14 DAY TRIAL // The judge handling the class action in the Silicon Valley hiring deal scandal is having troubles deciding whether or not to approve the settlement proposed by the tech titans.
As it is already known, Apple, Google and two other tech companies involved in this scandal have agreed to settle with the plaintiffs back in April for $324.5 million (€238.4 million), a sum that is about ten times smaller than what the plaintiffs were originally going to ask for in damages. Given the nature of the case, it would have fallen under antitrust law and the sum could have tripled to $9 billion, making the settlement deal seem microscopic.
A few weeks after the settlement was announced, one of the plaintiffs wrote a letter to the judge, asking for the refusal of the deal since it wasn’t fair. Freelance Programmer Michael Devine couldn’t take any other path because he was involved in a class action that covered some 64,000 employees and he could’t exactly do anything about the issue since the settlement was agreed on by lawyers.
He felt that the deal wasn’t fair to the employees, who, after all was said and done, and lawyers were paid, would only receive a few thousand dollars each. Considering that they lost a lot more the instant the companies decided to agree not to poach each other’s employees, Devine believes that the settlement isn’t fair. Furthermore, these – Google, Apple, Intel and Adobe – are four of the biggest companies in Silicon Valley, which means that the $324.5 million are nothing more than pocket change.
District Judge Lucy Koh in San Jose, California is the one who has to make a decision about the issue, but on Thursday, she said that plaintiffs had leverage going into trial against the defendants, given the strength of the evidence in the case, so she had a hard time deciding whether or not to approve the settlement.
The evidence she mentions consists of a series of mails between Apple’s Steve Jobs and Google’s former CEO Eric Schmidt, as well as other Silicon Valley companies. In these, they discussed strategies to make sure they were not poaching employees from each other’s companies, making for an unbalanced working environment as the employee’s options were instantly limited.
“I just have concerns about whether this is really fair to the class,” Koh said.
While the judge was skeptical, the plaintiffs’ lawyer continued to claim that there are risks for his clients if the case goes forward since such lawsuits rarely go far.
At this point, however, it looks more and more that the only ones that have anything to win from settling are the four companies involved. Going forward with the case would expose even more of Silicon Valley’s inner workings and that’s not something they look forward to. In fact, the least the world knows, the better.