Man in violation of privacy law

Breaking news and expert analysis on legal and compliance issues

[Back To Home][Back To Archives]

From Antitrust Law Daily, April 5, 2013

Employees of High-Tech Companies Denied Class Certification But Granted Leave to Amend

By Jeffrey May, J.D.

The federal district court in San Jose, California, has denied certification of proposed classes of former employees of high-tech companies in the San Francisco-Silicon Valley area of California to proceed with antitrust claims against their employers. The plaintiffs did not fulfill the requirements of Rule 23(b)(3) of the Federal Rules of Civil Procedure. However, the court granted leave to amend (In re High-Tech Employee Antitrust Litigation, April 4, 2013, Koh, L.).

The plaintiff software engineers alleged an overarching conspiracy among the defending tech companies to fix and suppress employee compensation and to restrict employee mobility. The suit named Adobe Systems Inc., Apple Inc., Google Inc., Intel Corp., Intuit Inc., Lucasfilm Ltd., and Pixar.

The proposed class action followed Department of Justice Antitrust Division civil actions against the firms, which were resolved by consent decrees in 2011 (2011-1 Trade Cases ¶77,477, 2011-1 Trade Cases ¶77,483). The plaintiffs contended that they brought the case as private attorneys general "to pick up where the DOJ left off, to seek damages for themselves and for the Class."

The plaintiffs sought to represent a nationwide class of 100,000 similarly situated individuals defined as follows:

All natural persons employed on a salaried basis in the United States by one or more of the following: (a) Apple from March 2005 through December 2009; (b) Adobe from May 2005 through December 2009; (c) Google from March 2005 through December 2009; (d) Intel from March 2005 through December 2009; (e) Intuit from June 2007 through December 2009; (f) Lucasfilm from January 2005 through December 2009; or (g) Pixar from January 2005 through December 2009. Excluded from the class are: retail employees; corporate officers, members of the boards of directors, and senior executives of all defendants.

Alternatively, the plaintiffs moved for certification of a class of approximately 50,000 salaried technical, creative, and research and development employees (Technical Class), defined as follows:

All natural persons who work in the technical, creative, and/or research and development fields that are employed on a salaried basis in the United States by one or more of the following: (a) Apple from March 2005 through December 2009; (b) Adobe from May 2005 through December 2009; (c) Google from March 2005 through December 2009; (d) Intel from March 2005 through December 2009; (e) Intuit from June 2007 through December 2009; (f) Lucasfilm from January 2005 through December 2009; or (g) Pixar from January 2005 through December 2009 [the "Technical Employee Class"]. The same exclusions apply to the technical class as to the all-employee class.

The defendants did not contest that the plaintiffs satisfied the elements of Rule 23(a): numerosity, commonality, typicality, and adequacy of representation. Instead, they argued that the plaintiffs' proposed classes did not satisfy Rule 23(b)(3)'s predominance requirement with respect to antitrust impact or damages.

The court concluded that there were common legal and factual issues regarding the alleged antitrust violation. It also was satisfied that the plaintiffs could show damages on a class-wide basis. However, the court was unconvinced that the plaintiffs could demonstrate a method for proving impact on a class-wide basis, at least at this time.

The court found that the plaintiffs' documentary evidence weighed heavily in favor of finding that common issues predominated over individual ones with respect to antitrust impact. Nevertheless, the court was concerned that the plaintiffs might not be able to show that all or nearly all class members were affected by the anti-solicitation agreements without additional documentary support or empirical analysis. The court took a class look at the plaintiffs' expert report which was submitted in support of the motion for class certification.

The court had "concerns about the capacity of Plaintiffs' evidence and proposed methodology to prove impact to the All Employee Class or the Technical Class." It was suggested that the proposed classes might include large numbers of people who were not necessarily harmed by the defendants' allegedly unlawful conduct.

The court noted, however, that "with the benefit of the discovery that has occurred since the hearing on this motion, Plaintiffs may be able to offer further proof to demonstrate how common evidence will be able to show class-wide impact to demonstrate why common issues predominate over individual ones."

The case is No. 11-CV-2509-LHK-PSG.

Attorneys: Anne Brackett Shaver (Lieff, Cabraser, Heimann & Bernstein LLP) for the plaintiffs. Anne M. Selin (Mayer Brown LLP) for Google Inc.; Christina Joanne Brown (O'Melveny & Myers) for Apple Inc.; Catherine Tara Zeng (Jones Day) for Intuit Inc.; Donn P. Pickett (Bingham McCutchen, LLP) for Intel Corp.; Craig Andrew Waldman (Jones Day) for Adobe Systems Inc.; Cody Shawn Harris (Keker and Van Nest LLP) for Lucasfilm Ltd.; Robert T. Haslam, III (Covington & Burling LLP) for Pixar Animation Studios.

Companies: Google Inc.; Apple Inc.; Intuit Inc.; Intel Corp.; Adobe Systems Inc.; Lucasfilm Ltd.; Pixar Animation Studios.

MainStory: TopStory Antitrust CaliforniaNews

Antitrust Law Daily

Introducing Wolters Kluwer Antitrust Law Daily — a daily reporting service created by attorneys, for attorneys — providing same-day coverage of breaking news, court decisions, legislation, and regulatory activity.


A complete daily report of the news that affects your world

  • View full summaries of federal and state court decisions.
  • Access full text of legislative and regulatory developments.
  • Customize your daily email by topic and/or jurisdiction.
  • Search archives for stories of interest.

Not just news — the right news

  • Get expert analysis written by subject matter specialists—created by attorneys for attorneys.
  • Track law firms and organizations in the headlines with our new “Who’s in the News” feature.
  • Promote your firm with our new reprint policy.

24/7 access for a 24/7 world

  • Forward information with special copyright permissions, encouraging collaboration between counsel and colleagues.
  • Save time with mobile apps for your BlackBerry, iPhone, iPad, Android, or Kindle.
  • Access all links from any mobile device without being prompted for user name and password.