A California judge has rejected the proposed settlement in a lawsuit over no-hire agreements used by top Silicon Valley tech firms, saying the amount being offered to compensate workers is too low.
The remaining defendants in the case — Apple, Google, Intel and Adobe Systems — had reached a deal with the worker’s lawyers to settle the case for US$324.5 million, but Judge Lucy Koh of the federal district court in San Jose, California, said that amount is too low.
After subtracting the fees for the workers’ lawyers — they’re allowed to keep up to a quarter of the award, or $81 million, as well as other money — each worker would be left with an average of only $3,750.
“The Court finds the total settlement amount falls below the range of reasonableness,” Koh wrote in her order, issued Friday.
She said she was troubled that the workers would get less money than under a previous settlement with companies that settled earlier in the case, even though the case has been progressing in the workers’ favor since then.
Last year, Intuit, Lucasfilm and Pixar settled with the workers before the case came to trial.
All of the companies were accused of striking secret deals to not poach each others’ workers, a violation of the Sherman Antitrust Act that reduced the workers’ potential to earn higher wages.
An expert hired for the case has estimated that the workers’ should receive damages of $3 billion, for wages they could have earned if the no-hire agreements hadn’t been in place.
The company agreed to settle the civil lawsuit, which was first filed in November of 2009 against a group of companies including Sharp, Epson, Hitachi and Toshiba for collusion on prices of LCD panels sold to Dell. A Sharp spokeswoman said the company made the decision independent of the other firms involved in the lawsuit, and the payment would settle the suit with Dell. Sharp did not name the two other companies besides Dell.
“After broadly considering factors such as the U.S. civil lawsuit system and the facts of this case, Sharp has determined that agreeing to a settlement is the best policy,” the company said in a statement.
Dell sought damages to recover funds it paid for LCD panels purchased at inflated prices. The lawsuit involved TFT (thin film transistor) panels, widely used in TVs, laptops and handheld gadgets.
Sharp said it is still determining the effect the settlement will have on its earnings. The company plans to book a special loss in the just-ended April-June quarter.
The U.S. government had sued Apple and five publishers, saying they conspired to fix the prices of electronic books. It has reached a settlement with three of the publishers that could lead to cheaper e-books for consumers.
In an email to Reuters, Apple spokesman Tom Neumayr confirmed the company’s position, which appeared earlier in a Wall Street Journal story.
“The launch of the iBookstore in 2010 fostered innovation and competition, breaking Amazon’s monopolistic grip on the publishing industry,” Apple spokeswoman Natalie Kerris told the Journal.
Kerris defended the current pricing structure as parallel to Apple’s mobile software store.
“Just as we have allowed developers to set prices on the App Store, publishers set prices on the iBookstore,” she told newspaper.