According to leaked emails, Apple's late co-founder Steve Jobs and Google utilized illegal no-hire agreements.
According to a court filing made public on Tuesday, Jobs threatened to file a patent lawsuit against Palm if its former chief executive, Edward Colligan, didn’t agree a deal with Apple that would result in neither company poaching each other's workers.
The filing is a civil lawsuit from five technology workers against Apple, Google and others that alleges the firms discussed methods to decrease wages. A sworn statement from Colligan reads:
"In 2007, I received a call from Steve Jobs, the Chief Executive Officer of Apple. In the months before the call, several employees had moved between the two companies. On the call, Mr. Jobs expressed concern about employees being hired away from Apple by Palm. As a solution, Mr. Jobs proposed an arrangement between Palm and Apple by which neither company would hire the other's employees, including high tech employees. Mr. Jobs also suggested that if Palm did not agree to such an arrangement, Palm could face lawsuits alleging infringements of Apple's many patents."
Jobs said the following when stating what the legal consequences could have been should Colligan not have agreed: "I’m sure you realize the asymmetry in the financial resources of our respective companies when you say: ‘We will both end up paying a lot of lawyers a lot of money.’" He also told Colligan:
"Just for the record, when Siemens sold their handset business to BenQ they didn't sell them their essential patents but rather just gave them a license. The patents they did sell to BenQ are not that great. We looked at them ourselves when they were for sale. I guess you guys felt differently and bought them. We are not concerned about them at all. My advice is to take a look at our patent portfolio before you make a final decision here."
The court filings also detail how Google developed its own no-hire agreements. Upon Google’s human resources director asking then-CEO and current executive chairman Eric Schmidt about sharing its agreements with competitors, "Schmidt responded that he preferred it be shared ‘verbally, since I don’t want to create a paper trail over which we can be sued later?’"
Google spokeswoman Niki Fenwick said that Google has "always actively and aggressively recruited top talent." Schmidt, meanwhile, is due to be questioned by plaintiff lawyers in February.
According to plaintiffs' counsel, U.S. Judge Koh hasn't decided whether to make the civil suit into a class action lawsuit. Apparently, it would could cost the defendants "hundreds of millions of dollars."
