This case has always been a bit shocking and weird – California-based tech employees sued big tech companies such as Apple, Google, Adobe, Intel and others and accused them in a class-action lawsuit of arranging an “interconnected web” of agreements between 2005 and 2009 not to hire each other’s workers with the illegal but secret plan having the effect of squelching any possibility of a destructive bidding war for talent amongst these employers.
You’ll recall that the plaintiffs were able to obtain in discovery troubling e-mails between Apple’s Steve Jobs and Google’s Eric Schmidt in which the latter apologized to the former for breaking the deal. There were also reportedly nasty e-mail patent litigation threats made by Mr. Jobs against Palm if Palm did not join the pact.
Intuit and Pixar and Lucasfilm settled early – but Apple, Google, Adobe and Intel failed to settle the civil case and an initial proposed settlement of $325 million for the approximately 60,000 or more covered employees in the class was rejected by Federal District Court Judge Koh in San Francisco. Judge Koh’s reported reasoning? Not enough money for the employees. The defendants then appealed Judge Koh’s rejection of the settlement to the federal Court of Appeals for the Ninth Circuit, arguing that the trial court’s rejection of the settlement on grounds that it was “not within the range of reasonableness” was a reversible legal error. Judge Koh apparently did the math and learned that the plaintiffs would receive approximately $4000 per worker – and that just didn’t work for her. She mandated that the case be prepared for trial in April of 2015. This was, by all accounts, an explicit and implicit judicial slap at the plaintiffs’ attorneys – essentially a message that the judge thought they were giving up too cheaply in a case where they had the defendants on their proverbial knees.
The new number that apparently works for Judge Koh? $415 million. But doesn’t this just give each plaintiff approximately another $1500 each? Yes, seems so. But reports are also indicating that the plaintiffs’ attorneys themselves are throwing an additional $24 million into the settlement pot (essentially giving up some of their 25% contingency) in order to generate the buy-in being reported from Judge Koh. There’s an upcoming hearing date for the acceptance of this new figure and arrangements and we’ll report back on that.