filed for this case and posted publicly by the court show. According to a February 2005 email Google co-founder Mr. Brin sent to Google executives, Mr. Jobs called him to complain that Google was recruiting Apple employees. Mr. Jobs told him, "If you hire a single one of these people, that means war," Mr. Brin wrote. Mr. Brin, in a deposition for the case, said Mr. Jobs was being "just kind of crazy."

    Google asked Mr. Campbell to make peace. In an email to Google executives, Mr. Campbell wrote that Mr. Jobs called "and is pissed that we are still recruiting his browser guy." The next day, Mr. Campbell replied to Mr. Jobs: "Eric (Schmidt) told me he got directly involved and firmly stopped all efforts to recruit anyone from Apple."

    In 2007, after similar complaints by Mr. Jobs, Google fired a recruiter who had contacted an Apple employee. Told of the firing in an email from Mr. Schmidt, Mr. Jobs forwarded the email to another Apple executive, and added a smiley face.

    An Intuit spokeswoman said Mr. Campbell couldn't comment on the case. She said Mr. Campbell "has played an important and productive role in building relationships," adding, "we believe all of Bill's actions have fully complied with the law."

    In August 2008, Mr. Campbell sought to address a new challenge, as upstart Facebook raided talent from its neighbors. "Who should contact Sheryl ( Sandberg ) or Mark ( Zuckerberg ) to get a cease-fire? We have to get a truce," Mr. Campbell wrote to Google executives in an email.

    Facebook balked. "I declined at that time to limit Facebook's recruitment or hiring of Google employees," Ms. Sandberg, Facebook's chief operating officer, said in a court statement provided for the suit.

    As Facebook boomed in 2007, Google took note. "The Facebook phenomenon creates a real retention problem, I now realize, not just because of FB's direct hiring, but the more insidious effect that everyone wants to start the next Facebook or get rich by having a popular fb app," Google's Mr. Brin wrote to Google executives in October 2007.

    Google continued to address its challenges from Facebook. Mr. Brin said in his deposition that he started receiving regular reports listing how many Google employees left for Facebook, and how many Facebook employees joined Google.

    Mr. Schmidt, then Google's CEO, said in his deposition that around 2008, "Facebook's management structure was being built out of executives coming out of Google." Most dramatically, Ms. Sandberg, then a Google vice president, left for Facebook in March 2008.

    In a June 2008 email, Google executive Shona Brown emailed colleagues about "really doubling down our efforts to recruit back [from Facebook]…to stem the tide and give us better negotiating position on a recruiting 'truce.' "

    Ultimately, Mr. Campbell sent his email seeking a truce with Facebook. Google surveyed employees, finding they, seeing colleagues leave for the potential of stock riches at Facebook, wanted more pay—in cash.

    In his deposition, Mr. Schmidt said of Facebook, "They were playing by a different set of rules."
    Última edição por 5ms; 21-04-2014 às 20:06.

  3. #3
    WHT-BR Top Member
    Data de Ingresso
    Dec 2010

    Tech Companies Agree to Settle Wage Suit

    Settlement Involves Apple, Google, Intel, Adobe

    The four big Silicon Valley technology companies agreed to settle a lawsuit in which 64,000 employees accused them of conspiring not to recruit each other's workers, depressing wages.

    The settlement was confirmed by Kelly M. Dermody, a lawyer for the plaintiffs at Lieff Cabraser Heimann & Bernstein LLP. "This is an excellent resolution of the case that will benefit class members," Ms. Dermody said in a statement.

    The employees had been seeking $3 billion in damages. Under antitrust rules, that could have been tripled to $9 billion.

    Thursday's settlement follows settlements reached last year with Lucasfilm Ltd., Pixar, and Intuit Inc. for a combined $20 million.

    The civil case followed a 2010 Justice Department case on the same matter.

    During pretrial proceedings in the class-action antitrust case, emails from top executives including former Apple CEO Steve Jobs and former Google CEO Eric Schmidt surfaced, showing the executives conferred on hiring plans.

    The case was set to begin May 27 before U.S. District Judge Lucy Koh in San Jose, Calif. Many had speculated that the big tech companies wouldn't want to go to trial, and have the evidence again play out in headlines, with their top executives discussed and questioned in court.

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