
Technology Giants Settle Hiring Suit - nicholas73
http://www.nytimes.com/2014/04/25/technology/settlement-silicon-valley-antitrust-case.html?_r=0
======
jonathankoren
This is just absurd.

I honestly do not understand why the plaintiffs would settle this case. There
are multiple emails that proposing the conspiracy, executing the conspiracy,
expanding the conspiracy, and warnings to the ringleaders of the conspiracy
(i.e. Jobs, Schmidt, Whittman, Lucas, etc.) being told explicitly what they
were doing was illegal, and then actively taking actions to cover it up.
(Specifically I refer to Eric Schmidt's email in which he said regarding the
Apple-Google agreement, "I don't want to create a paper trail over which we
can be sued later".)

The only way you can prevent this, and other kinds of organized and large
scale fraud is through confiscation of revenue on a massive scale. To make the
companies _hurt_ and to _directly effect_ the officers of the companies.
Otherwise, these settlements are simply noise, and a chalked up as a cost of
doing business.

Here's some numbers to keep in mind, when the settlement is announced. Google
$16.86 BILLION in revenue Q4-2013 Apple $37.5 BILLION ($7B profit) Q4-2013
eBay $4.5 BILLION Q4-2013

Unless the settlement is in the tens-of-billions of dollars, it's nothing.
(Bonus points, if they settle, "while admitting no guilt.")

~~~
whoismua
_I honestly do not understand why the plaintiffs would settle this case._

Lawyers? Maybe they did the math and realized they could pocket $XXX million
to $1 Billion if they settled.

On the other hand, engineers might get a $10 Adwords coupon or a free song on
iTunes.

~~~
anxman
The attorneys are probably making a simple calculation:

a) Take a $1b settlement today, yielding $500m for attorneys.

b) Take a chance on a $5b judgement that is then challenged with years of
appeals and possibly reduced arbitrarily by a defendant-friendly judge down
the road.

The law firm probably is just happy to get the money.

~~~
whoismua
Bingo, that was my reasoning too. Bird in hand and all. Probably that's enough
money to make every lawyer in their firm a millionaire (not that it's divided
evenly) so why take the chance?

~~~
fsk
That's the problem with commission-based sales (like a real estate agent or a
headhunter). They say "My fee is a % of the sale, so I want the best price!",
but really it's in their best interests to close as soon as possible.

So, the lawyers could get their fee RIGHT NOW, or wait years til they get paid
and do lots of extra work. Clearly, the lawyers maximize their fee per hour
worked by settling now, rather than having years of trials and appeals.

~~~
DannyBee
Except that appeals work is significantly cheaper than a large lawsuit at the
district court, because it often focuses on legal error. They don't relitigate
the case.

Also, attorneys don't take appeals work on contingency, so you don't often see
as many appeals.

The only people what you are suggesting maximizes for is the plaintiffs.

You also act as if the lead plaintiffs in cases like you suggest are
blameless. The attorneys are not the ones agreeing to settle, and they
actually _can 't_ do things without the okay of their plaintiffs.

~~~
whoismua
_Except that appeals work is significantly cheaper than a large lawsuit at the
district court, because it often focuses on legal error. They don 't
relitigate the case._

You still ignored his main point, get the money now without delay and without
the possibility of appeals court striking it down or lowering the amount won--
if they win. Appeal after appeal can take a few years.

 _The attorneys are not the ones agreeing to settle, and they actually can 't
do things without the okay of their plaintiffs._ Can they "strongly suggest"
it to the plaintiffs?

~~~
DannyBee
"You still ignored his main point, get the money now without delay and without
the possibility of appeals court striking it down or lowering the amount won--
if they win. Appeal after appeal can take a few years."

Lawyers don't get money unless clients want the money and are willing to
settle. Period. The clients agree because _they_ don't want this risk. _They_
don't want to wait 7 years. It's easy to blame lawyers because they are
essentially enablers, but ...

Behind every crappy settlement is a crappy plaintiff. There may be a shady
lawyer somewhere, but laying the blame solely on the lawyer is silly.

For anyone who thinks the settlement is unfair, besides objecting, they _can
opt out_. If he really thinks it is so cheap, easy, and low risk to win a
lawsuit, he should do it.

"The attorneys are not the ones agreeing to settle, and they actually can't do
things without the okay of their plaintiffs. Can they "strongly suggest" it to
the plaintiffs? "

They can give their plaintiff candid advice, which is usually "This will take
3-7 years of your life, decide whether you'd rather spend that sitting in
depositions or with a small amount of money"

The vast majority of good class action attorneys are fine with either. They
can often win _much larger_ amounts than the settlement amounts to. No court
in the world would let them drop out of the lawsuit at this point (fun fact:
You can't withdraw in most cases unless the judge lets you, and the judge is
not going to let you just because you didn't settle)

I'm not going to claim there isn certainly a cottage industry of suing to
settle in certain areas. Trotting out _this_ lawsuit as an example of that
(when for example, we still don't even know the settlement amount) seems
silly.

------
sneak
This really makes me lose a lot of respect for Mr. Jobs.

How hard would it have been to say "anything Google offers you, we'll double
it, so don't fucking leave? We're busy changing the world here, and that would
be a pointless setback."

It's not like Apple is exactly cash-strapped, and it's not like he didn't know
the value of his teams ("means war" clearly speaks to that).

~~~
lutusp
> This really makes me lose a lot of respect for Mr. Jobs.

I tried to work with Jobs in the late 70s and early 80s, and I couldn't stand
him. After a brief spell I refused to work with Apple any more. Since then
I've been waiting for the world to catch up with my already low opinion. :)

Apropos, everyone should read the Isaacson biography. Regardless of how you
feel about the topic, it's a terrific book.

~~~
sneak
> Apropos, everyone should read the Isaacson biography. Regardless of how you
> feel about the topic, it's a terrific book.

Despite never having met or worked with the guy, I gotta side with Gruber's
take on this one: Isaacson totally missed the boat. He was granted
unprecedented (and now, unfortunately, impossible) access to a fiercely
interesting person's life, and either his lack of contextual understanding or
lack of domain knowledge led to a book that is, at best, underwhelming. His
questions, his analysis, it all seemed so pedestrian and boring.

Maybe the lack of hard questions or deep insights is why Jobs chose him in
particular to be granted such access, but I personally expected a whole fuck
of a lot more from something that had so much promise to begin with. I feel
like Mossberg or maybe even someone who doesn't write as their profession
(Ive? Kottke? Kawasaki?) might have done a vastly better job.

Maybe I just wish I'd had a chance to know the guy, deeply flawed character
and all, and no text will ultimately be sufficient - but Isaacson's effort
left me with so many more basic questions than it even began to attempt to
ask, much less answer.

And now, all that potential wisdom to be gleaned from this specific instance
falls into the realm of the unlearnable. Perhaps that was the plan. Who are we
to assume his legacy was any less meticulously crafted than anything else he
unleashed upon the world?

~~~
lutusp
> His questions, his analysis, it all seemed so pedestrian and boring.

I agree to some extent, but I also think this is a commonly heard complaint
about books about an insider in a field or art, written by an outsider --
other insiders inevitably see the shortcomings of a generalist's way of
describing a specialist.

I like the book precisely because it's the view of an outsider, who didn't
necessarily understand all the minutiae of his subject or the field, but to
some degree that circumstance can confer a kind of universality and
accessibility to the end result.

There's also the handicap of writing a biography of a living person who has
granted special access -- the writer must feel tremendous pressure to avoid
saying anything that might end his access. That's always lurking between the
lines when reading the biography of a person who was living when the book was
written -- it can't compare to the more classic tell-all, "Mommy Dearest" kind
of biographies of people no longer among the living. But the latter have their
own problems.

In the final analysis, good writing is defined by what you leave out, not what
you put in. I think Isaacson passes this test.

------
guimarin
Reuters is reporting the settlement to be about $324million. So an order of
magnitude less than speculated here.

[http://www.reuters.com/article/2014/04/24/us-apple-google-
la...](http://www.reuters.com/article/2014/04/24/us-apple-google-lawsuit-
exclusive-idUSBREA3N28Z20140424)

And just in case anyone is wondering that works out to: $3375 per employee
effected.

~~~
georgemcbay
And more importantly it works to: $totally worth it for the companies
involved.

324/4 = $81 million each (assuming they split it evenly, I have no idea how
that division works).

While each employee represented in this suit got the shaft, the bigger problem
(IMO) is that the punitive cost for the individual companies is small enough
(relative to their sizes and how much they likely saved by engaging in this
practice) that it alone is unlikely to change any future behavior.

------
defen
So I ask this only half-jokingly - at this point, what self-respecting
engineer would continue to work at Google, Apple, or these other firms? I
mean, these guys conspired to illegally suppress your wages, but you're
essentially a bunch of suckers who get paid off with a comfortable living,
"interesting work," and a bonus check for a couple thousand dollars and you're
happy. Meanwhile the people behind this are making literally billions of
dollars of profit.

~~~
fixermark
Salaried employment is made of suckers who can be compensated with less than
they might be worth because the alternative is a world where they would have
to fight for every scrip, scrap, and slice that they are owed.

I've been on both sides of that coin---I've worked for the startups and I've
worked for "the industry." Am I being "taken advantage of?" Am I being paid
less than I'm worth? Probably.

But I wouldn't trade the comfortable life of knowing my paycheck won't bounce
for the hardscrabble life of the startup cowboy any day of the week.

I'm curious what your recommendation is. Is there a third option? Are you
recommending people not work for the firms specifically involved in the
settlement? I guess I could always look into IBM...

~~~
7Figures2Commas
Most of the people who work at startups are salaried employees. So what's your
point?

As for your third option, it's called self-employment. It demands that you
fight for every scrip, scrap, and slice, but the reward is high: it's one of
the best and only ways to get paid what you're truly worth.

~~~
fixermark
It's not for me; I like externally-imposed structure and hate doing my own
accounting specifically enough to track all the taxes self-employment demands
I track. But it is a third option, and I tip my hat to those who find it
fulfilling.

------
abalone
I'm somewhere between the sentiments expressed here. I'm thankful there's a
strong incentive for top-notch law firms to pursue cases like this. I doubt
this would have happened otherwise. My concern is that a ~35% cut may motivate
the firms to settle for much less than would be meaningful for the victims.

The firm would gross a billion dollars on a $3B settlement, while the victims
would get an average of $30K. And considering how expensive a trial is, I can
see them settling for much less.

I don't know much about this field, but I wonder if it would make more sense
for the court to take vote among the class members rather than letting the
firm decide themselves. Or is it just up to the judge to decide if it's fair
and in the best interests of the class?

~~~
judk
The settlement was $324million for (64,000 class members and the attorney
fees).

~~~
abalone
So the figure leaked. Wow, that ain't sh*t.

------
rhizome
The fix is in. The class is represented by Lieff Cabraser Heimann & Bernstein,
which has a long history of getting low settlements in big cases. They are a
false-flag shill firm working for the benefit of themselves and the defendant
companies.

Like scofflaws Archer Daniels Midland, they are long-time sponsors of NPR, so
don't expect any hard-hitting reporting from the mainstream-left in the US.

~~~
dredmorbius
Citation required.

~~~
rhizome
It's simple math. Here's a case of theirs that was way under-settled:

[http://en.wikipedia.org/wiki/California_Uninsured_Patient_Ho...](http://en.wikipedia.org/wiki/California_Uninsured_Patient_Hospital_Pricing_Litigation)

A whopping $3K-tops/year per class member: [http://www.lieffcabraser.com/Case-
Center/Comdata.shtml](http://www.lieffcabraser.com/Case-Center/Comdata.shtml)

~~~
dredmorbius
That's 1) a single datapoint and 2) doesn't show how LCHB compares with other
law firms in class-action cases.

I'm not doubting, or believing, your assertion. I'm requesting something more
material than mere assertion.

I actually tend to share your skepticism of significant NPR sponsors -- too
many companies in need of whitewashing / greenwashing seem to end up in that
role, to the point it's tainted the brand. Now I think "Oh, I wonder what
_that_ company is trying to atone for" when I hear a credit (if I don't
already know, e.g., Walmart, Microsoft, Monsanto, Comcast, etc.).

~~~
rhizome
Frankly I couldn't care less about how other law firms do in class-actions. In
this issue we have LCHB and the settlement as leaked/rumored totally stinks
for the kind of activites, _admitted intentions_ , we have here. So it doesn't
matter how LCHB compares to others, what matters is that they aren't doing a
good enough job here.

I mean, come on, isn't it suspicious how quickly all of this was worked out?

~~~
dredmorbius
If you're going to argue a particular malfeasance or malpractice on LCHB's
part, then a comparison with industry norms is appropriate.

I consider your assertions unproven.

~~~
rhizome
I don't have to prove my opinion that the rumored settlement is too low
because it's a value judgement. I can also say without burden of proof that
non-prosecution of any criminal laws is less than ideal. I'm sure there's
someone out there who would say the settlement is too high, that since the
employees were free to start their own companies where they could make as much
as they thought they were worth, so no harm.

In other words, I'm not arguing malpractice, nor incompetence in the courtroom
sense, just that my interpretation of their history says that maybe they don't
have the class's best interests at heart. Again, opinion.

If you have some sense that whatever they came up with was the best result
possible, I'd really love to hear the rationale there, because I don't think
one exists.

------
joshavant
Could anyone explain how the terms of this are able to go undisclosed when
this is a class action suit, and the plaintiffs are the public at large?

~~~
thrownaway2424
How did you form the belief that the public at large are the plaintiff class?
I believe it's comprised of people who actually worked for the named companies
between specific dates.

~~~
gopher1
Although I believe he meant "public" as in, people who were affected but not
directly filing the lawsuits. So, as you say, people who worked for or were
affiliated with the affected companies.

However, you can make the argument that this affected the entire North
American tech labor market, in which case it truly would be the tech public at
large.

Perhaps that's why they're so keen to settle.

------
fsk
Suppose the settlement was $6B and 60k members are in the class. That's $100k
per worker. However, the lawyers usually get 1/3, so $2B for the lawyers and
$67k per worker.

That's the offensive part about class action lawsuits like this. The lawyers
MAKE A FORTUNE. The class victims get a decent check, but nothing great, and
probably less than they lost due to the crime.

~~~
harryh
The lawyers also do all the work and take on all the risk.

~~~
Stratoscope
> The lawyers also do all the work and take on all the risk.

Except for being the ones who were actually _harmed_ in the matter.

Edit: Despite my snarky reply, I'm with toomuchtodo - I upvoted your post even
if I felt annoyed by it at first, because you make a very good and valid point
and it gave me food for thought.

Why was I annoyed by your post, then? Probably my Borland check.

It must have been about 20 years ago, but there was some class action suit on
Borland stock. I was in the class and from the numbers they sent out, it
looked like I might actually get some real money out of it, at least a
thousand bucks or so.

Then my check came. $17.

I pored through the documents to see what had gone wrong, and I found it:
there was a limited settlement fund, I think around $12 million, only a tiny
fraction of the hundreds of millions that the original class action
notification had talked about.

Out of the $12 million settlement fund, the lawyers got $7.5 million.

I'm going to quit software development and get into _that_ business.

~~~
tomp
> Except for being the ones who were actually harmed in the matter.

What did the engineers risk with this lawsuit? Nothing. What did the law firm
risk? Getting paid peanuts for hundreds of hours they spend on the case if
they lose.

~~~
conanbatt
The engineers lose the capacity to get compensation for what was done to them.
If they lose the lawsuit by bad lawyers, they wont get a penny.

The fact that there is risk upfront doesnt make any payoff reasonable.
Otherwise, you wouldnt find layers keeping 99% abusive.

The biggest question for me is, with so much money ats take, why dont several
lawfirms compete to each other for a lower cut? at 2 billion profits potential
profit, why dont they offer a lower comission to get the client?

~~~
harryh
Because the client is generally more concerned with getting a favorable
outcome in the lawsuit than on the fee and a lawyer willing to charge a
smaller fee is a signal that they will be less likely to achieve a favorable
outcome.

It's the same reason that you don't see a lot of price competition for real
estate brokers (though this is changing some).

I'm not saying this is a great reason, but I do thin it is the reason.

------
jjwiseman
I like to imagine the cognitive dissonance this is causing in Google employees
("Google is good" / "Those emails are damning evidence of a conspiracy to
break the law") leading to explosive outbursts and aggressive responses on
eng-misc.

~~~
oh_sigh
eng-misc is the area for the most cynical of employees. you really don't know
anything if you expect them to be experiencing cognitive dissonance as you
stated.

------
bsder
And $6 billion split between all the companies involved is a rounding error.

Make the fine $6 trillion and now you're talking something that will likely
deter this behavior.

$100K per worker is irrelevant compared to the amount of money the companies
gained by holding down salaries even 5% after compounding.

It's not like everybody's salary jumps up the lost amount after this.

~~~
tptacek
By putting the companies out of business, and all their employees out of work?

~~~
bsder
So, illegal behavior is fine as long as it provides jobs? You might want to
think about your statement a little harder.

Yes, the penalty should be high enough that the company goes bankrupt if they
lose 2 or 3 of these kinds of cases.

------
skkbits
Honest question: Who gets the settlement ? Anyone who worked for defendants
between certain years ? How do they determine 60K employees ? What if someone
has left the industry altogether or in an unfortunate case, is no more ? Can
someone shed light on this area ?

------
dredmorbius
Pity. I'd have liked to see the disclosures forced by going to trial, as well
as a far more substantial penalty. Is there any indication if earlier DoJ
action prevents a future investigation and penalty for this?

------
tfthrowaway
I worked for one of these firms during the time period mentioned (as I suspect
many other readers here did). Does that automatically make me one of the class
members? How do I find out more?

~~~
xorgar831
[https://www.hightechemployeelawsuit.com/](https://www.hightechemployeelawsuit.com/)

Though I think the deadline has passed... you had to register to be part of
it.

Update: oh, I take that back, you have until 4/26/2014 it says.

------
abalone
New report with the $amount ($324M):
[https://news.ycombinator.com/item?id=7645182](https://news.ycombinator.com/item?id=7645182)

------
briantakita
The moral of the story...

If you have a business, it is almost always to your advantage to break the law
in pursuit of profit. Even lawsuits, rare as they are, are cheaper than
following the law.

~~~
whoismua
True, this will only change when Mr CEO or HR person gets jail time.

~~~
briantakita
Since the companies are considered people, they should also get jail time.
That should motivate shareholders to insist on scrupulous behavior.

~~~
politician
Corporate jail time (i.e. barring a company from operating in the marketplace)
is equivalent to a death sentence for most companies. Nevertheless, I'd love
to hear some ideas about what else "jail time" for a corporation might mean.

~~~
aniro
The core of the Citizens United decision was that becoming a member of a group
(ie: Corporation) did not abrogate individual rights. The implication is that
groups of people have the exact same rights as individuals.

I think there needs to be a corollary in terms of responsibility.

Of course, the entire raison d'etre of modern corporations is to indemnify the
members against responsibility for the actions of the group.

------
Bahamut
Can anyone answer this question - for what appears to be a rockstar case, is
there any reason why someone would opt for a class action suit and not sue on
their own?

------
rwmj
How come no one goes to prison? (Genuine question: does US monopoly law not
allow that outcome?)

~~~
sethhochberg
A lawsuit case like this is a civil matter - judgements / settlements are made
based on some violation of a legal agreement between two parties. Violation of
that legal agreement may or may not be a criminal issue.

For someone to go to prison, a criminal case would be needed, requiring
criminal acts - not just violations of a legal agreement - and government
prosecutor willing to bring charges against the parties allegedly responsible.

It seems there were (probably) criminal acts here, but as of yet we've not
seen a prosecutor go after the case. These kind of things can be further
complicated in the US because of the different standards of proof required for
each case type. In a criminal case, the state must be able to prove "beyond
any doubt" that the defendant is indeed guilty. Civil cases have a much less
ironclad standard for guilt/responsibility, and can often be easier to "win"
as a result.

Its certainly possible that government prosecutors are aware of the issue, and
aware of the civil settlement, but don't believe they could prepare a
compelling enough case based on the evidence available to win a criminal trial
against undoubtedly well-legally-represented executives.

~~~
bagels
The emails seem like fairly good evidence for criminal misconduct, but I am
not a court nor a lawyer.

~~~
DannyBee
Errr, what criminal law do you believe it violates?

~~~
mullingitover
Obstruction of justice? The emails explicitly state that the planning should
be taken offline, presumably to thwart any future investigation.

~~~
DannyBee
Obstruction of justice (which is not actually a single thing, really)
generally deals with doing this when there is an investigation in progress.

See
[http://www.fas.org/sgp/crs/misc/RL34303.pdf](http://www.fas.org/sgp/crs/misc/RL34303.pdf)
for more details of the federal statutes.

Anticipatory obstruction is kind of a possible thing under SOX, but otherwise,
no.

