On March 7, 2007, the late Steve Jobs sent an email to Eric Schmidt, who was at the time Google’s CEO and still a member of Apple’s board of directors: “Eric, I would be very pleased if your recruiting department would stop doing this. Thanks, Steve.”1)
“This” was a cold call from a Google recruiter to an Apple engineer trying to convince the engineer to move to Google. The next day, Schmidt sent the following email to Google’s HR department: “I believe we have a policy of no recruiting from Apple and this is a direct inbound request. Can you get this stopped and let me know why this is happening? I will need to send a response back to Apple quickly so please let me know as soon as you can. Thanks, Eric.” Shortly thereafter the recruiter was fired.
This exchange between two of the most powerful people in the tech world—and definitely in Silicon Valley—was one of the pieces of evidence in a 2010 antitrust lawsuit by the DOJ against Adobe, Apple, Google, Intel, Intuit, Lucasfilm, and Pixar (US v. Adobe Systems Inc., et al.). The DOJ claimed that the defendants entered into an illegal “no cold call” agreement, thus limiting their respective employees’ career options.
The DOJ used harsh words in its complaint: “Defendants’ concerted behavior both reduced their ability to compete for employees and disrupted the normal price-setting mechanisms that apply in the labor setting. These no cold call agreements are facially anticompetitive because they eliminated a significant form of competition to attract high tech employees, and, overall, substantially diminished competition to the detriment of the affected employees who were likely deprived of competitively important information and access to better job opportunities.”2)
The DOJ and the defendant companies proposed a settlement on the same day that the suit was filed. Although the DOJ was not timid in the way it described the defendants’ conduct—and although it was definitely a high-profile case that was not just well-covered by the press but also followed closely by corporate executives—the outcome was only moderately impactful: in the settlement that was approved by the court, the companies agreed to broader limitations on the recruitment practices for a period of five years. The settlement included no compensation for the employees. However, a class action resulted in Adobe, Apple, Google, and Intel paying $415 million, Pixar and Lucasfilm paying $9 million, and Intuit paying $11 million.
“This” was a cold call from a Google recruiter to an Apple engineer trying to convince the engineer to move to Google. The next day, Schmidt sent the following email to Google’s HR department: “I believe we have a policy of no recruiting from Apple and this is a direct inbound request. Can you get this stopped and let me know why this is happening? I will need to send a response back to Apple quickly so please let me know as soon as you can. Thanks, Eric.” Shortly thereafter the recruiter was fired.
This exchange between two of the most powerful people in the tech world—and definitely in Silicon Valley—was one of the pieces of evidence in a 2010 antitrust lawsuit by the DOJ against Adobe, Apple, Google, Intel, Intuit, Lucasfilm, and Pixar (US v. Adobe Systems Inc., et al.). The DOJ claimed that the defendants entered into an illegal “no cold call” agreement, thus limiting their respective employees’ career options.
The DOJ used harsh words in its complaint: “Defendants’ concerted behavior both reduced their ability to compete for employees and disrupted the normal price-setting mechanisms that apply in the labor setting. These no cold call agreements are facially anticompetitive because they eliminated a significant form of competition to attract high tech employees, and, overall, substantially diminished competition to the detriment of the affected employees who were likely deprived of competitively important information and access to better job opportunities.”2)
The DOJ and the defendant companies proposed a settlement on the same day that the suit was filed. Although the DOJ was not timid in the way it described the defendants’ conduct—and although it was definitely a high-profile case that was not just well-covered by the press but also followed closely by corporate executives—the outcome was only moderately impactful: in the settlement that was approved by the court, the companies agreed to broader limitations on the recruitment practices for a period of five years. The settlement included no compensation for the employees. However, a class action resulted in Adobe, Apple, Google, and Intel paying $415 million, Pixar and Lucasfilm paying $9 million, and Intuit paying $11 million.
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