Siddharth Hariharan, et al v. Adobe Systems, Inc., et al

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Case No. __________ UNITED STATES COURT OF APPEALS FOR THE NINTH CIRCUIT IN RE HIGH-TECH EMPLOYEE ANTITRUST LITIGATION Petition for permission to appeal from the United States District Court Northern District of California The Honorable Lucy H. Koh, Presiding Case No. 5:11-2509-LHK DEFENDANT-PETITIONERS’ EXCERPTS OF RECORD VOLUME I OF VIII ROBERT A. VAN NEST, #84065 DANIEL PURCELL, #191424 EUGENE M. PAIGE, #202849 JUSTINA SESSIONS, #270914 KEKER & VAN NEST LLP 633 Battery Street San Francisco, CA 94111-1809 Telephone: 415 391 5400 Facsimile: 415 397 7188 Attorneys for Defendant and Petitioner Google Inc. 789556 EXCERPTS OF RECORD N.D.CAL. DOCKET # DOCUMENT PAGE Volume I of VIII (District Court Orders—Public Versions) 1. 531 Oct. 24, 2013 Order Granting Plaintiffs’ Supplemental Motion for Class Certification (public redacted version) 0001 2. 382 April 15, 2013 Order Granting in Part and Denying in Part Plaintiffs’ Motion for Class Certification (public redacted version) 0087 Volume II of VIII (Expert Reports – Public Versions) 3. 518-2 518-4 Expert Report of Professor Kevin M. Murphy (public redacted version) 0140 4. 424-2 Supplemental Expert Report of Edward E. Leamer, Ph.D. (public redacted version) 0340 Volume III of VIII (Expert Reports – Public Versions) 5. 440 Supplemental Expert Report of Professor Kevin M. Murphy (public redacted version) 0402 6. 442 Expert Report of Kathryn M. Shaw, Ph.D. (public redacted version) 0570 Volume IV of VIII (Depositions and Declarations – Public Versions) 7. 308-1, 445-2 Deposition of Edward Leamer 0676 8. 538-8 538-11 Declaration of Danny McKell in Support of Defendants’ Opposition to Plaintiffs’ Motion for Class Certification (public redacted version) 0691 1 789556 N.D.CAL. DOCKET # 9. 516-6 10. DOCUMENT PAGE Declaration of Frank Wagner in Support of Defendants’ Opposition to Plaintiffs’ Motion for Class Certification (public redacted version) 0713 District Court Docket Report 0725 Volume V of VIII (District Court Orders FILED UNDER SEAL) 11. Oct. 24, 2013 Order Granting Plaintiffs’ Motion for Class Certification (under seal version) 0804 12. 383 April 15, 2013 Order Granting in Part and Denying in Part Plaintiffs’ Motion for Class Certification (under seal version) 0890 Volume VI of VIII (Expert Reports FILED UNDER SEAL) 13. Expert Report of Professor Kevin M. Murphy (under seal version) 0944 14. Supplemental Expert Report of Edward E. Leamer, Ph.D. (under seal version) 1144 Volume VII of VIII (Expert Reports FILED UNDER SEAL) 15. Supplemental Expert Report of Professor Kevin M. Murphy (under seal version) 1180 16. Expert Report of Kathryn M. Shaw, Ph.D. (under seal version) 1348 17. Expert Witness Report of Kevin F. Hallock, Figure 7 1454 2 N.D.CAL. DOCKET # DOCUMENT PAGE Volume VIII of VIII (Depositions and Declarations FILED UNDER SEAL) 18. Deposition of Michael Devine 1455 19. Declaration of Danny McKell in Support of Defendants’ Opposition to Plaintiffs’ Motion for Class Certification (under seal version) 1458 20. Declaration of Frank Wagner in Support of Defendants’ Opposition to Plaintiffs’ Motion for Class Certification (under seal version) 1480 21. Exhibit 24 to Declaration of Lin W. Kahn in Support 1492 of Defendants’ Opposition to Plaintiffs’ Supplemental Motion for Class Certification 3 1 Case5 11 cv 02509 LHK Filed1024 13 Document531 Page1 of 86 1 2 3 4 5 6 7 8 UNITED STATES DISTRICT COURT 9 NORTHERN DISTRICT OF CALIFORNIA SAN JOSE DIVISION 10 11 California RE HIGH TECH EMPLOYEE ANTITRUST LITIGATION IN Case No 11 CV02509 LHK 12 Court of District 13 ORDER GRANTING PLAINTIFFS SUPPLEMENTAL MOTION FOR 14 CLASS CERTIFICATION District 15 States DOCUMENT RELATES TO 16 THIS 17 ALL ACTIONS Northern United the For 18 19 Plaintiffs Devine Mark Fichtner Siddharth Hariharan Michael 20 Daniel Stover 21 situated 22 Apple Inc 23 Ltd 24 conspired to suppress and actually 25 by 26 Act 15 Apple Lucasfilm not to and Pixar collectively solicit 1 and 5 2013 the Certification with leave and on behalf of Section to 4 Intel Corp Intel Defendants did suppress amend See class of all those similarly Plaintiffs Intuit in Apr 5 Act 15 Inc Intuit Lucasfilm 1 U SC to artificially of the Sherman ECF No 382 Motion No 11 CV 02509 LHK ORDER GRANTING PLAINTIFFS SUPPLEMENTAL levels Antitrust for Class Currently 1 Case low 15 part and denied in part Plaintiffs Class Cert Order Adobe allege that Defendants employee compensation of the Clayton Antitrust Court granted a former employersAdobe Systems Inc each other s employees in violation of Section US C April their Google Google Inc On 27 28 claims against allege antitrust agreeing Plaintiffs individually collectively Brandon Marshall and MOTION FOR CLASS CERTIFICATION before Case5 11 cv 02509 LHK Motion 1 the Court is Plaintiffs Supplemental 2 Cert 3 to 4 Reply 5 Plaintiffs Supplemental 6 Having considered 7 case 8 Plaintiffs proposed class of technical 9 I Suppl Class Cert Pls Suppl Mot the parties See Pls Suppl Mot an opposition filed and Plaintiffs Reply ECFNo 455 for Class Certification 86 of on August Opp n a reply filed See law and submissions arguments the relevant Defs see The Court held 8 2013 Class Pls on a hearing ECF No 495 the record in this Motion for Class Certification and CERTIFIES Plaintiffs Supplemental employees Class Technical BACKGROUND A 10 Factual Background 1 11 California Motion Defendants Opp n ECF No 439 Suppl Class Cert GRANTS the Court Suppl Page2 Class Certification for Mot ECF No 418 Class Cert Supp Suppl Mot Filed1024 13 Document531 12 The Parties Defendants are leading high tech companies each with a principal place of business the in Court of San Francisco 14 products 15 2011 16 District 13 search provider 17 went public in 18 largest semiconductor 19 Adobe 20 nearly 21 programs Opp n 22 Lucasfilm is 23 producing box 24 Pixar is a leading 25 acquired Apple Valley area of California Silicon Defs and software Opp n to Pls Mot 108 billion is a market leader in consumer computer Opp n at 5 ECF No 209 Class Cert In District Apple s revenues exceeded total Id Google the world s leading is internet States Dr Edward E Report of Northern United the For 2004 specializes 3 chip maker 5 In Id 2011 a film production Intuit 27 Devine worked 28 Consolidated 16 38 2011 In the Star for are software engineers Adobe CAC See id 13 Intel In 54 No earned 19 In Rep 17 animation expertise and for Jones franchise 2006 Walt Id 18 Disney Productions Id who were former employees of Defendants from October of 2006 to July of 16 ECF No 65 Decl Ann B Shaver 11 CV 02509 LHK ORDER GRANTING PLAINTIFFS SUPPLEMENTAL billion Leamer 2 Case the world s is 2009 Adobe 3.8 billion films and the Indiana in the State of Washington Amended Complaint 2011 Id Google in financial planning and tax preparation computer animation film studio Id Plaintiffs 15 ECF No 190 earned approximately for its computer Wars 7.4 billion Intel revenues exceeded company known office hits including Rep billion in software specializes the company s Pixar for approximately Named Id media and marketing billion in revenues 26 Leamer and reached revenues of nearly in digital at Leamer MOTION FOR CLASS CERTIFICATION 2008 in See Supp Pls Case5 11 cv 02509 LHK Decl Ex 6 1 ECF No 1 Mot 2 Arizona from July of 1993 through November 3 of 4 from January of 2007 through August of 5 worked 6 Shaver 7 2006 through December for Class Cert 2011 for Shaver CAC 17 See Adobe Decl Ex in 9 9 Ex See of 2009 See for from worked CAC 18 Page3 CAC 20 Shaver May of for Intel in May 2008 through for Lucasfilm in California 1 Decl Ex 8 Shaver 2006 through December Intuit 86 of worked Fichtner again Hariharan Finally Stover worked for Market of 2006 in California from Decl Ex 10 Marshall CAC 19 See November 1 at least of High Tech Employees assert that in a properly Plaintiffs 1 2008 291 2006 and of 7 California from July of 2 8 Decl Shaver 1 Filed1024 13 Document531 and lawfully competitive labor market each functioning 10 11 California Defendant would compete for employees by soliciting current employees from one or more of the other Defendants 12 calling 13 telephonically 14 applied includes CAC 41 See communicating This method of recruiting to which Defendants refer as manner including directly in any cold orally in writing Court of District for or electronically with another employee who has company s not otherwise a job Id District 15 Plaintiffs allege that cold calling is a key competitive tool that companies use to recruit States 16 employees 17 recruiting employees from competitors a 18 has expended 19 a particularly high tech employees with advanced skills and abilities 45 Id Through Northern United the For cost 20 on Plaintiffs by removing an able to take advantage employee on whom the rival further contend that the use of cold calling 21 increases 22 Most 23 with opportunities 24 increased 25 that the compensation 26 calls 27 calling have a broader 28 technical directly is of the efforts its rival in soliciting interviewing and training skilled labor while simultaneously inflicting the rival total company compensation all of secure higher compensation wages either Id among Defendants commonly calling provides by switching to a rival with the recipient s current employer Id allege the effects of cold calling common employees Id 46 company or by No who receive and the effects of eliminating impact on Defendants salaried employees especially 50 11 CV 02509 LHK ORDER GRANTING PLAINTIFFS SUPPLEMENTAL negotiating Plaintiffs further allege 3 Case 48 50 of a cold call the recipient effects of cold calling are not limited to those individuals Rather Plaintiffs 44 Defendants employees See id allege that the practice of cold Plaintiffs to and mobility for may depend MOTION FOR CLASS CERTIFICATION cold their the Case5 11 cv 02509 LHK 3 1 Filed1024 13 Document531 Defendants Page4 of Alleged Conspiracy Between approximately 2005 and 2009 Defendants Adobe Apple Google 2 3 Lucasfilm 4 among Defendants 5 interconnected 6 soliciting each other s 7 company under the control 8 Apple and or company 9 55 57 and Pixar allegedly engaged web a for skilled labor of express in an overarching conspiracy 55 Id see also 12 id The conspiracy agreements among Defendants bilateral employees Id 55.1 of Steve Jobs Plaintiffs CoFounder that shared at least one with Apple s Board of Directors limits to other Defendants 12 bilateral 13 88 100 105 These agreements were not limited by geography job function 14 time period Nor were they 15 Defendants agreement applied Class Cert to all employees of Class Cert a given employees off each Defendant s putting Mot Id CEOto CEO emails and 11 Pls Mot from actively FormerChairman and FormerCEO of director Do Not Call lists thereby of an allege that each agreement involved a other including competition consisted abstain to Defendants memorialized these nearly identical agreements in documents Intel Intuit to eliminate 10 California 86 at 1 ECFNo pair of Defendants See 187 Each CAC 63 76 81 Court of District related to any specific business product group or between or other collaboration District Id States 16 Plaintiffs 17 overarching conspiracy 18 of accomplishing 19 through eliminating 20 senior executives 21 generally 22 55 108 Defendants entered allege that into the express agreements and entered into the Northern United the For 27 28 actively Procedural DOJ investigated 1 The to reduce competition for skilled labor concealed each bilateral Id participation and with the intent employee compensation and 55 Plaintiffs mobility also allege that Defendants agreement and that Defendants employees Department Defendants of Justice Investigation the Antitrust Division employment and parties refer to these agreements as agreements of the United recruitment States practices Do Not Cold Call agreements and anti competitive anti solicitation agreements anti poaching agreements refers to these agreements as agreements Department Id No anti solicitation In this Order 11 CV 02509 LHK ORDER GRANTING PLAINTIFFS SUPPLEMENTAL of Justice 3 111 4 Case Id Background From 2009 through 2010 26 objective the conspiracy s 1 24 25 of the other Defendants were not informed of nor did they agree to the terms of any of the agreements B 23 with knowledge MOTION FOR CLASS CERTIFICATION the Court Case5 11 cv 02509 LHK 1 Following 2 United 3 ECF No 79 1 Ex its v States DDC June 4 investigation the DOJ 3 2011 States DOJ v Lucasfilm Lucasfilm J DOJ proposed final judgments in each case See 6 proposed final judgments Defendants 7 agreed be 8 any other person 9 otherwise competing for employees of the other 4 CAC 11 judgments on March 12 CAC 115 The refrain Adobe from ing and June DOJ B The DOJ J DOJ Lucasfilm J 3 2011 DOJ See stipulated law but they recruiting or J J at 5 DOJ Lucasfilm entered Adobe also filed 1 at any agreement with soliciting cold calling Columbia J Adobe 2636850 or violation of person DOJ Adobe See In these stipulated enter into maintaining or enforcing to District Court for the District of 17 2011 Defendants No 10 2220 2011 WL did not admit any wrongdoing attempting any way or in 10 California from enjoined Inc 86 of DD C Mar 7 2011 2 at ECF No 79 1 Ex 5 to Page5 complaints in federal court against filed Inc No 10 1629 Adobe Systems A United Filed1024 13 Document531 proposed the stipulated at final J at 12 DOJ Lucasfilm J at 1 115.2 Court of District 2 13 The Instant Action a 14 Removal Case and Preliminary Motions Consolidation District The 15 five cases underlying this consolidated action were initially filed in California Superior States v 16 Court Hariharan 17 2011 ECF No 18 filed 19 Clara Super 20 204187 21 No 11 CV 205090 No 11 CV574066 Adobe Sys Inc Case Northern United the For 22 23 28 2011 ECF No 43 2 Ct Santa Clara Super Ct filed removed July 19 2011 see Ct removed filed see ECF No ECF No 41 Devine Fichtner July 14 these five state District of California May 23 2011 Adobe Sys Inc Case v Hariharan 1 Marshall v v Adobe Sys May 4 filed Santa Clara Super No 11 CV 204053 Adobe Sys Inc Case 30 2011 ECF No 43 3 June Santa Clara Super Court for the Northern v Devine 28 2011 ECF No 43 1 June filed No 11 CV204052 Adobe Sys Inc Case Defendants subsequently 24 25 June 1 Marshall v Alameda Super Ct v Stover Ct Santa No 11 CV Adobe Sys Inc Case 2011 ECF No 43 4.3 court actions v States Inc Case Inc Case No 11 3538 Case No 11 3539 District No 11 2509 Adobe Sys Adobe Sys Inc to the United removed removed July 19 26 2 27 3 28 Under the provisions of Section 5 a of the Clayton Act 15 US C judgment has no prima facie effect in any subsequent private lawsuit While the name of each Superior Court case also named Apple Google Case No Intel Intuit listed only Lucasfilm Adobe 16 a brought the proposed final against as the defendant Pixar and Does 1 200 the complaints as defendants 5 11 CV 02509 LHK ORDER GRANTING PLAINTIFFS SUPPLEMENTAL Defendants MOTION FOR CLASS CERTIFICATION Case5 11 cv 02509 LHK ECF No 41 1 2011 2 see 3 ECF No 41 On 4 from Magistrate Judge Spero see ECF No 41 On 5 July Fichtner v and Stover June v Adobe Sys Inc Case Adobe Sys 1 2011 the 19 2011 Filed1024 13 Document531 Inc Case Defendants collectively ECF No 41 v 6 actions 7 involve 8 there 9 they were heard before different judges Defendants believe 10 Armstrong Motion to on 11 California 86 removed removed July July 19 2011 19 2011 Adobe Systems Inc was a motion filed Motion to Relate of see reassigned ECF No 24 Judge Armstrong See to No 11 3540 No 11 3541 case Hariharan lead Page6 Plaintiff 12 ECF No 56 13 relate the five underlying to b ecause 58 See substantially In the same the Defendants stated that events and allegations parties would be an unduly burdensome duplication granted the moved Hariharan Siddharth Relate Judge Armstrong to granted July transfer the of labor and because and expense 27 2011 they are appears likely that or conflicting related Id ECF No 52 On See the related actions Motion it at results 3 2 2011 August 4 2011 See if Judge San Jose Division to the on August to Transfer the cases See ECF No Court of 5 2011 the 14 On 15 judge See 16 District the individual 17 conduct of proceedings 18 consolidated 19 the Consolidated August five related underlying actions were reassigned to the undersigned District ECF No 60 On 6 2011 the September parties filed a joint stipulation to consolidate States cases avoid duplication to to and unnecessary costs and promote the efficient Northern United the For 20 ECF No 63 at Defendants 21 and 22 see 23 part and denied in part 24 Dismiss on April on September Complaint a Joint filed Motion to Dismiss with leave of the Court Lucasfilm ECF No 83 Following a hearing Defendants 18 2012 see b 25 On 26 27 expert 28 certification October filed motion of the Plaintiffs its to Joint Motion this joint 12 2011 13 2011 the CAC on separate on January see See ECF No 64 October to the Court Plaintiffs 13 2011 see No ECF No 79 Dismiss on October ECF No 108 17 2011 the Court granted to Dismiss and denied Lucasfilm s Motion Initial Motion to for Class Certification their Motion motion See Class Cert for Class Certification along with Mot sought certification of an All Leamer Rep Employee class which included 11 CV 02509 LHK ORDER GRANTING PLAINTIFFS SUPPLEMENTAL an In their class 6 Case filed CAC See Motion 26 2012 stipulation ECF No 119 1 2012 Plaintiffs filed report in support Pursuant on September the five underlying actions Amended 2 MOTION FOR CLASS CERTIFICATION in Case5 11 cv 02509 LHK 1 every salaried employee throughout 2 and 3 employees See id 4 salaried technical 5 Cert 2009 Class Cert Mot 1 Plaintiffs estimated Plaintiffs and research creative November 12 2012 Opp n by 9 Certification and in Opposition to the see Plaintiffs see as well as ECF No 210 filed a Motion to Certification 8 then Plaintiffs for Defendants between 2005 more than 100,000 sought certification of a more limited class of employees Class Technical in 11 Administrative 12 to Class Certification 13 The Court held 14 Opposition to Plaintiffs Motion their Strike filed Motion to Reply ECF No 247 On Mot 10 California 86 of that this class included and development Defendants 7 Supp who worked States In the alternative 5 at the United Page7 Class 1 at On 6 at Mot Filed1024 13 Document531 the expert their report declarations submitted Consolidated Reply in Support of Class on December Strike and for Class 10 2012 Pls 9 2013 Defendants Consol Reply ECF No 282 of Motion for Leave to Supplement ECF No 263 see January to the which Record Plaintiffs in Support of filed a Joint filed Defendants Opposition an opposition see ECF No 270 Court of District a hearing on Plaintiffs Motion for Class Certification on January 17 2013 See District On 15 April 5 2013 the Court granted part and denied in part Plaintiffs in Motion for Class States amend Apr 5 Class Cert Order Specifically 16 Certification with leave 17 to certify 18 Cabraser 19 appointed as Class Counsel the law firms that had served on the Executive 20 Montague 21 have vigorously to See the Court declined Northern United the For the class but it did confirm as final Heimann P A and Grant prosecuted The Court 22 Bernstein part Plaintiffs request 24 49 52 25 Supplement first 28 PA Eisenhofer this action the Joseph to strike Id at Saveri 47 and will continue Defendants Motion expert prior interim appointment to Law the Record satisfied in Support of in part and denying to the requirements of Rule Counsel and Committee Berger Strike and granted that these firms in part and denied in report and certain employee in part Plaintiffs 23 a Co Lead of Lieff do so Id Defendants Opposition noted that Defendants did not dispute Firm as The Court recognized Finally the Court denied Defendants Joint Administrative In granting 27 and further denied Defendants 23 26 LLP the Court s Motion for declarations Leave to Class Certification Motion No Id at 52 the Court Plaintiffs assertion that both of the proposed classes numerosity commonality typicality and adequacy 11 CV 02509 LHK ORDER GRANTING PLAINTIFFS SUPPLEMENTAL MOTION FOR CLASS CERTIFICATION at to for Class Certification 7 Case Id of Case5 11 cv 02509 LHK Id 9 citing Class Cert 1 representation 2 17 3 proposed classes satisfied Rule 4 doing 5 overwhelmingly 6 Plaintiffs 7 with respect to damages 8 However 9 at Tr 5 1015 ECF No 321 common satisfied their 23 Mot As such at the Court found that b3 legal and factual 23 Id at b3 at 46 Tr of of the initial Class Certification issues Id at 2013 Class Cert H rg alleged 13 on whether Jan Plaintiffs predominate questions In so on violation will turn antitrust In addition the Court found that burden on the issue of the predominance on not find based Motion the evidence available of common on members issues Technical 12 documentary 13 individual 14 concern that Plaintiffs 15 resources 16 at 17 analysis 18 100,000 members of the All Employee Class were affected 19 id 20 be important 21 that Defendants 22 criticized the reliability admissibility 23 The Court 24 Plaintiffs initial 25 certifying Plaintiffs the impact of the alleged Class would predominate evidence weighed violation under Rule heavily in 23 to Plaintiffs adequately demonstrated that that Plaintiffs 11 California common of Defendants 10 to 17 86 of issues 44 the Court could with regard Jan Page8 the Court focused its analysis s requirement that the adjudication Rule Filed1024 13 Document531 b3 44 45 Id at favor of finding of the All that common Employee Class or Although common the time at Plaintiffs predominate issues over Court of District ones for the purpose of being able to prove examplessuch impact antitrust as email exchanges between the Court expressed CEOs and discrete human District documents from certain Defendants in particular years might not be See id sufficient States 33 The Court found might need that Plaintiffs additional documentary support or empirical Northern United the For In demonstrate that to particular In so 28 significant common to assure the Court that many contested also questioned doing 27 evidence could be used to prove that the Court found that additional Motion The Court 26 common documentary or nearly all the anti solicitation agreements support issues predominated or empirical over individual analysis issues and persuasiveness of Plaintiffs statistical No would given analyses Id whether Plaintiffs All Employee Class was overly broad and noted that for Class Certification provided afforded made Plaintiffs leave clear that it amounts of discovery or to amend little the All to address was keenly aware make key witnesses discussion or analysis to support Employee Class See id the Court s that Defendants available concerns for depositions 29 See id at until after the 11 CV 02509 LHK ORDER GRANTING PLAINTIFFS SUPPLEMENTAL at had failed to produce 8 Case See bases of Plaintiffs theories of harm and actively of the factual more limited Technical Class over the Court by all MOTION FOR CLASS CERTIFICATION 52 Case5 11 cv 02509 LHK on Motion Filed1024 13 Document531 1 hearing 2 failure 3 proposed classes satisfied the Rule 23 requirements Plaintiffs and to produce documents On May 10 2013 4 filed on demonstrating that common focuses 6 requirements of Rule 7 the Supplemental 8 evidence of predominance 9 the Technical Class 10 Supplemental Motion 11 filed 12 Suppl Reply Subsequently 13 ECF No 469 Plaintiffs 14 Defendants improper Sur Reply 15 485.4 The parties have 16 the Supplemental 17 at 47 their of 86 The Court noted hindered Plaintiffs witnesses Plaintiffs 5 California Id for Class Certification Page9 efforts to Defendants that demonstrate that their Id Supplemental Motion for Class Certification which 491 496 498 499 505 their 23 b3 Motion issues with respect with respect 22 25 at to the impact Defendants Reply in support Defendants filed Mot concerns regarding violation on at In or nearly all of all Opposition to Plaintiffs their 21 2013 objections 2 the the Court s Motion of their Supplemental Suppl Class Cert Class of the antitrust filed on June for Class Certification the purpose of satisfying the for the Technical to specifically address Plaintiffs See id predominate See Suppl Opp n on for Class Certification evidence to certain in Plaintiffs then 12 2013 July Reply Plaintiffs Court of District a motion then filed ECF No 479 73 d1 and Local Rule to enforce which Defendants to to strike ECF No an Opposition filed District filed motions for leave to various file statements of recent decisions while States Motion for Class Certification has been pending before this ECF Nos Court Northern United the For On 18 July 12 2013 and Defendants 19 Plaintiffs 20 and class claims alleged 21 No 22 4 23 24 453 On The Court July 30 Plaintiffs the 2013 GRANTS IN CAC on 26 and to settle Counsel filed DENIES IN PART all individual Class See ECF a similar letter informing the Court Defendants Objections to Evidence in Suppl Class Cert ECF No 469 The Court GRANTS Defendants Motion to Strike Ms Sandberg s declaration as improper Id citing Contratto v Ethicon 227 304 308 n5 Cal 2005 striking witness declaration because it was an attempt to introduce new evidence in connection with their reply papers The Court DENIES Defendants request to FRD ND supplement the record as to the deposition cite impermissible excerpts were properly to which regarding request cite Dr the motion the record Leamer s it Civ All of the excerpts Defendants L R 73 d1 as to the deposition is Defendants request proper rebuttal analysis superadditive theory in request The Court testimony of were not submitted by Plaintiffs and thus The Court DENIES salary ranges because to strike on to supplement Defendants Dr Murphy testimony of submitted to the Court by Plaintiffs further argument request complete the record 28 a letter informing the Court that Pls Reply Supp Defendants 27 filed of Plaintiffs proposed Technical CoLead Plaintiffs PART behalf Defendants 25 Class Counsel and Lucasfilm Ltd reached an agreement Pixar in CoLead GRANTS Dr Shaw may to Dr Leamer s analyses Court GRANTS Defendants his rebuttal report 9 No 11 CV02509 LHK ORDER GRANTING PLAINTIFFS SUPPLEMENTAL as the be provided to strike The to which constitutes Case MOTION FOR CLASS CERTIFICATION Case5 11 cv 02509 LHK and Defendant 1 that Plaintiffs 2 claims alleged in 3 On 21 2013 4 PreliminaryApproval 5 Court Due 6 purposes against September 7 8 9 on all Motion Supplemental Pls Suppl Mot for Class Certification non settling based on 12 Proposed 13 agree that these proposed settlements 14 Technical 15 class whether for 16 591 619 1997 Hanlon 17 II against the and several and Lucasfilm ECF No 489 See Intuit a Motion for filed pending before this is of a class for litigation certification and Intel and class See Suppl Reply at 1 do not have any impact on n1 Plaintiffs Impact of the Proposed Settlement preserve noting that the settlements Plaintiffs Defendants for the entire amount of Plaintiffs damages under the liability That motion Pls Br Re See Class Cert ECF No 483 right to litigate Pixar only seek parties agree that the settlements 11 California now Adobe Apple Google 10 joint ECF No 501 of Class Settlement to the settlements Plaintiffs Nonetheless Class and Defendants Pixar Lucasfilm and 86 of individual all of Plaintiffs proposed Technical behalf Plaintiffs Defendants Page10 also reached an agreement to settle Intuit CAC on the Filed10 24 13 Document531 on Settlements laws Defs antitrust the Suppl Class Cert Br Re Joint the Impact of the Mot ECFNo 484 Plaintiffs Court of District Class have no effect on the pending motion Generally the same Rule 23 standard for certification of the of a proposed applies for certification District or settlement litigation purposes Amchem Prod Inc See v Windsor 521 US States v Chrysler Corp 150 Northern United the For Named Plaintiffs now seek certify only a nationwide to and development employees who worked 19 and research 20 participated 21 bring before the Court a proposed class 22 contributed 23 jealously 24 Suppl in at to least one anti solicitation Defendants Mot at 2 Specifically development or more fields that are May 2005 through December 28 Intuit who work 2009 functions whom seek to employed on a Apple d creative from March Thus recruited Class defined and or research this and States No f b e Lucasfilm from January 2005 11 CV 02509 LHK ORDER GRANTING PLAINTIFFS SUPPLEMENTAL by one Google from March 2005 10 Case case 2005 through December 2009 c and as follows 2005 through December 2009 December 2009 Plaintiffs employees whose work a salaried basis in the United from March December 2009 Intel from June 2007 through Defendant the Defendants heavily a Technical creative while that Defendant Defendants conspiracy and certify in the technical through for any Defendant agreement with another at the very crux of Plaintiffs of the following Adobe from 27 Cir 1999 class of salaried technical comprising those technical core business guarded and who appear All natural persons 26 9th PROPOSED CLASS DEFINITION 18 25 F3d 1011 1019 23 MOTION FOR CLASS CERTIFICATION Case5 11 cv 02509 LHK 2009 through December 1 Excluded 3 6 7 8 9 10 11 California 12 and senior executives of 86 January 2005 through December employees retail Page11 corporate members officers 2009 of the of all Defendants 5 Id at iii The proposed Technical Class consists 4 5 g Pixar from or from the Class are boards of directors 2 Filed10 24 13 Document531 ECF No 190 Report Animators Digital Artists Creative 11 Web Graphic Artists 14 Administrators and B Rep App Leamer people Class Cert 7 Quality Designers 12 Developers 13 IT Professionals 10 Mot at and Component 9 and Development Graphic Designers and by their that this proposed class includes believe Plaintiffs Leamer Systems Engineers and employees classified as technical professionals 155 the 6 User Developers 8 Research Analysts and Technical Editors Directors B to Appendix 2 Hardware Engineers Engineers 4 Programmers 5 Product Developers or User Experience Interface 1 Software including 3 Application Designers of job titles identified in employers See more than 50,000 5 Court of District 13 LEGAL STANDARD III Class actions 14 by Rule 23 are governed of the Federal Rule 23 Rules of Civil Procedure District 15 does not set forth a mere To standard pleading obtain class certification Plaintiffs bear the burden States showing 16 of 17 subsection that they have met each of the four requirements of Rule 23 a and at least one Northern United the For 18 F3d 1266 273 compliance 19 22 23 24 25 26 numerous that common Cir 2001 with the v Zinser A party joinder of all to the class 3 the a the interests of the class is Stores Inc court district members impracticable 4 the As discussed All above in the initial Employee Class Court denied Plaintiffs 28 certification have Accordingly Motion consisting affirmatively 1 the class is so parties are typical of the parties will fairly and adequately of representation for Class Certification satisfy Employee and Technical to certify No to maintain a class action Plaintiffs also sought to certify Mot at 1 classes without prejudice only the Technical Class Order pertains only to that Class 11 CV 02509 LHK ORDER GRANTING PLAINTIFFS SUPPLEMENTAL protect the requirements of 11 Case 2011 of law or fact are questions That is the class must Motion moved demonstrate S Ct 2541 2551 more than 100,000 employees Class Cert of both the All in their Supplemental this of 1180 1186 amended by a class only if 2 there representative R Civ P 23a 131 of the representative numerosity commonality typicality and adequacy 5 v Dukes F3d must certification may certify claims or defenses Fed Inst Inc 253 seeking class Rule Wal Mart that Research Accufix claims or defenses of the class and an 27 9th 23 b 23 a provides Rule 20 21 of Rule MOTION FOR CLASS CERTIFICATION The Case5 11 cv 02509 LHK v Am Honda 1 Mazza 2 is silent 3 requirement as well See 4 F3d 581 588 satisfy through v 7 Corp 8 actions 9 substantial evidentiary 9th Cir 2012 of 86 A class may be 10 A class may be 11 act 12 declaratory 13 a 14 to class 15 class action 16 controversy on grounds proof certified 23 a 23 appropriate b2 23 b Rule b1 upon adjudications under Rule from showing separate ND Cal a the class as types Fed of class R Civ P 23b1 the class has acted injunctive whole Fed Comcast that there is a risk of actions the party opposing if 23 b of Rule sets forth three general a to the class so that final respecting 672 this satisfied a court must also find that Plaintiffs 23 under Rule that apply generally is FRD 666 at least one of the three subsections or inconsistent certified relief 23 a are of Rule Further while Rule have held that the Rule implies courts LCS Fin Servs Corp 274 S Ct 1426 1432 2013 Behrend 133 prejudice ascertainable eg Herrera v four prerequisites If all 666 must be as to whether the class 5 California Co Inc Page12 2011 6 Motor Filed10 24 13 Document531 relief or refused to or corresponding R Civ P 23b2 Finally Court of District class may be under Rule certified 23 b3 a court finds that if members predominate over any questions of law or fact questions membersand only individual affecting common that a District is superior to other available States Fed Northern United the For methods for and efficiently adjudicating fairly R Civ P 23 b3 17 A 18 with the merits of the 19 Funds 133 20 at 21 whether the party seeking certification has met the prerequisites 22 F3d 23 S Ct 24 class 25 opt 26 predominate 588 27 28 court s class certification underlying plaintiff s S Ct 1184 1194 1186 at 1432 This 2013 out how and how quoting those provided over individual the certification trial Dukes 131 Inc b1 for duty to take a b2 close 23 a and class look at rigorous entail see also quoting No F3d eg Zinser 253 Comcast safeguards an common for opportunity 133 b3 to questions ones Rule 23 grants courts stage Amgen 133 S Ct at no license to engage 1194 95 in free ranging merits inquiries at Merits questions may be considered to the 12 Case Trust Mazza 666 23 b procedural whether overlap analysis to determine Rule members some Ret Plans and 23 of Rule addition al or v Conn S Ct at 2551 court must conduct a Congress included a court has a Nevertheless claim Amgen rigorous analysis applies to both Rule discussing members beyond must be rigorous and may analysis Before certifying a class the at the 11 CV 02509 LHK ORDER GRANTING PLAINTIFFS SUPPLEMENTAL MOTION FOR CLASS CERTIFICATION Case5 11 cv 02509 LHK 1 extent 2 prerequisites 3 party has 4 253 5 IV extent but only to the F3d its of 86 Id are satisfied 1195 at If a 23 court concludes that the burden of proof then the court has broad discretion to certify the class moving Zinser 1186 at DISCUSSION The Supreme Court has long recognized 6 laws As enforcement 8 US 251 262 9 envisaged by Congress This system depends of antitrust every violation 1972 10 strong competition depends 11 Co v United States 356 12 charter of 13 It 14 allocation 15 conductive economic the in aimed 1958 at laws on a serve is a blow to competition for strong with valuable antitrust Oil Co 405 the free enterprise system its and vigor and health legislation See also The Sherman Act was designed free and unfettered preserving role in the Hawaii v Standard stated in of the antitrust turn on compliance US 1 4 liberty that class actions Supreme Court 7 California Page13 that they are relevant to determining whether the Rule for class certification met Filed10 24 13 Document531 N Pac Ry to be a comprehensive competition as the rule of trade Court of District rests on the premise that the unrestrained of our economic interaction while resources at the of competitive forces will yield the best same time providing an environment District sic to the preservation of our democratic and social institutions political States Thus 16 open to the door of justice to individuals harmed by antitrust violations while at Northern United the For same time 17 the 18 attorneys general 19 Brunswick 20 Congressional debates 21 sponsors saw treble damages both as a means of 22 wrong suffered and 23 v 24 treble damage and injunctive 25 well the high purpose of enforcing 26 Sonotone 27 to the limited resources 28 deterring penalizing in antitrust Corp Hazeltine v Pueblo actions Bowl concerning 442 Congress chose to allow individuals and to recover OMat Inc 429 treble means damages damages giv ing of enforcing US 100 13031 1969 1977 provisions the injured the to serve as private for their injuries US 477 486 n10 the Clayton Act s as an important Research Inc 395 Corp violators antitrust law citing the initial as evidence that the party ample damages see also Zenith The purpose No Radio of giving private for the Corp parties remedies was not merely to provide private relief but was to serve as the antitrust US 330 344 available to 1979 laws these the Department As the private suits Supreme Court noted of Justice for enforcing the antitrust violations 11 CV 02509 LHK ORDER GRANTING PLAINTIFFS SUPPLEMENTAL in Reiter v provide a significant supplement 13 Case See MOTION FOR CLASS CERTIFICATION laws and Case5 11 cv 02509 LHK Filed10 24 13 Document531 an Page14 1 Plaintiffs 2 employee compensation 3 agreements restrained trade and were thus per se unlawful under Section 4 Antitrust 5 form of 6 States or with foreign 7 Co 51 F3d 1421 1431 8 private parties to sue antitrust 9 trust 11 now 12 damages nations is at 1 see declared and for the to suppress to Plaintiffs Defendants 1 of the Sherman Every contract combination commerce among the also Rebel Oil 4 that Section Co v the in several Atl Richfield of the Clayton Act allows damages DOJ ultimately put an end to Defendants to compensate bring this case as private attorneys general for themselves 1 of trade or explaining violators for was unable U SC According be illegal see to contend that although the the government 15 86 overarching conspiracy CAC 55 in restraint Cir 1995 9th into low levels or otherwise or conspiracy Plaintiffs agreements to artificially 2 Class Cert Mot Act Id 10 California allege that Defendants entered of Class of the conspiracy the victims to pick Class Cert up where Mot at illegal the DOJ left off Plaintiffs to seek 1 Court of District A 13 14 Rule 23 a and Class Representatives assert that their Plaintiffs proposed Technical Class satisfies the elements of Rule 23 a District 15 numerosity commonality typicality and adequacy 16 Fed 17 See Jan 17 of representation Class Cert Mot at 4 6 see States Northern United the For R Civ P 23a 18 Tr at Defendants do not contest 510 15 Nevertheless First the Court finds that Plaintiffs 23 a 1 19 Pursuant to Rule 20 members 21 potential 22 Chems Antitrust 23 the specific 24 parties agree that the Technical 25 Mot 26 impracticable 27 28 at is Plaintiffs must impracticable class Fed 4 Thus Second requirement at have show Gen bright line Tel finds joinder Plaintiffs requires that s need not ND Cal 2005 numerosity requirement numerous that minimum threshold state the exact Rather members there are questions Rule Fed 23 a 1980 In this No examine case the be R Civ P 23a1 2 s commonality of law or fact common 11 CV 02509 LHK ORDER GRANTING PLAINTIFFS SUPPLEMENTAL of See Class Cert 14 Case number In re Rubber of this proposed class to See of all the Court must approximately 60,000 employees of all joinder requirement US 318 330 the numerosity requirement is satisfied 23 a 2 a1 23 the class is so the Court finds that Plaintiffs have satisfied Rule these requirements each in turn Rule Co v EEOC 446 Class includes The Court satisfied that FRD 346 35051 facts of each case 5 Opp n the Court addresses R Civ P 23a1 members nor is there a Litig 232 that Plaintiffs have satisfied MOTION FOR CLASS CERTIFICATION to the class Case5 11 cv 02509 LHK 1 2 the class 3 depend S Ct at 2250 51 Dukes 131 members have upon 4 resolve 5 quotation 6 common 7 apt to drive 8 original 9 do a an issue that is To suffered common satisfy the commonality contention Nevertheless conspiracy antitrust very nature 12 fact 13 amended 14 Dynamic Random Access Memory exist a conspiracy In re Court of District Id TFT LCD in part by Panel Flat in one e ven must stroke Id 2551 at will internal common of a answers marks omitted emphasis in common question a single will omitted compels a finding Antitrust Litig No 07 1827 2011 WL 3268649 DRAM that truth or falsity its proceeding to generate has been alleged courts action antitrust members claims class internal quotation 23 a2 for purposes of Rule 11 of of a classwide the capacity internal punctuation and citations Where an claim must show Plaintiffs determination of that 86 of must demonstrate not merely the existence Plaintiffs of the litigation the resolution 2556 a nature central to the validity of each question but rather at 10 California of such Page15 requirement same injury meaning that the marks and citation omitted Id Filed10 24 13 Document531 267 have consistently that common FRD 583 the of law and questions ND Cal 2010 593 ND Cal July 28 2011 Antitrust Litig held that quoting In re No 02 1486 2006 WL 1530166 at 3 District 15 ND Cal June 5 2006 Antitrust liability alone constitutes a common question will that States 16 resolve 17 131 18 not on the conduct of individual 19 FRD 20 Defendants 21 issues Apr 5 22 common issues 23 the existence 24 liability the Court finds that the proposed class meets the commonality 25 23 Northern United the For an issue that S Ct at 2551 310 at citing alleged is central to the validity of each class because proof of an alleged class cases Indeed antitrust and of at least one members fact at 13 will focus TFT LCD on overwhelmingly Tr question at 18 2 8 in one stroke Dukes on defendants Flat found that Moreover Defendants do See Jan 17 common In re the Court has already violation will turn Class Cert Order of law conspiracy member s claim Panel Antitrust the adjudication common not conduct and legal dispute and Litig 267 of factual that there are some Because Plaintiffs have demonstrated capable of generating a common answer antitrust requirement of Rule a2 26 Third 27 Under 28 reasonably the the Court finds that Plaintiffs permissive standards co extensive of Rule have 23 satisfied a3 with those of absent class Rule 23 representative a3 s typicality requirement claims are membersthey need not be typical No 11 CV 02509 LHK ORDER GRANTING PLAINTIFFS SUPPLEMENTAL they are substantially 15 Case if MOTION FOR CLASS CERTIFICATION Case5 11 cv 02509 LHK F3d Filed10 24 13 Document531 v 1 identical 2 2003 3 the action 4 members have been 5 F2d 497 6 typicality requirement is to assure that the interests of the 7 interests 8 In antitrust 9 alleging Hanlon 150 The is based on conduct which cases See v Ellis antitrust 2010 11 F Supp 12 individual 13 compensation 14 Tr 15 Act a 16 align with the interests 8742757 same the Hanon v case F3d 970 v Cir 9th The purpose all 976 of the align with the 984 85 and other class Corp Dataproducts representative by plaintiffs Pecover 21 2010 In this 657 957 plaintiffs and whether named Corp 86 or similar injurywhether marks and citation omitted by defendants ND Cal Dec employers allege conduct will be established ED NY 1998 2d 231 241 of Costco Wholesale violations 11 at named not unique to the internal quotation typicality usually 10 California is same the of F3d 938 Inc 327 Boeing members have other same course the Cir 1992 9th same by injured of the class WL accord Staton of typicality is whether test 508 the 1020 at Page16 Cir 2011 9th members class No 08 2820 Elec Arts Inc quoting In re Playmobil Antitrust Litig 35 class all injuries arising membersregardless of their from common conduct suppression of Court of District Aug 8 due to Defendants anti solicitation Tr at 19 11 14 ECF No 494 agreements We re alleging See 8 2013 Aug Class Cert Hr g a single violation of the Sherman District single conspiracy Accordingly the Court finds that the named Plaintiffs interests States Northern United the For 17 of the class and the typicality requirement of Rule Finally the Court finds that 18 adequacy of 19 plaintiffs and 2 whether 20 a their named counsel and plaintiffs F3d 21 the 22 Class members share an class Hanlon 150 any have at interest 23 under Rule class representative a4 turns conflicts of interest counsel will their 1020 As 23 a satisfy Rule Plaintiffs stated on two s adequacy prosecute previously the action the named 6 satisfied is requirement 1 whether inquiries with other class proving that Defendants in 4 23 a 3 Legal named members and vigorously on behalf of Plaintiffs and Technical conduct violated the antitrust laws and 23 6 24 At the August concern regarding 25 27 is persuaded that Hariharan have an active active Panel antitrust T he people 2115 23 claims against combination 28 the Supplemental whether Hariharan Motion for Class Certification a former employee of Lucasfilm could the Court expressed the typicality satisfy requirement given that Lucasfilm recently reached a settlement agreement with Plaintiffs Court 26 8 hearing on claim against who worked the other conspiracy Antitrust Litig still satisfies the remaining members FR D 594 during the period of the conspiracy s members for the settled companies of the conspiracy are liable for 267 the typicality requirement because one A another s conspirator of the conspiracy because is See all of the No jointly liable for everything 11 CV 02509 LHK MOTION FOR CLASS CERTIFICATION to at of the TFT LCD existence ORDER GRANTING PLAINTIFFS SUPPLEMENTAL 8 Tr still have members see also In re 16 Case Aug during the class period conduct The he continues done Flat Case5 11 cv 02509 LHK 1 suppressed 2 interest 3 9 4 satisfies compensation their with class members 5 6 id Ex 10 5 56 the adequacy 23 a also 7 672 A class definition 8 administratively 9 Boeing California 12 Matthew to objective Bender 3d 13 Here sufficient for a 14 to the job 16 creative 17 economist and expert 18 proposed Technical 19 light if the description conflicts of 56 id Ex 8 319 23 a in Rule 56 id Ex Class is W Moore Moore s FRD at so that it is member O Connor v omitted internal citation determine that class members are included criteria 5 James a 274 enough definite an individual CD Cal 1998 have held that courts eg Herrera See of the class is court to ascertain whether or excluded Federal Practice addition In from the class 23.21 3 ed Plaintiffs proposed 15 District 86 the Court finds that the Plaintiffs proposed Technical FRD 311 184 Court of is feasible N Am Inc reference 56 id Ex 7 6 of do not have any implicitly requires that the class be ascertainable the court must be able to by Thus Ex Decl Shaver Plaintiffs to the four requirements explicitly provided In addition Rule 11 addition the named In Page17 requirement 6 10 Filed10 24 13 Document531 Leamer Report as Technical discussed above Class consists of the job See Leamer Rep App titles B identified in Dr Leamer Appendix selected B these District titles own employment based on Defendants compensation data which breaks jobs into States Northern United the For of technical and Defendants in compensation Rep 21 to include 22 period of time 23 Court finds that the class definition 24 24144 ECF No 417 to who 2009 Having undertaken a 25 certification 26 Plaintiffs proposed Technical 27 adequacy 28 ascertainable In addition within filled Thus No the in in the Technical F Hallock of Kevin Class companies Class in Hallock Plaintiffs within except Intuit 2007 to 2009 for Intuit a seek fixed Thus the analysis to determine whether the party seeking 23 Class satisfies Mazza 666 the numerosity satisfied F3d at 588 the Court finds that commonality typicality and Plaintiffs proposed Technical the requirements set forth by Rule 23 a 17 Case a labor ascertainable rigorous have the titles included the proposed Technical In addition the Court finds that Plaintiffs F Hallock Kevin for inclusion these job titles at Defendants for all Defendants is reviewed workers See Report has met the prerequisites of Rule requirements and design the titles selected job families for technical 20 2005 structure Class and confirmed only employees job families Id and development research 11 CV 02509 LHK ORDER GRANTING PLAINTIFFS SUPPLEMENTAL MOTION FOR CLASS CERTIFICATION Class is Case5 11 cv 02509 LHK 1 Further because the named Defendants conduct 3 any conflicts 4 Mark Fichtner Siddharth Hariharan of interest the Court 5 B 6 Plaintiffs 23 23 Rule b3 b3 Rule 8 does not 9 damages can be proven on below 11 California any individual 23 Rule in proving that interest and do not have Brandon Marshall and Daniel Stover Devine Michael to appoint as class representatives Predominance b3 s predominance basis a classwide Class satisfies the requirements of Defendants argue that Plaintiffs proposed class requirement because neither Opp n at 11 common the Court finds that questions Suppl Opp n at impact nor antitrust 34 For the reasons to the class are likely to predominate over questions The predominance 12 86 of compensation their Plaintiffs request Defendants disagree Specifically satisfy discussed GRANTS now also contend that their proposed Technical 7 10 laws and suppressed the antitrust Page18 and Class members share an Plaintiffs 2 violated Filed10 24 13 Document531 analysis focuses on that qualify each class the legal or factual questions Court of member s case 14 cohesive to warrant adjudication 15 Fed 16 District 13 or fact 17 members as a genuine controversy to determine whether proposed classes are sufficiently Amchen Prods 521 by representation US at 623 see also District R Civ P 23b3 holding that to certify a class the court must find that of law questions States common to class members predominate over any questions affecting only individual Northern United the For 18 added emphasis Considering whether questions common to class with the elements of the underlying causes of action 19 begins 20 Halliburton 21 which are subject 22 LCD Flat 23 Co 131 S Ct 2179 2184 to common Panel Antitrust In this case 24 US C 25 Class Cert 26 27 estimated In re 1 and Section Mot at measure New 1 4 of A court FRD at must allege a violation of Section establish an antitrust 2 an damages to Erica analyze members predominate P John these elements to individualized proof Act 15 claim 1 of the U SC plaintiffs Sherman New Motors 522 F3d 6 19 n18 Motor 1st No 15 See CAC Vehicles 119 135 typically must prove Canadian Export and 1a 3 an Antitrust Litigation Cir 2008 11 CV 02509 LHK ORDER GRANTING PLAINTIFFS SUPPLEMENTAL TFT Act 15 18 Case v determine In re Antitrust injury they suffered as a result of that violation In re Fund Inc 31113 of the Clayton Antitrust To laws 2011 proof and which are subject Litig 267 Plaintiffs violation of antitrust 28 of law or fact MOTION FOR CLASS CERTIFICATION Case5 11 cv 02509 LHK 1 Before the Court discusses 2 these elements 3 are not altogether 4 the standard 5 class action 6 Supreme Court 7 In 9 86 of predominate with regard to each of questions a the Court notes that the legal standards clear Specifically must apply court wage alleging authority Walmart the Court notes that there is suppression on must v Dukes the from resulting Supreme Court certification 11 2551 The Supreme 12 in a 13 claim Id The Supreme 14 15 relied 16 120 17 Id in could not demonstrate commonality rigorous common no binding issues rejected certification a Title VII case predominate 7 entail some a party holding that with the a in putative somewhat more than one seeking class S Ct at rule Dukes 131 court must engage district with the merits of the overlap discussing Further recent of a class of Court further noted that prior to certifying a class a analysis that will authority inquiry that the law in this area remains demonstrate his compliance affirmatively to the predominance violations antitrust class certification suggests Walmart employees million female with respect in determining whether 10 California common whether Page19 unsettled 8 Filed10 24 13 Document531 underlying plaintiff s Court of District Court held that the class could not be 23 a under Rule Id at because the certified 2554 57 The Dukes plaintiffs plaintiffs had District on evidence that statistical women were paid less anecdotal evidence of discrimination from States women and a sociologist who opined that there was a culture of sex stereotyping Walmart at Northern United the For 2549 The Supreme at Court found that this evidence was insufficient to establish commonality 18 7 19 In their initial opposition class actions antitrust 20 outside to Plaintiffs class certification alleging wage 21 22 23 aff d NDNY 25 26 Roebuck 3d 802 F issues v 3d Cir 2004 Reed 257 v impact of antitrust Corp Sun Chemical Advocate Health 210 Care In re the comprehensive the comprehensive In addition intervening the cases cited Northern issues See Weisfeld Albany Med Ctr No 06 765 2008 WL 2945993 Comp of Managerial Prof l Technical Emps Antitrust Litig WL 26115698 DN J May 27 2003 However these cases are inapposite 28 2008 because they lack since of Ill July No 02 2924 2003 theories motion Defendants pointed to a series agreement in which district courts horizontal the basis that individual over classwide FRD 136 DN J 2002 by 84 F App x 268 FRD 573 ND 2009 Fleischman v the instant case 24 on circuit denied class certification this and damages would predominate by suppression authority case Co 722 F3d 796 Cir 2012 record Amgen such as that predates This is the Seventh 7th Cir 2013 and Messner These two Seventh present in the instant record strongly supports by Defendants were decided District of Illinois 7th documentary documentary Circuit cases case Moreover has refined the predominance particularly true with respect Circuit s decisions v Northshore suggest in the Plaintiffs experts in Butler Univ that the Reed inquiry to v Reed a Sears HealthSystem 669 court construed requirement too stringently The Court further notes that other district courts wage suppression antitrust classes including one since the latest Supreme Court Merenda v VHS of Mich Inc No 06 15601 2013 5106520 Mich the predominance 27 have certified cases 28 See eg Sept 13 2013 Johnson Ariz July 14 2009 WL v Ariz Hosp Healthcare Ass n ED No 07 1292 2009 WL 19 Case No 11 CV 02509 LHK ORDER GRANTING PLAINTIFFS SUPPLEMENTAL MOTION FOR CLASS CERTIFICATION 5031334 D Case5 11 cv 02509 LHK demonstrated no general 1 because 2 managers 3 required 4 proceeding 5 it not just common 657 questions Dukes F3d 988 The of a class 7 consider 8 Circuit further concluded that 9 analysis requires courts but at district there is years after decided it Dukes 12 plaintiffs who 13 plaintiffs need not prove materiality 14 class certification stage 15 that 16 California that questions 17 merits in favor of the class 18 to adjudicate the 19 controversy fairly 20 inquiry into the merits 21 at 22 were not required to demonstrate that 23 element Id 24 certification were alleging corporate a battle direction common of store that commonality finding a Costco vacated answer in a classwide commonality held of the experts on court s district Id class certification issues to determine of the evidence persuasiveness Two when v a 86 of 2551 at court discussing Ellis and no to generate Id in Ellis Page20 Supreme Court the the capacity the underlying merits in addressing also the 11 Accordingly the Ninth Circuit 6 10 of discrimination the certification of the class reversed Applying policy Id at 2554 discretion Filed10 24 13 Document531 district courts 983 The must Ninth that at certification class certification rigorous not only admissibility of the experts statements presented Id at 982 Supreme Court the Amgen securities fraud in In but affirmed the certification of a class of Amgen the Supreme Court held that Court of District one of the elements of plaintiffs securities fraud claim at the rather the Supreme Court found that needed only demonstrate plaintiffs District common would predominate questions S Ct at 133 1191 Rule 23 b3 showing requires a States common to the class predominate not that those questions will be answered on the Northern United the For 25 the certification at case rather 2013 1196 Rule 28 court in after at 23 to prove that each reversed is metho to select the Id Therefore 1194 no common elemen t d 23 b3 certification ruling is not best suited to adjudication while class certification license to engage of questions may her claim Supreme Court damages and certified a class of in liability more than two more that plaintiffs respect to classwide v No class under Rule Comcast 23 b3 The subscribers 11 CV 02509 LHK ORDER GRANTING PLAINTIFFS SUPPLEMENTAL to each proof Behrend 133 20 Case some holistic Comcast Corp million require seeking class plaintiff is susceptible inquiry is of the in free ranging merits inquiries would predominate with does not require a original Rather the Amgen the a Rule Importantly the Supreme Court specified b3 however certification of a Comcast had the office of Rule 23 grants courts stage Id One month 27 it and efficiently alterations and emphasis in 26 Id As such MOTION FOR CLASS CERTIFICATION S Ct 1426 district who sought Case5 11 cv 02509 LHK 1 damages 2 four theories of antitrust 3 proven using 4 notwithstanding the fact that plaintiffs expert 5 isolate the 6 Court reversed 7 principles due to the disconnect 8 1433 The 9 certification for violations 10 11 California with Rule 13 23 14 of the damages Id However resulting from the one its liability case model Dukes District b3 required a claim Id rigorous at and a model but analysis and that Rule that did not at b3 23 b3 may require at consistent effect of the applied pursuant the Court stated Specifically Id the class damages case must be of the principles 23 class damages the theory of some to Rule be impact Id The Supreme need not be exact plaintiff s damages anticompetitive the Court suggested that pursuant a to the alleged Court of a of those theories could of class certification application damages supporting particularly with respect also applied one antitrust the theory of impact of Comcast had proposed court certified theory of 86 of in Plaintiffs damages using calculated credited c alculations Id Importantly the district straightforward between as at trial any 1431 at Page21 court found that only but the district evidence Court stated that 23 a in laws Id antitrust the certification under a stage violation 12 common of federal impact Filed10 24 13 Document531 to that Rule inquiry into the merits 143233 District The Ninth Circuit 15 in line with the Supreme Court s admonition that Comcast created no States 16 new law 17 There 18 alleged 19 Ninth Circuit 20 not defeat certification of a Rule 21 calculated 22 Comcast does read Comcast narrowly in Levya v Medline Industries F3d 510 716 Northern United the For the Ninth Circuit reversed violations law the fact that 23 calculations b3 not pose a barrier to 24 Cir 2013 25 individual 26 found that 27 damages a 51314 Thus lost due to Circuit in Butler alleging by each class liability so long as at Comcast inquiries does damages v Sears Roebuck defects in washing Co 727 F3d 796 machines held 789 The Seventh hearings to ORDER GRANTING PLAINTIFFS SUPPLEMENTAL MOTION FOR CLASS CERTIFICATION Circuit determine the Circuit distinguished 11 CV 02509 LHK 7th that The Seventh 21 No will be Id 28 Case under defendant s unlawful practices could be followed by individual member Id after require individualized with respect to damages do not defeat class certification a determination of sustained would class certification post Comcast consumer action questions Circuit held that even class Id at based on the wages each employee Echoing Levya the Seventh 23 laws The Ninth damages Cir 2013 court s denial of class certification in a case concerning a district of California labor 9th Comcast Case5 11 cv 02509 LHK 1 on 2 defendants that are not challenged on a class wide basis the basis that there is The Seventh 3 Univ no Filed10 24 13 Document531 damages could be possibility in this case that approvingly cited Circuit in Butler F3d 802 669 Page22 Id its at attributed previous decision Cir 2012 where 5 reversed 6 inquiry does not require the total absence 7 predominate 8 noted that for the purposes of predominance the inquiry focused on whether 9 predominate a denial of class certification over any individual the Seventh Id at those questions 11 certification 12 even rigorous application 13 Id 14 cases 15 both Messner 16 determined simply by counting 17 or Seventh 815 Moreover the Seventh on meritsand the of the class certification standard against stated common had questions Circuit in Messner common common could show plaintiffs Circuit Circuit held that the predominance Circuit further cautioned dress rehearsal for the trial the Seventh questions but rather that of individual questions Id at 819 The 10 California Messner questions not whether over individual into a In Messner v in Northshore 7th to acts of the 800 4 HealthSystem 86 of turning questions answers to class cases that in antitrust lead to certification will frequently Court of District at 811 815 see also Amchem consumer or alleging 521 US at 625 Predominance securities fraud or violations is a test readily laws of the antitrust met in certain Importantly in District and Butler the Seventh Circuit rejected the proposition that predominance is States noses that is determining whether there are more common issues Northern United the For 18 more issues regardless of relative importance individual too requires a qualitative assessment predominance F3d 19 Messner 669 20 The Seventh 21 22 post Comcast 23 Litigation 24 class finding 25 common 26 Amgen the 27 Id 28 class certified at F3d Butler 6th Cir 2013 838 counting cited and There in the at 801 Id see Rather also damages purposes consumer class in addition for evaluating in accord with the Sixth Circuit s Products Liability the certification of a considered the merits in determining that individual Sixth Circuit further distinguished for was test the Sixth Circuit affirmed court had adequately liability or mechanical Corp Front Loading Washer would predominate over defendant s 859 The in in In re Whirlpool that the district questions is Circuit decision decision 722 There no mathematical not bean F3d predominance at 814 is it Butler 727 questions The Sixth Circuit found that like action would be classwide Comcast on the basis that to liability purposes or non existent Comcast concerned Id Accordingly 22 Case No 11 CV 02509 LHK ORDER GRANTING PLAINTIFFS SUPPLEMENTAL MOTION FOR CLASS CERTIFICATION the Sixth a Case5 11 cv 02509 LHK 1 Circuit concluded 2 satisfy Rule 3 law or 4 individual 23 that common fact to members DC Id 6 and Seventh 7 scrutinize 8 classwide basis 9 Cir 2013 The 10 there exists no 11 further stated 12 show and before granting certification Circuits and concluded Circuit held that means i t is over any questions on include that to that questions of that affect only Fuel Surcharge indisputably Id at injury in DC to fact Id at can be proven on a F3d 244 25253 where DC Circuit the evidence i found that DC 247 The court to scrutinize Circuit therefore the Sixth closely of fact cannot predominate the role of the district 253 The courts 725 Antitrust Litig c ommon questions of proving classwide now by the qualitative assessment required reports that demonstrate that impact See In re Rail Freight that must find that such an assessment requires district factual evidence and expert reliable courts 86 of Corp and Comcast district of the class predominate Circuit has further elaborated DC Amgen Page23 860 at The glean from must plaintiffs members 5 California we the principles b3 named Filed10 24 13 Document531 t is now clear Court of 13 that Rule 23 not only authorizes 14 show predominance 15 district 16 District plaintiffs expert the rule a hard look at the soundness it commands Id at 255 of statistical Accordingly the models DC that purport to Circuit vacated the District court s certification of the class because there were methodological problems with the States reports that the district court had not considered Id at 252.8 Northern United the For 17 18 8 19 The First and Third Circuits 20 21 F issues 22 8 In at Court s through conclusion if the fact of antitrust common proof 24 133 S Ct in Amgen 1191 at emphasis and In re Hydrogen Peroxide 25 In re Circuit held that 27 that Rule same 23 3 311 b elemen t in original of a district methodology Court authority Id a district F3d This appears to at does not require a her claim Nevertheless that it 20 intends impact cannot be Hydrogen Supreme plaintiff seeking class is susceptible to classwide proof some of the theories in In re New Motors Amgen Specifically conflicts in expert to use common evidence No the opinions that go to is insufficient F for 552 3d at 32123 Similarly the First court should have engaged in a searching inquiry into the validity of a of impact In re New Motors 522 F3d at 27 Accordingly the First Antitrust Litig court should have addressed criticisms of the plaintiffs expert s In light of the fact that these theories appear to be consistent with the Court applies them in the instant action 23 Case courts see also In re conflict with the Antitrust Litigation are consonant with Hydrogen Peroxide novel and complex theory Circuit found that 28 at and that a party s indication certification district based in part on violation and the fact of antitrust New Motors 522 Third Circuit held that a rigorous analysis required resolving certification 26 In re F3d to prove that each certification cases vacated for reconsideration F not predominate established b3 and remanded Supreme Court authority See In re New Motors Hydrogen Peroxide Antitrust Litig 552 3d 305 307 3d Cir 2008 For and Third Circuits relied on a theory that in antitrust class actions common Peroxide Antitrust Litig 552 23 23 re the First do preDukes Amgen and Comcast been superseded by intervening theories that have 522 3d example in of classes under Rule certification 11 CV 02509 LHK ORDER GRANTING PLAINTIFFS SUPPLEMENTAL MOTION FOR CLASS CERTIFICATION Supreme Case5 11 cv 02509 LHK 1 Certain principles 2 whether the Technical 3 circuit 4 question 5 questions 6 evidence and 7 action 8 Comcast 9 cannot require regarding S Ct Amgen 133 common Id Second Corp 1191 at First common whether questions In essence Plaintiffs to prove elements of 11 evidence that forms the basis of the methodology 12 predominate 13 evidence 14 also In re Rail Freight 15 inquiry is not a mechanical 16 California Amgen 133 individual 17 contemplates a qualitative assessment which includes 18 models 19 are not required 20 classwide proof Amgen 133 S Ct 21 will predominate with respect to their case as a 1194 Third Ellis 657 F3d at this and the the critical over individual common whether rigorous analysis a with the merits but the inquiry case at the class certification stage substantive 10 at predominate must conduct may overlap their determining prove the elements of the underlying cause of this question this Court S Ct at 1432 This analysis in Amgen Comcast this Court must determine to 86 and most importantly authority could be used methodology in answering 133 S Ct is of must apply emerge from Walmart certified Supreme Court that this Court must answer Page24 that this Court the legal standard Class should be court cases applying this Filed10 24 13 Document531 Court must determine not only the admissibility of expert that demonstrates 982 Rather this Court must common whether also determine questions whether that expert Court of District is persuasive which may require the Court to resolve Fuel Surcharge Antitrust Litig 725 Id methodological disputes F3d at 255 Fourth see the predominance District inquiry of bean counting to determine whether there are more States questions common than questions Butler 727 Northern United the For Id With 22 show questions 24 801 Instead the inquiry a hard look at the soundness F3d at 255 that each element of the underlying cause of action these principles 23 at Fuel Surcharge Antitrust Litig 725 In re Rail Freight to F3d in at 1196 Rather they need of statistical Fifth Plaintiffs susceptible is only show that to common questions whole Id mind this Court now turns to the elements and finds elementsantitrust that common impact and damages predominate overall 1 25 26 Plaintiffs and with regard to all three violation antitrust Antitrust Violation allege that Defendants engaged in an overarching conspiracy to eliminate 27 competition among one another for skilled labor with the intent and effect of suppressing the 28 compensation and mobility of Defendants employees CAC 1 2 55 Accordingly 24 Case No 11 CV 02509 LHK ORDER GRANTING PLAINTIFFS SUPPLEMENTAL MOTION FOR CLASS CERTIFICATION Plaintiffs Case5 11 cv 02509 LHK p roving 1 contend that 2 every Class Member 3 forth copious 4 transcripts and email exchanges 5 and senior managers 6 express trial Defendants Class Cert common all on common 9 antitrust legal violation 10 motion 11 that Plaintiffs 12 turn As at and support In support of their allegations this Court s April have demonstrated that common on overwhelmingly Defendants Tr issues See Jan 17 factual in of common issue for have Plaintiffs work documents internal CEOs as 86 of deposition well as other directors that Defendants alleged 17 1 4 at antitrust Do Court Defendants Counsel officers entered into Not violations you will turn contest the for purposes of this 5 Class Certification Order this Court agrees and adjudication of Defendants alleged finds violation will antitrust issues Apr 5 Class Cert Order legal and factual set employees for one another s that adjudication Page25 will be the overriding Plaintiffs allegations prong of the analysis stated 2 Defendants between of which Defendants concede 8 Mot conspiracy evidence in the form of Defendants agreements not to compete 7 California at Filed10 24 13 Document531 13 at Court of To 13 prevail on 1 there 14 must show that 15 entities 16 District a cause of action reason analysis and 17 Corp for violation of Section was an agreement conspiracy 1 of the Sherman Act a or combination between two plaintiff or more District 2 the agreement was an unreasonable of trade under either a per se or rule of restraint States 3 the Northern United the For F3d 781 9th Cir 2001 18 19 92 all 784 20 9th affected Cir 1996 here present Plaintiffs of that evidence is restraint common to Class as a Plaintiffs evidence indicates that the roots of mid1980s 21 to the 22 sold Lucasfilm s CoFounder 23 24 Decl 25 because 27 explained 28 9 The Lucas computer division a of Lisa Cisneros believed it s I George tech not Cisneros a normal alwaysthe we had third factor whether the alleged and development Apple who Lucas violations situation affected No Id down interstate at CEO Steve Jobs Pixar 16 59 ECF No 418 2 each other for employees at 52 for As George Lucas everybody was commerce is that we not disputed 11 CV 02509 LHK ORDER GRANTING PLAINTIFFS SUPPLEMENTAL and reach back to company to 25 Case 1059 1062 then renamed the division Depo or the rule that I put restraint antitrust v GTE whole should not compete against industrial competitive rule S Cal 252 F3d Defendants conspiracy appear research Decl Ex NN that companies of Inc former Lucasfilm Chairman of the Board and FormerChairman FormerCEO of George Lucas 26 shortly after Univ evidence of Defendants substantial the Technical v Tanaka see also Am Ad Mgmt commerce9 interstate MOTION FOR CLASS CERTIFICATION Case5 11 cv 02509 LHK Filed10 24 13 Document531 1 cannot get into a bidding 2 of 3 independent Pixar would reciprocate 4 agreed 5 to an employee 6 initiative 7 counter offer by the employee s current employer 8 3 McAdams 9 No 10 war with thing Id at 44 Edward 1 not to cold 168 Depo any at this non compete company even offer from the other via cold CoFounder Steve Jobs for a job Am Ans to that the newly The companies on in own response to a Decl Shaver Am Compl would thus an offer his or her Pixar Consol that they for that sort when making each other applied understanding not actively Ex 59 ECF solicit calling FormerChairman FormerCEO of employee force proceeded adamant about 13 to include 14 such beginning no employment 16 employee applied independently 17 Vice President Advanced Technology 18 offer to an Apple 19 Resources 20 formalized the two companies understanding 21 between 22 phone 23 with Apple that 24 Apple employee 25 team to follow the same procedure his George Lucas whether Lucasfilm or Ltd s Lucasfilm 12 protecting the margins final and would not be improved 15 California 2 to notify 86 of rule with Lucasfilm that employee if would be 14546 Def don t have Pixar President agreed with Lucasfilm and Pixar had a general candidates 11 3 that Catmull we because each other s employees call of the other and other companies Page26 to Apple who expand was very the Pixar Lucasfilm agreement Court of District Apple and its later Cisneros Decl labor competitors than 2004 Ex RR Catmull Depo at 195 As Pixar sought Steve Jobs permission before making offers of District Apple employees to regardless of whether Pixar solicited the employee or the States Decl Ex 62 See Shaver showing email from Rob Cook Pixar Northern United the For 26 27 28 of employee On April and Administration and Pixar and Lucasfilm call with Danielle is See to Steve Jobs in 30 2007 Lambert and that similar to our Lucasfilm including outside on 66 the Lori same terms recruiters if emphasis we use them Intuit assisted Steve Jobs Board of Directors CoFounder No Co Lead as the gentlemen s follow a gentleman s we won t agreement Danielle agreement directly solicit any will ask her Recruiting Director On of February Apple 18 2005 and advisor FormerChairman FormerCEO of Apple Bill Campbell to Google in entering into an 11 CV 02509 LHK ORDER GRANTING PLAINTIFFS SUPPLEMENTAL Human Human Resources 26 Case of added These agreements extended to other Defendants Chairman of is of President make an informing recruiting team about her now we ll agreement That permission to Pixar Vice Apple Head McAdams effective requesting McAdams Lambert Danielle id Ex Lori 2004 MOTION FOR CLASS CERTIFICATION Case5 11 cv 02509 LHK 1 agreement with Eric Schmidt 2 former 3 Jobs that Eric Schmidt 4 Apple 5 p lease CEO at Google Danielle add Google to your you hear 6 so 7 sure to honor our side of the 8 Recruiting 9 Apple which had if 27 Google s senior executives 12 Google hands off list We deal Id Ex 23 was including us please Later that year Do be sure to and of Directors anyone from ordered her from one Not Cold Call list to compete for me know of Google staff to another Please be Google companies employees See Management Group former Google let Arnnon Geshuri Schmidt Larry Page Eric and Shona Brown Human Resources recently agreed not to recruit to Google s Executive presented CoFounder of agreements with Google not special 11 California Lambert Apple Head Director was asked to create a formal draft Board email from Bill Campbell to Steve Jobs informing Steve of any recruiting they are doing against 10 The of the 86 of got directly involved and firmly stopped all efforts to recruit day That same Page27 Google Executive Chairman Member id Ex 17 See Filed10 24 13 Document531 a committee including id Ex consisting CoFounder of Sergey Brin Senior Vice President Business Court of id Ex 28 Operations See 14 stating 15 concerns with sharing 16 District 13 Schmidt responded that he preferred that 17 paper 18 to this looks very Eric Schmidt good When approved id email from the list See Shona Brown asked Eric Schmidt Eric Schmidt whether he had any District information regarding Do the Not Call list with Google s competitors Eric States it be shared verbally since I don t want to create a Northern United the For do trail orally i Two 19 we over which can be sued later Id Ex 41 months entering after into an agreement with Google Steve Jobs Chairman Former CEO of Apple persuaded Adobe 21 Apple 22 Adobe was 23 thought 24 way 25 by 26 they are free to approach 27 understanding 28 NOT On May 26 2005 Open recruiting Steve Jobs complained Apple employees to discuss to would be good It to Bruce Chizen Id Ex 18 send Apple recruiters solicit after I from either CEO that is would propose we keep OK not a Sr Director I ll tell or VP Am No company If you I d that rather agree are in agreement I will let 11 CV 02509 LHK ORDER GRANTING PLAINTIFFS SUPPLEMENTAL it I 27 Case I our recruiters that correctly Id Bruce Chizen immediately gave in any employee Former Steve Jobs was not satisfied and replied Adobe s employees who former Adobe Bruce Chizen responded by saying agree Id any Adobe employee your position to actively to CoFounder to enter into a nearly identical agreement with agreed not to recruit any senior level employees threatening makes sense agree Id 20 we Shona Brown responded MOTION FOR CLASS CERTIFICATION Case5 11 cv 02509 LHK 1 my folks know 2 President 3 agreement that 4 in original 5 Adobe employees not 6 7 Id we announced In addition cold to to Google s no poaching policy with 8 Member 9 an unofficial no poaching policy of the Google Board 10 11 California Member to Paul Otellini in which 12 Intel of the has been Board Google with and former wrote Eric Schmidt the Do Not Adobe Vice Bruce and Steve Jobs have an Id Ex versa 19 emphasis that are off limits list which instructed Id Ex 11 51 email from Paul of Directors to Intel of Directors on listed eg id Ex See 86 agreement with Apple Google also entered anti solicitation Intel of Theresa Townsley team c ompanies its Apple employees call Page28 Apple employees and vice placed Apple on then day next to her recruiting ANY are not to solicit Adobe The emphasis in original Human Resources Filed10 24 13 Document531 recruiter dated April checked CEO of 16 2007 this policy in have I No was created 4 2007 email a June as to our recruiting policy Call List since the policy and Intel stating a Google Executive Chairman Eric Schmidt CEO confirmed I Otellini into with Intel one in staffing Court of networks directly calls 14 Hopefully there are no exceptions 15 know immediately 16 District 13 Director 17 reflected company or emails into the and to this policy looking for talent or its subsidiaries if you become aware of this please let me District Id Ex 56 Chairman of Bill Campbell Board Intuit of Directors Co Lead States Apple and of advisor Google was to Google also involved in the Intel agreement as Northern United the For 18 in an email exchange Google Advisor to Google should from 2006 the Office of CEO and 19 that 20 whether the 21 the email to Patricia 22 former President 23 later in an email entitled 24 Otellini and another 25 prohibits us from recruiting Google s 26 clarify 27 would not 28 Google We Intel employee first approached of Murray Human Intel Bill Campbell making an Google Resources with a note global signed See Are either senior We later of stating Intel of regardless of of Leadership not fwd Intel Strategy DOJ No eric and alleged Let that me myself I that the other evidence suggests 11 CV 02509 LHK ORDER GRANTING PLAINTIFFS SUPPLEMENTAL days Google Paul Otellini replied between and recruiter asked Paul 28 Case Two Id of any agreement with recruit 2007 Management Paul Otellini then forwarded note that while the than September employee Google an Id Ex 52 no of Product Do FYI you aware talent Plaintiffs an and Director have a handshake Id agreed with Jonathan Rosenberg id Ex 37 gentleman agreement with known agreement began no offer to Senior Vice President senior executive have nothing which former Senior Vice President call Paul Otellini before like this broadly Intel in MOTION FOR CLASS CERTIFICATION that the Case5 11 cv 02509 LHK 1 2 agreement began showing Intel 2005 in agreed with Pixar that 4 Defendants as other Not Call list as early as Page29 agreements bilateral 2005 86 of In October of id Ex 28 See 2008 also Intel forward Decl Ex 70 5 Bill 6 advisor 7 9 also insisted non solicit Campbell June Campbell Chairman of Google to requested Executive 11 2007 12 include 13 ECF No 14 was broadened was added Intuit not cover be added fully to the Google ed Do only 18 Not call see also Decl id of Intuit Ex 30 employees and Bill 31 email dated Google CEO Thus by June DNC please update the Dean Harvey Shaver agreement Id Ex Call list Apple of Director and Eric Schmidt Recruiting Id Ex 26 Director non compete of the Board of Directors and former fully to the list 100 do Intuit enter into a Intuit initially Arnnon Geshuri Chairman Member 10 Google and policy CoLead Board of Directors Intuit that that Intuit 6 2007 between pursue any Pixar employees going will not proactively it Google s Although 8 California Do on Google s 3 same time the Filed10 24 13 Document531 Harvey list 12 now to Decl Ex 25 at 13 Court of District 248 stating that 2007 in June Do Google s to include Not Cold Call policy for Intuit began in April 2006 and employees all Intuit District Ultimately by the time that the 15 DOJ began investigation the in summer of 2009 Apple s States Do own Hands Off 17 Jobs CoFounder 18 enter into a similar agreement with 19 employees 20 Colligan 21 Apple by which 22 employees Decl 23 threatened 24 not agree 25 patents 26 agree that neither company will hire the other s employees regardless of the individual s desires 27 not only 28 people Not List Decl Ex 22 16 Call included every Defendant See Shaver Steve Northern United the For moved FormerChairman and Former CEO of Apple to neither of retaliate two companies and CEO of Palm to company would Edward against Palm wrong who elect it Colligan is if propose Colligan Palm resisted Palm could nevertheless likely illegal August hire the other s Colligan to such an arrangement Edward On the between former President Palm following Palm Inc a period in which 22 2007 Decl including 6 ECF No Mr Id 293 at Palm alleging Colligan the right to Palm and high tech Steve Jobs also Jobs also suggested that stated your proposal further I can t No 11 CV 02509 LHK ORDER GRANTING PLAINTIFFS SUPPLEMENTAL Palm MOTION FOR CLASS CERTIFICATION did many that deny do so simply because they now 29 Case if infringement of Apple s refused writing to Steve Jobs Edward several Steve Jobs called Edward an arrangement between employees face lawsuits Id Ex A to pursue their livelihood also tried unsuccessfully to we is Case5 11 cv 02509 LHK 1 work 2 Colligan 3 intimidated 4 based on 5 Page30 of 86 wouldn t want you to do that to current Palm employees responded for 6 Apple and Filed10 24 13 Document531 by your Palm s sure is If you you choose assets but patent realize the when money final threat We say advice is stating litigation We want to be clear that route is the are not can respond with our claims answer end up paying at our patent we Id Edward Id Steve Jobs I m to stop this of our respective the financial resources a look we must do whatever we can will both just to take I the litigation don t think asymmetry in you My I to Apple not satisfactory companies 8 Steve Jobs threats held firm against This 7 I a lot of lawyers a lot of portfolio before you make a on an anti solicitation agreement here decision 9 B 10 11 California Id Ex regarding 12 Edward Colligan his proposal Id did not agree and did not communicate with Steve Jobs further 8 Defendants generally structured their agreements with each other to apply to all employees Court of regardless of job 14 recruit 15 subsidiaries 16 District 13 from either 17 employees id Ex 66 18 Harvey 19 However Defendants Apple and 20 from each other rather 21 Decl Ex 17 in original type department anyone from or Apple id Ex geography See Shaver 56 Google would network not call Google would not or email into Intel or its District looking for talent id Ex 19 Apple and Adobe agreed any employee not to solicit States Northern United the For 22 company id Ex 60 Decl Ex 25 Plaintiffs DOJ at Pixar agreed not to Do 13 Google s Intel than to avoid Not Cold the 24 reached 25 to the detriment 26 informationand access 27 Dep t of Just 28 of Just investigating anti solicitation Defendants facially anticompetitive of the affected to employees Compl Against eliminated who were Lucasfilm al DOJ DOJ Adobe Lucasfilm Shaver the a Order at Compl Compl esp technical away Decl Ex 55 concluded significant form No 112 by important see also 2 14 ECF No 93 1 Dep t 2 15 22 ECF No 93 4 11 CV 02509 LHK ORDER GRANTING PLAINTIFFS SUPPLEMENTAL revealed of competition of competitively 3 4 CAC emphasis that Defendants 30 Case also employees all Intuit for years until DOJ likely deprived MTD d went on each other s employee see hire top talent efforts conspiracy alleged better job opportunities et to conspiracy agreements that Compl Against Adobe NOT solicit include Call policy agreed simply all not to any Apple directly solicit maintain that Defendants alleged 23 After Lucasfilm and Pixar agreed MOTION FOR CLASS CERTIFICATION The Case5 11 cv 02509 LHK 1 2 DOJ 3 effort and 4 Adobe 5 Defendants entered 6 antitrust 7 government 8 compensation Lucasfilm Compl 17 CAC were into agreements that only obtained injunctive relief by for employees injured alleged Class 12 alleged violation will turn antitrust Accordingly on of trade that were collaboration the Defendants the allegedly by collusive common the Court finds that issues questions concluded that per se unlawful under the 112 However did not obtain the any activities suggests Plaintiffs legal and factual It DOJ the labor setting 3 CAC Compl Lucasfilm from in 112 The DOJ restraints 35 DOJ laws DOJ Adobe Compl This substantial evidence presented 11 California price setting mechanisms that apply disrupted the normal Compl 16 DOJ 10 86 of than reasonably necessary for the formation or implementation of any collaborative broader 9 Page31 were not ancillary to any legitimate also determined that the agreements were Filed10 24 13 Document531 that adjudication that are common will predominate Defendants of the Technical to with respect to the violation antitrust Court of District 2 13 Antitrust Impact Having found 14 that common will predominate questions with respect the first to element District 15 antitrust 16 referred to as antitrust 17 laws 18 antitrust the Court violation now turns to the second element impact impactalso Antitrust States injury is the fact of damage that results from a violation of the antitrust Northern United the For 19 In re DRAM violation Plaintiffs Antitrust Litig and the 2006 WL 1530166 at damages sought by plaintiffs marshal substantial modeling economic evidence including 7 In re It is New Motors 522 documentary 20 using 21 predominate 22 Court finds that the documentary 23 business 24 could be used to demonstrate the impact of Defendants actions 25 Accordingly 26 link between the causal F3d at 19 evidence and expert common the n18 reports standard 27 28 statistical over individual practices and questions the market in determining the impact evidence and expert in which of the antitrust reports paint a picture Defendants operate that suggests on Technical the Court finds that Plaintiffs proposed methodology Specifically have received theory and data to demonstrate that cold the record suggests calls but for that all technical the anti solicitation satisfies employees agreementsmay questions violations No that common proof Class members the predominance not just those who would have been impacted by the 11 CV 02509 LHK ORDER GRANTING PLAINTIFFS SUPPLEMENTAL The of Defendants 31 Case will MOTION FOR CLASS CERTIFICATION Case5 11 cv 02509 LHK 1 agreements 2 has the effect of spreading information 3 employees of another 4 employees within a firmand 5 across 6 Leamer the labor market Further relationship 9 equity to tool that Defendants a recruitment 71 76 Rep 86 viewed Such informationcould then spread beyond leading to widespread increases to information access contend that Defendants had in all other 10 firms Id Because 11 cold 12 have also affected 13 in individual 14 Each Defendant s 15 Defendants of groups Suppl a Mot at 15 22 desire to maintain equity placed on the salaries of individual other employees favorably to other employee compensation Id company wide compensation structures In addition Defendants the idea that similarly situated employees should be compensated calls of employees into job groups levels and families that were evaluated which organized 8 Page32 about salaries and benefits from recruiters of one firm to due to increased Plaintiffs 7 California note that cold calling Plaintiffs Filed10 24 13 Document531 between employees who were part of the employees who would same the and paid in valued internal similarlywithin upward pressure have received that would the calls As such salary structure their variances Court of District employees salaries would other employees affect who were in a similar position by compensation structure could then have been influenced the other District structures as Defendants saw each other as competitors for the same labor pool States 16 Finally Plaintiffs point to the fact that Defendants were motivated to retain their Northern United the For 17 employees This 18 incentives 19 20 Plaintiffs contend would have motivated each Defendant to employees to respond to and to prevent 105 Yet 21 Ultimately the Court on 22 prevail 23 sufficiently 24 impact The Court 25 data and expert 26 likely to predominate 27 evidence these theories benefitted is Rather the at this question reliable theory to demonstrate that finds that based statistical is phase with determining whether narrower whether common the extensive Plaintiffs theory of initiate Plaintiffs first evidence a economic theory demonstrates that discusses common impact and common the substantial then proceeds to 11 CV 02509 LHK ORDER GRANTING PLAINTIFFS SUPPLEMENTAL will have presented 32 No such Plaintiffs 28 Case Rep evidence can be used to demonstrate documentary issues The Court Leamer Class modeling Plaintiffs methodology over individual which supports on Defendants did not need to the entire Technical not tasked provide financial poaching by other Defendants because of the antisolicitation agreements measures which would have to MOTION FOR CLASS CERTIFICATION issues are documentary discuss the Case5 11 cv 02509 LHK Filed10 24 13 Document531 The Court concludes by rejecting 1 expert 2 Page33 86 of flaws that would undermine Plaintiffs entire methodology reports Defendants attempt to identify 3 a 4 5 Documentary Evidence Motion In Plaintiffs Supplemental documents for Class Certification common evidence 6 pages of 7 and undermine 8 evidence suggests that for the purpose of ultimately proving impact 9 predominate all many of the representations over individual The Court begins by 10 and as a recruitment 12 whole 13 importance 14 Defendants viewed Defendants wage suppression depressing The Court then made by Defendants previously the documentary discussing 15 California Plaintiffs theories of classwide common Plaintiffs common issues harm will ones 11 tool which support submitted thousands of Plaintiffs Defendants the evidence of on of cold calling the effect of the preclusion discusses evidence on the importance the Technical compensation rigid of cold calling Class as a structure and Court of District The Court of internal equity turns to the documentary finally may have each other as labor competitors which evidence that resulted in individual District employees wages other Defendants States i 16 Cold Calling and Recruitment Northern United the For 17 Plaintiffs produce significant evidence that cold calling was an important part of 18 Defendants 19 cold calling had adverse recruitment and contend that the elimination practices effects on a 20 through Class members Technical all of such recruitment The Importance of Cold Calling as a Recruitment Practice to Defendants 21 Plaintiffs documents support the allegation that throughout the class period Defendants 22 viewed recruitment particularly of passive candidates who that is employees were not actively 23 looking for a new jobas crucial and development to their growth Donna Morris AdobeAdobe 24 Senior Vice President Global Human Resources described recruiting talent as critical to 25 company growth Harvey Decl Ex 1 Morris Depo at 56 17 19 26 important to 27 intellectual Adobe A So our property based critical most company critical Adobe asset is Q Why people So also believed is recruiting talent really we re that an important way 28 33 Case No 11 CV 02509 LHK ORDER GRANTING PLAINTIFFS SUPPLEMENTAL MOTION FOR CLASS CERTIFICATION an to source Case5 11 cv 02509 LHK 1 top talent was to focus on may be 2 entrenched 3 14 4 looking for 5 their 6 rapid 7 Google employed 8 agencies 9 increasingly 10 3 at passive Adobe willing to listen And so recruiting included as hiring many id Ex 25 as at 800 a is it defined as Adobe that big big aspect is Id a larger role in recruiting as is who tend to be Decl Ex presented Shaver might not necessarily be company where 57 13 17 at 86 To they can leverage Google s support 2009 thousand employees per year from 2006 to several Google of top performers often the very best candidates recruiters while also working 78 Page34 the right opportunity if They might not even know growth which See which talent As explained by Donna Morris capabilities also determined we move with external recruiting p assive that will play an sourcing company key method Decl Ex Harvey Suppl calling as a forward as a 14 Google 2006 Sourcing Diagnostic The 11 California but Filed10 24 13 Document531 employees 12 potential 13 and research viewed also indicates that Defendants record Intel estimated cold to attract that historically competitive sourcing including cold calling Court of District 14 accounted Complete Guide to for Sourcing that Cold Decl Ex 27 Harvey of hires percent Calling candidates is and stated in one of the most its and efficient District ways Decl Ex 54 15 effective 16 were the largest source of hires 17 yield Harvey Suppl Decl 18 Google s Chief Culture Officer stated 19 expected unless they re on our don t call to Shaver recruit Similarly Google found that although referrals States and agencies passively sourced candidates offer ed the highest Northern United the For 20 Consequently c old that in response to concerns over slow calling into companies list Shaver Decl employees for positions 22 solicitation agreement with 23 engineering hiring 24 drain competitors within the Technical rate Cisneros Decl to accomplish this Relatedly 27 hiring when plan was a Senior Apple finding hiring documenting Executive that Ex 1753 Thus rate of stated a in recruit is to be about their ability it Google Id see large 2007 needed to also hiring dramatically stated it would gap challenge former Apple Director in need to Ex 14 the EE of Executive 11 CV 02509 LHK ORDER GRANTING PLAINTIFFS SUPPLEMENTAL the for engineering positions 34 No recruit increase Harvey Suppl Decl that his biggest high quality people Mark Bentley that 28 Case to For example shortly prior to Google s anti Apple Google determined Google 2006 Sourcing Diagnostic 26 Class to hiring Ex 42 Further Defendants appear to have been particularly concerned 21 25 Ex 14 MOTION FOR CLASS CERTIFICATION Case5 11 cv 02509 LHK Human 1 Recruiting 2 need to do more targeted and Interim Google 3 4 decline 6 Shaver 7 leaving 8 for the highest tracked the decline Decl Ex Google 45 documenting portion of overall a to Bottom at Ex 7 Google s offer that candidates top technical see also who employees of technical we as well as the candidates 1 showing line is that reported and that Facebook accounted startup organization departures b Enforcement AntiSolicitation Agreements of the by Defendants 10 While Defendants 11 12 Ex 173 how during 2010 9 California rate of its top technical among senior and company went for another 86 of candidates Harvey Suppl Decl passive especially rates Page35 Director responded by stating employees See Cisneros Decl loss of its technical 5 Resources recruiting of also closely Filed10 24 13 Document531 dispute that this absence agreements had any effect on job opportunities due of cold calling to their anti solicitation or flow of information to the class memberssee Court of District 13 14 Opp n 17 at Defendants own documents created during the alleged conspiracy tell a different story District First Plaintiffs 15 that but for Defendants anti solicitation offer evidence indicating States 16 agreements Defendants would have been cold calling one another s employees For example in Northern United the For 17 18 19 20 21 22 23 24 25 26 27 November of 2005 Howard Look to find candidates but Adobe personnel recognized former Pixar Vice President that struggling recruiting Adobe knew but CEO and talent Shaver Director of of course cannot recruit CEO Steve advisor to and above 30 Thus by because that Apple to was what I objected Z stated Shaver that Pixar was Bruce of Intuit to Chizen poach and calling to everybody that was a Cisneros Decl agreements Defendants Ex EE CoLead midlevel Campbell Depo at employees were deprived of and opportunities 11 CV 02509 LHK ORDER GRANTING PLAINTIFFS SUPPLEMENTAL each other s at his deposition anti solicitation agreements 35 No former Board of Directors 28 Case Ex 64 Decl look into for the purpose of u nfortunately Chairman explained A through virtue of these anti solicitation job information so Software Jobs have a gentleman s agreement not Google prevented a competitor from going engineer do Decl Ex 13 As Bill Campbell Apple and out of Apple would be a great target that they could not Apple of MOTION FOR CLASS CERTIFICATION Case5 11 cv 02509 LHK Second 1 the evidence indicates that Defendants 2 anti solicitation agreements 3 Arnnon Geshuri 4 Member 5 President 6 following the 7 the 8 agreement with Pixar in a document 9 emailing or enticing Google Board of the Do of Directors Not Call policy or its subsidiaries 11 Corporate Vice President Plaintiffs regarding looking any way in employee applies 12 and former CEO and We which states O by CEO of the Google Senior Vice Google ur Decl Ex 35 cannot recruiters are strictly including recruit Pixar for approval to If former its up calling for Intel Pat Geslinger Intel or emailed into memorialized Intel come to work current Pixar employees to will contact an email from In Google Executive Chairman Laszlo Bock talent Shaver without being recruited to Intel enforced these and no one has called networked Intel for 86 of harmful effects their Director to Eric Schmidt Recruiting 10 California which further demonstrates Page36 and aggressively actively Operations Arnnon Geshuri confirmed of People company Filed10 24 13 Document531 a Pixar Intel Senior Id Ex 53 hire Defendants agreements were also offer evidence supporting their assertion that Court of particularly concerned 14 Steve Jobs 15 CEOs of co Defendants to thwart the recruitment 16 District 13 recruiter from Google s engineering team contacted 17 forwarded 18 Directors and former 19 would 20 recruiter and 21 was 22 from Bill Campbell 23 advisor to 24 pissed that 25 to Eric 26 recruiting in our iPod with preventing CoFounder the recruitment of one another s employees technical FormerChairman and FormerCEO of Apple repeatedly contacted the District of Apple s employees For instance when a States an Apple employee in 2007 Steve Jobs Northern United the For Eric Schmidt to CEO and this I would be very future Chairman occurrences of Intuit to Sergey Brin prevent I am ing Decl Ex 24 If Id see Co Founder Google told that Googles group hour if your recruiting department public example out of the Id The aim of this public spectacle a Decl Ex 1869 Co Lead of stating guy Shaver Director future occurrences you of Google s Decl Ex 25 put a stop to recruitment Apple employees were deprived of learning Apple Steve just called sic new cell phone software this is indeed true can of the Board of also Cisneros Board of Directors are still recruiting his browser Schmidt pleased Google responded by making terminat ing the recruiter within the Google we Google Executive Chairman Member stated Id Ex 24 hopefully prevent By Shaver message stop doing to 27 28 the of No and is email from Steve Jobs group is relentlessly it Apple employees about potential see job opportunities 11 CV 02509 LHK ORDER GRANTING PLAINTIFFS SUPPLEMENTAL and me again 36 Case email MOTION FOR CLASS CERTIFICATION Case5 11 cv 02509 LHK Google from more than 800 Google 1 at 2 See Harvey 3 engineers 4 guys 5 Decl Ex 25 Steve Jobs after Cisneros Decl personally 7 applied 8 CEO of members 9 regarding and Intel am their of the Technical Member 10 57 11 know 12 Chairman Member 13 Id 14 Eric Schmidt 15 Otellini 16 California that he d also Cisneros Dec 17 bother you again on 18 Page37 of 86 well as Google s external recruiting agencies declined strongly to hire some former Apple Google prefer that not hire these Ex 653 of the Google s successful Paul known be it as Google even In fact and enforced monitored to let recruiters offer further evidence supporting Plaintiffs 6 78 at Filed10 24 13 Document531 anti solicitation agreements especially Google Board of Directors received of Intel s an internal complaint Decl Ex employees Shaver technical We Paul Otellini key players I losing so Paul Otellini s answer people was Google CEOs as the agreements 26 2007 For example on September Class recruiting efforts many assertion that Defendants their to but thought are countering Google Executive to forward the email to Eric Schmidt of the Board of Directors and former CEO you should Eric can you pls help here Court of District Eric Schmidt and forwarded obliged on Google s the email to his recruiting Id Ex 35 activities The next day team who prepared Eric Schmidt replied a report for to Paul District If we a find that recruiter called into Intel we the recruiter will terminate Ex 50 see States l Ex 651 May 4 2006 email from Paul Otellini to Eric Schmidt Sorry to Northern United the For 19 topic but this my guys Additionally an email forwarded to felt 21 Apple 22 response Edward Catmull emphasized to 23 Technology 24 Edward Catmull informed Steve Jobs 25 Apple employee to work 26 424 27 another 28 whether Jobs would to check with Steve Jobs Several offer t he key to stay Rob Cook away from that employee still planned object to leave if the via email that as a test automation months later and is continuing assistant indicated Shaver Pixar Vice President engineers Id but w e of Decl Ex 68 an application declined No from an Cisneros Decl Catmull emailed Steve Jobs asking Pixar communicated with the employee and Steve Jobs gave 11 CV 02509 LHK ORDER GRANTING PLAINTIFFS SUPPLEMENTAL Ex Pixar again informing Pixar that he had Apple Id Edward In with this position 37 Case that Pixar Advanced Consistent Pixar had received engineer contacted to recruit our FormerChairman and FormerCEO of before extending a job offer to even an administrative that by Google Edward Catmull Pixar President CoFounder 20 compelled are very troubled MOTION FOR CLASS CERTIFICATION Case5 11 cv 02509 LHK Filed10 24 13 Document531 1 permission Id Thus 2 agreements enforced by Defendants 3 Page38 86 of members Plaintiffs evidence supports their top officers 4 c The stifled In addition showing to recruitment of Technical efforts Class Effect of the Absence of Cold Calling on the Class as a Technical 5 claim that these anti solicitation that Defendants valued cold calling Whole and that the absence of cold 6 calling hampered recruitment of members of the Technical Class the documentary evidence also 7 suggests that the lack of cold calls had a profound and common on effect all members of the 8 Technical Class 9 Plaintiffs allege that the elimination of cold calling deprived employees of information all 10 regarding pay packages that the employees could more have used to obtain employment lucrative 11 over or to gain leverage California Court of Mot pay increases Class Cert employers in negotiating existing at 16 The earning potential who knows employee of a valuable her market worth is illustrated by an 13 email exchange District their 12 at Adobe Out of concern that one employeea star performerdue to his 14 District technical and collaborative skills intelligence abilities might leave Adobe because he could 15 States easily get a great job elsewhere if he desired Adobe considered how him best to retain Cisneros 16 Northern Decl Ex1250 United the already For In so doing Adobe expressed concern about the fact that this employee had 17 interviewed with other companies and communicated with friends who worked there 18 Id Thus Adobe noted that the employee was aware of his value in the market as well as the fact 19 that the employee s friends were from college 20 Id In response Adobe decided to give the employee an immediate pay raise Id 21 Similarly as explained by Alex Lintner Intuit Head of Global Business whenever Division 22 somebody s being targeted by an outside company and we want to retain them we have a 23 conversation around how we can retain them so they don t take the offer from the outside 24 company Hallock Rep 199 In the example of one employee that Intuit wanted to retain Intuit 25 which was an 26 but in light of the employee s skills and contributions to the company Intuit 27 to make an investment Id 28 38 Case No 11 CV 02509 LHK ORDER GRANTING PLAINTIFFS SUPPLEMENTAL MOTION FOR CLASS CERTIFICATION was willing Case5 11 cv 02509 LHK While Defendants claim 1 key 2 individuals 3 by cold 4 Google employee in response 5 were recruited 6 getting counter 7 they received 8 as a tool to recruit 9 stating that 10 to retain may to Google s it go elsewhere to offers were s impossible by in the hopes offers more Googlers staying Alan Eustace Google at Google competition for workers 12 makes sense to make changes 13 comp 14 best feels much make allegation broader them my loyalty and to particular that the risk to As some this imposed noted by one who individuals a secret The people where also to the competitors those competitors talk This employee is 86 effects counteroffers exGooglers but Decl Ex 59 like their of made only keep something like to of improving Shaver it to and offers talk not just to Googlers their have had decision Page39 generally Plaintiffs evidence supports talent 11 California that counter and subsequent counteroffers calls Filed10 24 13 Document531 too using it expressed frustration being punished Id Senior Vice President commented on concerns regarding and Google s approach in by to counteroffers compensation even if it introduces noting that it discontinuities sometimes your current in Court of District to save your best people Id people and send Because recruiting a a message few to the hiring really good company people could that we ll fight for our many many inspire others District 15 to follow Alan Eustace concluded you can t afford to be a rich target for other companies States 16 Id According 17 off s but to have 18 get a better him the to long term right approach is not to deal with these situations as one Northern United the For 19 a systematic approach to compensation very for anyone difficult informationspread by cold 21 that affected 22 the anti solicitation 23 impact of 24 Plaintiffs theory that Defendants 25 put 26 Plaintiffs theory that if the anti solicitation 27 to take actions all this members calls not merely of the Technical agreements eliminated elimination affected structural incentives on an Class a key individual Thus to retain Plaintiffs evidence suggests tool of recruitment cold calling the entire Technical elimination basis but with a structural response Class The documentary of cold calling allowed evidence supports Defendants not to have to employees This common evidence provides support for agreements did not exist Defendants would have had not only to retain the particular employees who may have received the cold calls 39 No not only that but also that the 28 Case to evidence suggests that Defendants would have responded to the 20 place it offer Id emphasis added This documentary in makes that 11 CV 02509 LHK ORDER GRANTING PLAINTIFFS SUPPLEMENTAL MOTION FOR CLASS CERTIFICATION Case5 11 cv 02509 LHK Filed10 24 13 Document531 1 but also that Defendants would have had to take broader 2 Technical 4 As 5 maintained 6 within those structures This additional 7 that the anti solicitation agreements downward 8 have applied 9 affected the Class employees salaries 10 forth set below Plaintiffs documentary formal compensation similar downward and ranges by which they evaluated 13 At Adobe every 14 across First Plaintiffs evidence supports 12 made significant their Adobe s efforts maintain internal equity to evidence further supports on pressure Defendants individual Plaintiffs theory employees salary structure jobs into and on a job title salary structure which and every job included title a salary all all Technical Defendants pay bands zones grades and paid employees in groups in relationship was assigned would salaries claim that during the class period compensation structures and divided job position salary range within evidence further shows that Defendants documentary pressure used formal administrative Court and structures 11 District would have Compensation Structure and Internal Equity ii of that 86 of Class as a whole 3 California action Page40 groups to other had a corresponding minimum middle and District 15 maximum See 16 G 17 would 18 shows that 19 categorizing 20 levels assigned 21 to Cisneros Decl Ex C ArriadaKeiper Depo at 16 20 159 18990 259 id Ex States Northern United the For Vijungco Depo at 29 Adobe expected Id Ex F fit and compensating its workforce to all salaried employees at 57 Apple had 23 comprised centrally established 24 Google 25 within grades 26 Depo at also had See 74 76 eg many job structure a system which according to a discrete set of and testifying that Google s ranges Throughout Decl min mid and max company 6 10 had Google Ex B many job see also Cisneros Decl Google generally No the id Ex X Wagner same structure utilized salary ranges and Ex S Depo as the at titles Brown at 49 50 salary pay bands with minima 11 CV 02509 LHK ORDER GRANTING PLAINTIFFS SUPPLEMENTAL Depo Every salary range 40 Case wide job amounts See ids Decl Exs 15 16 salary ranges utilized by the class period data included Burmeister job families many grades within job families and salary ranges salaries sets of base salary ranges applicable Burmeister Harvey Suppl discussing employees Similarly Apple s compensation Id Ex M 14 15 52 53 Brown Decl Ex 16 28 Depo Streeter for each year in the Class Period 22 27 that the distribution of its existing MOTION FOR CLASS CERTIFICATION Case5 11 cv 02509 LHK Document531 maximaand medians Hallock means Filed10 24 13 Rep 1 and 2 Depo 3 had generally 4 Google Senior Vice President Business Operations 5 you could understand 6 S Brown 74 76 id Ex X at same the Depo 8 id Ex BB 9 call them 10 to a grade level 11 Ex CC 12 similar to a job 13 applied 14 at 15 Depo Wagner structure that role had a Intel McKell RD or was Depo based on specific at W 73 66 86 of see Cisenors Decl Ex S testifying that Google s Brown salary ranges ranges As explained by Shona Brown former level Depo Conrad compensation and nontech tech salary a at 49 50 at as the 9495 id Ex Y at Likewise 7 California either Page41 if you on a discussed certain job a specific role at Google ladder Cisneros Decl Ex 23 at structure with job grades and job classifications e break jobs into one of three there s a more lot categoriesjob The company Id Ex Y families 23 we employees assigned Depo See id Adobe Murray Depo grade their at 45 Intel and experience skills Conrad that everyone at Intel explaining standardized is assigned a salary ranges throughout its at classification company the see also each range Court of District 59 to multiple Intel jobs and most jobs spanned Id Ex BB salary grades multiple and compensation further at McKell Depo Intel like District States Id 16 at 62 63 Northern United the For The 17 other Defendants had 18 titlesas 19 percentiles and categorized 20 Lucasfilm s compensation 21 Cisneros Decl 22 similar job titles or job classifications 23 families and 24 each position indicated by documents similarly set salary structures Ex LL groups see id Ex tracking scheme Coker included Depo id Ex VV SS McAdams at job 246 titles Depo 26 used specific guidelines 27 ranges for setting and adjusting salaries to ensure that employees Hallock matched Lucas Depo at at Depo 78 136 at to 85 89 job families see 137 138 and established No and tools For instance to assist Adobe had an salary ranges for managers online salary ranges in staying within Defendants the prescribed salary planning tool as well as with guidelines based on market salary data 11 CV 02509 LHK ORDER GRANTING PLAINTIFFS SUPPLEMENTAL had Pixar used job 41 Case who 29 were paid within the prescribed matrixes which provided managers Rep as well as set salary ranges for employees id Ex NN Sheehy that were had job families and job high information job codes and formal bands Second salary low mid and jobs into 25 28 salary Intuit MOTION FOR CLASS CERTIFICATION See Case5 11 cv 02509 LHK Ex C 1 Cisneros Decl 2 populated with employee 3 sic You 4 range 5 guidelines 6 allocated have the information we recommend that Apple The in how in terms of 9 manager on so the employees It might want shows them what the kind of the about spending think to team their tool also has the ability to provide managers employees their Depo at levels See 52 53 id Ex O id Ex Mansfield 12 the 13 understood what the boundaries employee at 33 advisor and Depo Baja I Depo Apple Senior Vice President Ipod Division and which was an recruiting tool called employee records and performance preset at and 11 California 86 ssentially the salary planning tool is current compensation their a Human Resources also created internal system for tracking Fadell at of budget 8 10 kind of look to Page42 E 82 3 at for a particular for the current role that they re is 7 Depo ArriadaKeiper ability Filed10 24 13 Document531 managers to grade 14243 145 46 id Ex N at As explained by Tony Jobs to Steve this is the level here are the salary ranges required former Fadell would say and through that tool we this is we were then Court of District 14 Intel also used a software were Id Ex N Fadell Depo 53 at tool to provide guidance to managers about an employee s pay District 15 range which would also take into account market reference 16 Decl Ex 9 As explained 17 the tool 18 outside 19 at ranges and merit Suppl See Harvey States by Randall Goodwin Intel if Development Manager Technology Northern United the For 52 recommended something and we its guidelines accord Hallock 20 Intuit we would Rep write some Depo Cisneros Decl 22 Talent Development former Vice President 23 Acquisition Director 24 acknowledged 25 usually use s McNeal make decision Similarly Frank Wagner 27 the target salary range for jobs at Google Wagner Depo at 76 99 57 58 make a proposed change s Google Q And if to managers Ex Z Michael throughout McNeal of Talent Strategy Vice provided that Intuit 26 28 at of Talent Acquisition and example to the to Cisneros Decl justification guidelines 21 for wanted No Depo Goodwin Manager about compensation through you wanted of Compensation at identify what the company 99 testified that he could See the target salary locate id Ex would be 11 CV 02509 LHK ORDER GRANTING PLAINTIFFS SUPPLEMENTAL of of Talent the variables that Id See Recruitment an internal company website to company Vice President President of Executive guidance about Director Intuit the 42 Case was that 77 similarly gave compensation Ex GG we thought MOTION FOR CLASS CERTIFICATION X for a Case5 11 cv 02509 LHK 1 2 that for that job family Third 3 and their 5 below 6 annual review and 7 salary ranges 8 explained 9 Page43 of some place 86 and pull up what A Yes grade that Plaintiffs evidence indicates 4 that Defendants expected compensation Adobe s to be set within employees were competitive Id salary ranges deviations required minimum recommended the 10 would we also result range was salary adjust to practice them minimum as to the Depo ArriadaKeiper if 24 at Deviations from the a reason because we you need believe be in to 12 without express 13 prescribed 14 N 15 bunch 16 programs were designed 17 See 18 Human 19 Administration were responsible 20 their McKell Depo at 64 and at id Ex HH approval Intuit recruiters could Depo Nguyen at its to be employees from salary guidelines not deviate 72 73 90 92 range this Similarly Intel regularly ran reports showing the salary range distribution of id Ex BB part of the with managers wherein Adobe s officers in conversations minimum for have a special approval them Id Ex C red flag 11 California could you go online or go to certain job within a certain grade was Filed10 24 13 Document531 At Apple going outside Court of District Fadell guidelines Depo 53 at also required extra approval And we if were to go See outside id Ex J of that then Depo Bechtel we would at 217 id Ex have to pull in a District of people to then approve anything outside of that range Google s compensation States and overseen by a special department monitored People called Ops Northern United the For id Ex 5 Brown Resources Fourth 21 Analysis pool allocated compensation 23 maintaining internal 24 similarly both in 25 As looked 27 that s 28 need to at and Lori finally at McAdams for ensuring Ex VV shows Pixar Stephanie Sheehy Pixar Vice President of Pixar Manager of Human that salaries for each job group Sheehy Depo Resources remained within 77 78 at not only that Defendants maintained formal idea that employees doing the same work would generally No be paid hiring and promotions by Debbie Streeter Adobe Vice President as a data point because if more than somebody who s an that before you bring them Total Rewards Adobe existing in Id Ex F employee that Streeter s Depo a high performer you at 175 Similarly when 11 CV 02509 LHK ORDER GRANTING PLAINTIFFS SUPPLEMENTAL always you are going to go hire somebody externally 43 Case and but that the details of these structures were driven by concerns about equity the internal equity know 24 And Cisneros Decl structures explained making at Plaintiffs evidence 22 26 Depo MOTION FOR CLASS CERTIFICATION Case5 11 cv 02509 LHK 1 considering 2 considered 3 whether Concerns extend a counteroffer Adobe advised to Id Ex Burmeister Apple Senior Director Burmeister defined 6 individual s 7 organization 8 determining starting salaries 9 explained by Patrick Burke inheres in 11 join the biggest 86 internal equity should ALWAYS be program an employee s compensation some all of not if Id Ex M former Apple Technical comparing Depo determining factor on what at Recruiter the candidate based on the fair your or across consider in 61 64 id Ex 1856 on Id Ex L we gave In fact as Manager when and Staffing to the other people salary is that managers the guidelines Burmeister group Steven equity which that internal testified relative to the other employees in your contribution a new employee at Apple emphasis Compensation of as the notion of whether 10 12 of about internal equity also permeated Apple s compensation 5 California Page44 216.5 4 was Filed10 24 13 Document531 the team they Burke hiring would Depo 279 at added Court of Likewise Google considered 13 14 salary algorithm 15 a reasonable range 16 District overall 17 increases internal equity in part for the purpose of to be an important goal e nsur ing internal equity by Google managing utilized a salaries within District Id Ex 1613 Furthermore because Google strive d to achieve fairness in States high performers with low salary distribution would salaries get larger percentage Northern United the For 18 Similarly Intel used internal equity 19 employees that corresponded 20 210 211 id Ex 398.8 To 21 Equity Report 22 the words of 23 screams egalitarianism 24 treating to Ogden Reid we play 26 compensation 27 regarding 28 compensated and how committee the subject this positions for approval employee s factored heavily lip service new hires Id Ex BB used a tool that generates Id Ex BB of Compensation everyone the same within broad new Intel new employees Director While all determine wage rates for in that process offers to Intel to each job s relative value to Intel assist when making At Lucasfilm 25 Id Ex 1618.14 than high performers with high salaries McKell and Benefits to meritocracy bands Id Ex we and McKell an Depo much No Depo Internal at 21213 really believe more to be accompanied by Peer Relationship or candidate s colleagues inside the into committee See in decisions to id Exs 710 729 2084 MOTION FOR CLASS CERTIFICATION its information company were 11 CV 02509 LHK ORDER GRANTING PLAINTIFFS SUPPLEMENTAL In 2035.4 and out of cycle compensation adjustments presented were at of our culture 44 Case current Case5 11 cv 02509 LHK 1 2 request 3 positions 4 it Acquisition of Talent with the manager requesting Chris Galy explained new the hire See was that maintaining internal equity ten hire one person and lose 8 situation in which 9 salary in order to preserve bringing in a Id new at 201 person internal equity new at Id and hires id Ex And 194 95 comp in similar is Depo y ou 20003 at don t want to about a specific recent employee s raising another we so got a that he always discusses because testified we that internal equity FF Galy a higher salary required at 86 had were testified important Chris Galy also of most cases when Lucasfilm Director always one of the considerations in determining pay for 7 In Chris Galy 6 pay increase did an action 10 for 11 12 41 42 at the survey data and all of the internal people that internal equity 10 Depo Condiotti Page45 would have 5 California MM 2092 2094 2096 id Ex Filed10 24 13 Document531 See Pixar similarly expressed concerns with maintaining internal equity Depo Batali If 67 at someone eg id Ex QQ being paid more than someone feels like they re I know who Court of District 13 has more value 14 salaries of similar employees it raises a bit of a to flag id Ex UU Zissimos ensure they were not out of Depo at 71 discussing comparing whack District Due 15 Defendants formalized pay structures and compensation design to Plaintiffs States 16 evidence indicates that Defendants concerns with internal equity could lead to classwide 17 in compensation 18 between 19 existing 20 and emails before 21 reviewed changes Northern United the For new 23 align 25 26 10 and a quity ing the result of the anti solicitation existing after A dynamic s individual employee more appropriately sic high performing out and best reflected was to ensure its workforce djustment ago where we went team we recognized is the anti solicitation agreements Chris Galy stated in his deposition have an agreements employees Defendants considered precise employee salaries O E 24 and hires employees This 22 ut levels as hired in in Defendants compensation own internal documents within range and implemented 28 Call for the explicit purpose of and based on how that manager would come in and say I believe that I had one of these about a month ago couple months a somebody and we were as we at risk of potentially having were looking at some of the folks this on know not in the market range so we did an action for We gave a increase Cisneros Decl Ex FF Galy Depo at 195 Defendants contest this anecdote by contending that the employee in question received a salary increase for purposes unrelated to internal equity record Yet the portions of Chris Galy s deposition The Court relies on the materials No 11 CV 02509 LHK ORDER GRANTING PLAINTIFFS SUPPLEMENTAL salary that the Defendants cite are not in the that the parties placed in the record 45 Case the person feel like they were you 27 for Lucasfilm regularly and proactively in their salary range I just that the person is increasing compensation increases Where fact In the face of inequities MOTION FOR CLASS CERTIFICATION Case5 11 cv 02509 LHK 1 2 employee aligns with At 3 4 Depo Maupin at Intel a Filed10 24 13 Document531 internal peer group based their on the same Page46 set of 86 Id Ex OO of criteria id Ex 730 194 human resources document from 2002 prior to the anti solicitation agreements recognized 5 and Id Ex 392 6 In response planned to Intel 1 7 2 and 8 An Id 9 human Intel resources document confirms that 11 California Decl Ex Harvey Suppl 10 10 at 7 emphasis added At Adobe 12 five months before Bruce Chizen former Adobe CEO entered into an Court of 14 eliminate Human CoFounder agreement with Steve Jobs 15 District 13 cold calling between the former Chairman and FormerCEO of Apple to companies Donna Morris Adobe Senior Vice President Global District Resources Division expressed concern about internal equity due to States 16 Decl Ex 17 Harvey Northern United the For 17 Adobe 18 19 respond to personnel the problem stated that because of the they may not be able to immediately Id 20 The 21 effects of internal equity may have example been even more concentrated 22 Class 23 positions 24 range of salaries and 25 Id Pixar had Tools Software Engineer leveling 26 framework 27 adjusting Intuit for 28 versus a all other s Cisneros Decl compensation Ex 2739.70 even for employees of similar salaries for evaluating salaries differentiated between See the expected contribution id Ex 1309.1 Pixar decided to After Technical technical matrix that of it used their software Pixar determined make for engineers that within the Technical and other technical employees had a employees to give engineers some Pixar a consistent and of its Id From Pixar 46 Case No 11 CV 02509 LHK ORDER GRANTING PLAINTIFFS SUPPLEMENTAL to justify MOTION FOR CLASS CERTIFICATION s Case5 11 cv 02509 LHK 1 perspective the 2 members who are performing at the highest 3 a 4 seeing clear message to these much more sum 5 In 6 structures 7 the Technical 8 that of her peers 9 the impact of 11 California these factors salary proposals that we Page47 to compensate is value them at Plaintiffs evidence supports the is levels This of 86 We pre emptive strike a as least much team the lowest paid as some new want hires who their premium Defendants placed on finds persuasive Defendants compensation on are theory that Defendants formal compensation internal equity a market for created Class of employees in which any individual s compensation was intertwined The Court send to companies Id competitive offers from other combined with 10 new goal of the Filed10 24 13 Document531 Plaintiffs contention structures that common questions with about focus on internal equity and the effects of their Class as a whole are likely questions the Technical 12 Impact iii of to predominate over any individual Labor Market Competition Court of Thus far 13 the Court has discussed Plaintiffs documentary evidence of the effects of cold and Defendants internal equity concerns on wage 14 calling 15 suppression across the Technical 16 District suggests 17 Class members employed by other Defendant firms because the Defendants viewed 18 competitors for the same employees This competition often meant that Defendants benchmarked 19 compensation Defendants compensation structures District Class Now the Court turns to documentary evidence that States that wage suppression within an individual Defendant firm may have affected Technical Northern United the For Adobe 20 based on each other or based on for example viewed 21 14 23 Google Apple and 24 benchmarked 25 Decl Ex 15 26 27 Adobe direct further considered its Intuit as itself Ex 2800 considered Apple not actually benchmark other against cf Cisneros Decl external to be winning sources among its top the talent competitors war Shaver horses companies See Shaver including showing that Google compensation against and Intel to these latter in be Decl Ex 15 In Google Apple and 2010 Adobe reference considered peers companies 47 No Decl Ex 11 CV 02509 LHK ORDER GRANTING PLAINTIFFS SUPPLEMENTAL 2008 Adobe Intel Intuit Shaver to be a though Adobe did 28 Case for talent horse race from a benefits standpoint which included in a among the compensation peer and Google and Apple about whether Adobe was and expressed concerned 22 common each other as MOTION FOR CLASS CERTIFICATION Case5 11 cv 02509 LHK 1 Similarly throughout 2 compensation 3 designated 4 to a as on an 6 President 7 that 8 beat Google company Google analysis of as biggest for Apple among other companies Intuit based on meeting a key to its and Dave of its In it company 2007 a based in part Bock Google Senior Vice Google Equity Compensation Manager wrote Rolefson labor market competitors are to talent Id Google identified The Walt Disney Company which now owns Intel as well as companies USbased stand alone 10 Pixar and Lucasfilm as 11 California equity high tech Id Ex 173 peer companies Laszlo 86 each of which such as being a criteria competitor labor market compared of People Operations o ur 9 peer Adobe and Intel Page48 Google analyzed and compared the class period company and high growth 5 Apple Filed10 24 13 Document531 public companies 12 talent have revenue market capitalization and performance that are generally peer that in the Apple a phrase Apple defined as view compete with compensation committee s Apple comparable for to Court of District 13 Apple 14 Ex 1855 Cisneros Decl Intel also benchmarked compensation against tech companies other considered generally District Intel which 15 comparable 16 communications and 17 to Intel in to Intel defined b lend as a of semi software networking States diversified computer Cisneros Decl companies Ex 2030.115 According Northern United the For 2007 At Lucasfilm 18 19 Directors 20 Defendants 21 these comparable a 2007 meeting corroborates The update extremely diverse Recruiting many states that Defendants in this case including 23 its difficult and positions to fill Apple and Google included Human Resources of the dynamics 1 passive needs for each division 22 most companies talent 3 its Update that appear to have was difficult Bay Area Pixar Google and Silicon to Id prepared for a Board of been at play for find 2 Lucasfilm competition included Valley generally and included members of the Technical had other 4 some of Class including Id Ex 690.1922 24 25 Further there 26 common 27 compensation external is evidence that Defendants also benchmarked sources most commonly structure Radford or their Croner Adobe compensation data to for example pegged as a 28 See id Ex C ArriadaKeiper Depo at 16 see also 48 Case No its 11 CV 02509 LHK ORDER GRANTING PLAINTIFFS SUPPLEMENTAL MOTION FOR CLASS CERTIFICATION id Ex M Case5 11 cv 02509 LHK 1 Depo Burmeister how discussing a 3 against 4 market targets that Adobe used as benchmarks 5 high tech those 7 determining salary Depo Chizen that were 98 at or that Pixar compared itself for setting salary ranges tended the position At times Defendants would make adjustments to to be software Id Ex A existed salaries in order to their and use that as part of the process for determining its own id Ex CC at 23 pay delivery Id Ex BB at 90 10 11 Plaintiffs documentary evidence further suggests own pay practices 12 competitiveness 13 company 14 Shaver 15 Resources 16 California the particular would Intel id Ex BB at 89 focal process 86 of CEO explained that similar to wherever geographically showing 1309.1 former Adobe Bruce Chizen For example stay competitive 8 9 survey the Radford Page49 Apple used external market data such as Radford as ranges id Ex 2 6 reference when 52 55 at Filed10 24 13 Document531 Human Resources among others 17 stating 18 close more or 19 President 20 We 21 their 22 could safely share 23 that when determining the anti solicitation agreements of their Defendants matched job title compensation within the Court of District to similar titles across Ex Suppl Decl multiple companies 122 email from Lori and shared compensation McAdams information See PixarVice President of Human District and Administration to Sharon Coker former Lucasfilm Director and Senior Director of States asking about others budget for salary increase FY 07 and Northern United the For o urs but is it less Cisneros Decl Ex of People Operations called tech companies this are merit budgets this 24 The 25 competition against 26 we may manage week 621 o ur stating to check Adobe on average closer to email from Laszlo Bock budget is Google Senior Vice comparable to other tech companies merit budgets to Apple data only because Are you doing anything compare to our 3.9 other Defendants Defendants Intel they were not in fact competing of in this Software to case Lori and Administration Ed Catmull 27 Resources 28 Senior Vice President for employees due to the of Strategic is reflected McAdams Pixar President in a 2006 email from Howard Look Pixar Vice and Ali President Rowghani of Planning 11 CV 02509 LHK ORDER GRANTING PLAINTIFFS SUPPLEMENTAL Human Pixar CFO and 49 No told us Defendants would have experienced due to market competition including pressure former Pixar Vice President Case They MOTION FOR CLASS CERTIFICATION Case5 11 cv 02509 LHK new This 1 the bay area tech cost 11 California 12 Court of District 13 14 District 15 but for a We engineers have recounted if you Brin CoLead make any new threatened Director on out there new offers or contact 2005 team Steve we may advisor people at Apple Chairman we Former as Brin stating war Id Ex 1871 Google until that CoFounder CoFounder means to to Defendants hearing after Jobs as well as Bill Campbell Apple and of in Google Sergey Brin Management Team Id Similarly in 2005 when discuss For example agreements hire a single one of these people that Google s Executive not going for us beyond lots there s a lot going trying to recruit employees from Apple s Safari Board of Directors sic best to higher about competition for employees contributed felt Chairman Former CEO of Apple to much Ex 1306 enter into anti solicitation to Google was email the there is risk that The concern Defendants decisions recruiting has and do our should also acknowledge apps engineer software why more Cisneros Decl 7 10 we and with lose 9 but 86 to other tech companies be fiscally prudent to of been feeling about and helps partially explain two people lost Page50 what we ve corroborates obviously want for experienced of backfilling base salary 5 8 we ve budget stay within our 4 6 why We 3 up market heating been so hard and 2 from Radford market data Filed10 24 13 Document531 In an of Intuit Sergey Brin advised lets have had a chance to whether to enter into an anti solicitation considering States 16 Northern United the For 17 18 19 20 21 agreement with top talent Jobs Steve 24 25 will do it in wooing it s did not enter into open season a way in other than senior Steve he will go which they will be Harvey Decl to stifle rising costs Board and don t after enticed 27 wars 60 rapidly From the perspective CEO Lucasfilm c ouldnot that sort of stating in an email that Pixar of seriously managers he some to will deliberately of our top come Apple Mac talent extraordinary stating poach No Adobe I tell just to and he like packages and Steve George Lucas thing a war with bidding Cisneros Decl and Lucasfilm messes up the pay structure other companies Ex NN have agreed that Pixar President by every offering at we 44 because see also Shaver we Decl want to avoid bidding time a studio high salaries to tries grow 11 CV 02509 LHK ORDER GRANTING PLAINTIFFS SUPPLEMENTAL way former Lucasfilm Chairman of the 50 Case if perceived the anti solicitation agreements as a get into As expressed by Edward Catmull it agreement with about the loss of Ex 14 have the margins for Ex CEO expressed concerns an anti solicitation In addition Defendants appear to have 26 28 Adobe former Adobe Bruce Chizen prove a point Knowing 22 23 if Apple MOTION FOR CLASS CERTIFICATION to grow at the rate Case5 11 cv 02509 LHK 1 2 a company desire Ex RR 3 Depo Catmull That s s people So it do I 5 Norther 6 and a couple smaller places 7 61 8 Whitman 9 Board of Directors and former Notably Ex 872 11 of the valley As CEO of eBay Eric Schmidt because The evidence 12 have conscientiously Steve Jobs entered shortly after former 10 California w up very high to the in Lucasfilm Dreamworks Shaver Google s salaries across board the Google said Meg Google of the Cisneros Decl hiring practices Ms Whitman Ex Decl Google Executive Chairman Member indicates that Defendants therefore up here other each it Decl in response into an anti solicitation agreement with to talk about driving ILM Pixar told Google s senior executives you are makes It it Writing avoided raiding called Eric Schmidt CEO see also Cisneros does It 86 of e have avoided wars up here of the companies all about feel strongly head of Disney Studios Edward Catmull explained California because Id Ex 61 and leave 4 n Page51 messes up the pay structure it got And we ve the reality just will hear about 179 at Filed10 24 13 Document531 is the talk Id sought to enter into anti solicitation Court of agreements in an effort 14 that they were 15 otherwise would have to 16 District 13 the anti solicitation 17 affected 18 The 19 be to stifle competition for labor and rising wages increased successful Defendants did not need to increase compensation as To much the extent as they District and retain employees attract This common evidence further suggests that States agreements reached beyond individual members of the Technical Class and Northern United the For the compensation extensive documentary To show 22 Plaintiffs 23 Hallock 24 11 common D and a Ph B A in Mathematics D econometric forecasting 12 Kevin Joseph Statistical own reports from their Chauncey J Medberry the their Statistics at Defendant firms theory that they will basis Evidence classwide impact E Leamer PhD experts Kevin Professor of 11 F M Murphy PhD 13 Management Angeles of CaliforniaLos the University and Kevin Professor of Dr Leamer 1966 and a Masters in Mathematics 1970 He has published on the topics methodology and statistical analysis international economics and macro economic including on the subject of inferences that may appropriately be drawn from non in Economics experimental data 28 is a classwide two experts Edward of Defendants presented E across therefore supports on violations including predominate for the purpose of assessing issues further retained the services PhD 12 present Expert Reports and Edward Leamer Ph Economics and Professor of earned a 27 that whole Class as a Plaintiffs of the antitrust b 21 26 evidence able to prove the impact 20 25 of the Technical F Hallock Ph R Rich at D from Princeton the University is 80 Professor the Donald Professor of University of Michigan C Opatrny Economics in in 74 Chair Professor of the Department of Human of Resources 51 No 11 CV02509 LHK ORDER GRANTING PLAINTIFFS SUPPLEMENTAL Case MOTION FOR CLASS CERTIFICATION of Economics Studies and Case5 11 cv 02509 LHK Shaw Ph D 14 Filed10 24 13 Document531 Dr Leamer s and 1 and Kathryn 2 The Court begins by 3 which support 4 criticisms of 5 rely The Court finds that methodological deficiencies 6 criticisms unpersuasive 7 Leamer and 8 individual to attack the methodologies describing common Plaintiffs theories of Dr Leamer Dr Hallock The Court Dr Hallock Dr and the materials on which therefore 86 and conclusions Leamer and Dr Hallock Court then turns to Defendants Dr Leamer Defendants and Dr Hallock reports render the expert finds that the methodologies commonquestions demonstrate that Dr of harm The in of Hallock s analyses and analyses impact of Page52 and theories of are likely to predominate Dr over questions 9 Dr Leamer s i Opinions Based on Economic Documentary Evidence Data and 10 Dr Leamer s In report which was presented expert first Theory Analyses Statistical in support Motion of Plaintiff s for 11 Class Certification California Dr Leamer asked Plaintiffs to evaluate whether classwide evidence was 12 Court of capable of showing that the anti solicitation 1 members District agreements reduced the compensation artificially of 13 and All Employee classes generally and of the Technical 2 all members or most of 14 District 10 a Rep each class See Leamer 15 States there was a reliable classwide In addition Plaintiffs or formulaic method capable asked Dr Leamer of quantifying assess whether to amount the of 16 Northern suppressed compensation suffered by each class United the answered For member Leamer Rep 17 these questions 10 b Dr Leamer the affirmative in 18 19 20 Director 21 of the Cornell Economics from 22 23 compensation 13 structure in the Booth School Murphy 24 Princeton in 1981 received and a a Compensation Studies the University at University in 1995 He is is the George J Stigler of Business and the Department bachelor s PhD in at Cornell of Massachusetts at a leading University Amherst in labor economist degree in economics economics Distinguished 25 and an expert in in Service Professor of Economics Economics at the University of Chicago from the University of CaliforniaLos Angeles of from the University of Chicago in 1986 published on labor markets and the determinants of wages and compensation has addressed the market determinants of wage by economics Dr Hallock and a PhD 1991 and design M Murphy PhD Kevin for Institute B A in Economics earned a skill Dr Murphy has His work in labor level as well as the determination of relative wages across industries and occupations 14 26 Kathryn Shaw Ph 27 28 D is the Ernst Dr Shaw School of Business C Arbuckle Economics Stanford Graduate an AB degree from Occidental College and PhD Professor of go within companies and use from management practices researchers performance gains the in Economics from Harvard University Dr Shaw has published on the She also co pioneered the field of insider econometrics a research in which at received insider knowledge topic of personnel field and in personnel No 11 CV 02509 LHK ORDER GRANTING PLAINTIFFS SUPPLEMENTAL economics data to identify the 52 Case economics MOTION FOR CLASS CERTIFICATION Case5 11 cv 02509 LHK Dr Leamer s 1 analysis proceeded 2 studies and theory documentary 3 anti solicitation agreements 4 class 5 words 6 least 7 the absence 8 studies and theory documentary 9 suppression of compensation members from Dr Leamer and how that work Class Cert Mot 16 at classwide evidence was capable of showing that economic at preventing other In the very Defendants were paying some members of the class less than they would have been paid in Second Dr Leamer of the anti solicitation agreements evidence affected all and analyses statistical or nearly all class followed a roadmap widely accepted 10 Leamer s approach 11 California explained employee compensation generally by the true value of their discovering 86 of were capable of showing that the analyses statistical suppress to Page53 two steps First Dr Leamer in evidence tend ed illustrated Filed10 24 13 Document531 of general 12 capable of showing widespread harm to the class See are capable members Plaintiffs to conclude that eg of WL that this noted that Dr that use evidence common Johnson 2009 economic showing class actions in antitrust price effects plus evidence of a price structure how illustrated evidence 5031334 is 8 11 at Court of 13 predominance finding conduct was alleged where 14 evidence was presented 15 Linerboard Antitrust Litig 305 16 District structure that bill rates to suppress bill rates for nurses generally and were correlated with nurse pay rates see also In re District F3d 145 153 55 3d Cir 2002 endorsing regression plus pricing States study to show classwide impact Northern United the For 17 In Dr Leamer s supplemental expert 18 supplemental 19 raised 20 impact 21 additional 22 Defendant that would have transmitted 23 the Technical by motion for class certification Leamer focused analyses his supplemental confirmed his Dr Leamer first Leamer methodology the Technical a somewhat to respond to questions could show classwide Class and found that his rigid pay structure concluded that classwide evidence was capable of showing that the anti 27 According 28 such as Dr Leamer this first market price discovery step Dr of Technical was supported by Class members generally principles Leamer noted that when of information evaluating economics the functioning 53 No throughout Suppressed Compensation Generally solicitation agreements suppressed compensation Case at each 13 26 to of on Dr of the the effects of the agreements broadly including a 25 initial report original finding Class Leamer Suppl Rep 24 asked Plaintiffs Dr Leamer s the Court related to whether Dr report which was prepared in support 11 CV 02509 LHK ORDER GRANTING PLAINTIFFS SUPPLEMENTAL MOTION FOR CLASS CERTIFICATION of labor Case5 11 cv 02509 LHK 1 markets economists 2 are powerful 3 the 4 reality 5 can slow the process 6 price discovery 7 when change high conditions by which by which that market forces demand at approximately Rep Leamer 71 In costs and limited informationflow transaction participants Dr Leamer 72 73 Id Market in a market search for this equilibrium dislocationinvolved 74 11 who 12 those 13 tend 14 experience 15 valuable 16 these passive 17 of information for employees about outside Id are not actively Defendants and other high tech companies looking are looking for time number for high tech jobs limit the in searching new employment who costsincluding opined that the high transaction 10 California supply and 86 occur prices reach market equilibrium transaction the process presume s that virtually all transactions market price which equilibrates labor market is enough rapidly of Id 71 8 9 enough and work Page54 model which often use a market equilibrium pricethe same Filed10 24 13 Document531 for new new employment jobs active opportunities candidates because money and of existing workers seeking value potential passive personal employees candidates more than currently satisfied employees 1 Court of District to be perceived more as qualified and track records diligent 2 often and reliable that save the hiring company search and on the job have training 3 are training costs and District assets that if hired away from harm competitors rivals can Id 62 Thus recruiting States candidates by cold calling is both an important tool for employers and a key channel Northern United the For Dr Leamer 18 hypothesized that by 19 employees Defendants anti solicitation 20 compensation 21 to discover 22 fewer opportunities 23 that could 24 71 76 to agreements impaired information their salaries have been used to negotiate In addition Mot at 3 Defendants the competitive value of their services increase Dr Leamer 25 Defendants could avoid taking 26 and other forms of profit sharing 27 57 62 75 cold calling and other competition over restricting and job offers Class Cert and obtain opportunities Id inhibition flow about of employees meant employees were by moving between firms and deprived afforded of information higher wages and benefits within a firm See Leamer opined that by limiting the information available to 80 affirmative steps such as offering to their retain employees with valuable firm specific 11 CV 02509 LHK ORDER GRANTING PLAINTIFFS SUPPLEMENTAL employees skills 54 No Rep employees financial rewards 28 Case ability MOTION FOR CLASS CERTIFICATION Id 77 Case5 11 cv 02509 LHK 1 Dr of this hypothesis In support Leamer 2 economists 3 imperfection 4 Information and the Change in the Paradigm 5 see 6 people 7 imperfections 9 could have a profound alter Rep 37 38 behavior their effect also relied on 81 88 Rep work 40 The 86 of Nobel Prize winning Am Econ markets function This Joseph Stiglitz Rev 460 2002 461 convey information leads fact that actions why is information effects the documentary evidence common the anti solicitation to the class as agreements and compensation 10 See Leamer 11 California of of the equilibrium Economics 92 in Page55 even a small amount of information that the nature how and changes for the link between further support on see also id have such profound Dr Leamer 8 cited to the such as Joseph Stiglitz for the proposition Leamer Reply to Filed10 24 13 Document531 For example he cited to Defendants internal documents that but for the anti solicitation agreements 12 cold calling each other s employees and that Defendants recognized 13 forms of employee 14 could then have broader effects a whole as reduction indicating Defendants would have been competing for labor and calling and other that cold Court of District had the potential solicitation to drive up employees which the cost of specific Id District 15 Finally Dr Leamer with standard bolstered his findings econometric analysis utilizing States Dr Leamer evidence and methods 16 solely classwide 17 who 18 theory of price discovery at 19 analyses 20 undercompensation 21 conspiracy 22 showed 23 Defendant performed an analysis to show that employees Northern United the For changed firms received 15 higher internal compensation by comparing concluded that the anti solicitation agreements artificially Leamer Rep who stayed reflecting the economic also performed data to illustrate compensation during the conspiracy Dr Leamer free but for world than those 89 93 Dr Leamer work Id Defendants utilizing compensation 14546 Figs class regression members with compensation in a regression analyses suppressed compensation at each 20 24 b 24 that the multiple multiple Widespread Effect 25 15 26 A regression is a statistical tool designed to express as price and explanatory variables that 27 used to isolate the effect that might also influence 28 Antitrust Litig 276 of an alleged may affect conspiracy price like costs and FRD 364 371 the relationship between the first variable Regression on price demand CD Cal 2011 taking one variable such analysis can be into consideration In re Aftermarket internal quotation Auto other factors Lighting marks and omitted 55 Case No 11 CV 02509 LHK ORDER GRANTING PLAINTIFFS SUPPLEMENTAL Prods citation MOTION FOR CLASS CERTIFICATION Case5 11 cv 02509 LHK Dr Leamer Second 1 statistical 3 effects 4 studies and theories of loyalty 5 data to explain 6 agreements would have been 7 significant chance 8 internal equity were capable of showing that this compensation In both his initial report and his supplemental how of 86 and fairness the adverse effects felt of receiving relied on economic evidence and internal equity as well as documentary on compensation due to a cold call and employees who Defendants anti solicitation a received are linked Suppl Expert Decl Rebuttal and suppression had widespread Dr Leamer by employees who would have Leamer considerations report evidence call or had a cold to these groups due to Rep Leamer Suppl Reply 27 28 9 Based on economic studies and theories involving 10 11 Leamer contended 12 markets rely on committed 13 interests 14 small change 15 termination This would create enormous uncertainty 16 California Page56 opined that economic studies and theory documentary 2 analyses Filed10 24 13 Document531 and 17 into secure 18 financial 19 Companies thus 20 the place that labor markets long term do not behave relationships loyalty fairness and internal equity Dr commodity markets Rather labor like on built trust understanding and mutual Court of District Leamer Rep external to Dr Leamer 102 As explained would or internal conditions If workers were commodities every lead to recontracting separation or District and disruption and insecurity for employer States employee Id Thus both employers and employees seek ways to turn the market transaction Northern United the For long term attempt work One 21 can the mission of the organization to of which relationships to create as appealing as loyalty come either from or from jointly by getting possible Id commitment emotional or owned firm specific assets Id buyin from the firm s mission and by making 103 foundation of employee loyalty is a feeling of fairness that can translate into a sharing a firm s rewards with more produce 104 Id 22 of 23 Firms seek to promote a feeling of fairness among employees 24 employees commitment and contentment which also leads to higher levels of productivity 25 Leamer Suppl 26 a firm to 27 another Rep anticipate 16 Dr equality Leamer than a market might otherwise explained rather than to react to outside that to to maintain or to increase maintain loyalty opportunities since firm at a much higher level of compensation coworkers left if it is a worker usually better for were to move to behind might feel they have 28 56 Case No 11 CV 02509 LHK ORDER GRANTING PLAINTIFFS SUPPLEMENTAL MOTION FOR CLASS CERTIFICATION Case5 11 cv 02509 LHK 1 not been 2 productivity compensated That can have an adverse fairly and increasing interest Dr Leamer 3 a by management stimulate 5 the cold 6 outside 7 competitive threat 8 move 9 employees Leamer Suppl Rep response call As in Dr Leamer to this similar individuals that threat by an increase 15 by an beyond and management in compensation Even though 11 improvements can minimize 12 employee discovers 13 as well as just the threat of 14 Dr Leamer 15 that are tied to informationprovided 16 by 17 bursts of cold 18 equity individual 19 Reply Rep until the disruption to they actually employee may to Rep attractive similar a rise in offer outside loyalty that might occur was undercompensated Leamer received make a preemptive mandate not an receive who also of the implicit wise it an of newly threatened for these concerns that would spread the impact throughout for these similar individuals aware may feel 105 offer or a cold call could the specific the market compensation the she outside may make management 10 California Rep when management becomes aware explained 86 of on worker loyalty reducing effect conveyed that could extend for one individual opportunity Page57 employment elsewhere Leamer opined that the information 4 against Filed10 24 13 Document531 preemptive when an c oldc alling 105 Thus Court of District opined that c oldc alling puts upward a broad preemptive response is pressure on compensation 106 Id completely analogous to salary increases District by employment services the compensation regarding offered States the market Rep Leamer Suppl 15 Essentially Dr Leamer opined that the response to Northern United the For calls and even more the response to the threat of cold calls the Technical would Class raise internal Leamer Suppl 27 20 In further support 21 Defendants compensation data 22 each employed 23 high level management 24 for individual variation 25 compensation levels with the goals 26 same employment category 27 different 28 maintaining employee productivity of his opinion company wide Leamer relied on documentary evidence showed This documentary compensation structures that included established Id Dr Leamer grades and ranges of salaries for grades and titles which 12122 of Defendants also established 1 providing 2 providing hierarchically ordered Dr evidence specific relative compensation and contentment 3 retaining See id that Defendants titles left little No scope levels for employees in employees and 122 11 CV 02509 LHK ORDER GRANTING PLAINTIFFS SUPPLEMENTAL that for all employees in the 57 Case and and regularly updated similar compensation employment categories including MOTION FOR CLASS CERTIFICATION 4 Case5 11 cv 02509 LHK Dr Leamer 1 Filed10 24 13 Document531 economic looked to standard Page58 labor theory and statistical of 86 analyses as additional 2 evidence that the anti solicitation agreements would broadly affect members of the Technical 3 Class 4 data and to apportion 5 Reply He explained that his Rep 6 report Dr Leamer and compensation data 7 salary structures 8 Factors 9 Analyses assessed Analyses Rep See Leamer Defendants 10 which 11 California factors between factors in the individual internal and external forces Leamer Suppl 29 In his first expert 12 explained by 13 title 14 titles was approximately 90 percent total common these common task is to identify the statistical compensation common to which time over in any individual Common Factors and the formulaic way structures 128 Id Dr Leamer s Dr Leamer s Common Specifically firmwide compensation varied based on Defendants regression analyses the Court referred as 11 14 Figs of the variation factors conducted According to in Dr Leamer employee s compensation can be company gender such as age number of months in the location Court of District and employer explain Id see a large fraction also id Figs 11 14 firm wide of the Defendants do not dispute variation in compensation the fact that job Murphy Expert Report District 15 Murphy Rep 16 variability in class 17 variables 18 Defendant 19 fact that the coefficients 92 ECF No 230 Dr Leamer concludes that the fact that nearly all States member compensation at any point time can be explained by in common Northern United the For 20 means there a systematic firms Leamer Rep compensation of class 21 factors such 22 experienced broadly in structure 130 to Dr Leamer opined that these to move together employees consistent with important 25 practices 26 base salaries and 27 the ten major job titles at 28 to these five charts 134 Dr Leamer as wage structures over time and in response opined that the evidence showed 24 total each of the would be expected to No the common to be elements of equity specifically relied compensation the across Defendants compensation five charts that depicted for ten major job titles at Apple Google between Dr Leamer s on in a persistent salary structure between changes in the 2006 and 2009 and 2005 and 2009 See id Figs 15 17 The Court Movement Charts Apr 5 Class Cert Order Compensation 58 Case and Id Dr Leamer Id rigid at over time suggested that did not vary substantially his regressions members tended employee compensation that the effects of the anti solicitation agreements Second 23 was 11 CV 02509 LHK ORDER GRANTING PLAINTIFFS SUPPLEMENTAL MOTION FOR CLASS CERTIFICATION referred Case5 11 cv 02509 LHK 36 Dr Leamer contended Filed10 24 13 Document531 1 at 2 different positions 3 did account executives 4 that the anti solicitation 5 broader effects because of a desire on Defendants 6 Third 8 some 9 Leamer 11 offered further evidence that compensation e i over time together See Leamer Rep 13334 if software engineers Based on this evidence for a raise so received Dr Leamer agreements that focused on subsets of workers would nonetheless general Rep Dr Leamer used part to maintain the overall a regression model impact on the Class and to quantify Figs 20 24 Regression analysis 1 age sex and This model 3 the and 12 solicitation agreements 13 revenue total 14 estimate the average or net Fig 22 and show the total to which company years at the to opined have Id salary structure 2 the the anti solicitation agreements had that amount of that impact the Court previously a range of variables incorporated 15 California move to 86 of 134 7 10 tended that these charts Page59 by the Class See Conduct as the account for factors including to on compensation caused by effects effects caused designed referred on the anti to each Defendant factors specific eg firm Court of District number new of hires etc See id Figs 20 23 Dr Leamer under compensation at used the model each firmduring the conspiracy to period See id District 24 Reply at 33 States 16 In the Court s April 5 Class Certification Order the Court stated that a ccepting Northern United the For Common 17 arguendo 18 employee works and what an employee does play a 19 salary 20 establish that this fact 21 for employees with different 22 impact 23 different jobs to that the Apr 5 Class Cert Order at e i 36 However they show that factors such as where that titles would move title would any impact would also found that large role in determining the employee s the Court found that Dr together Dr Leamer did not result ripple across through time such that a detrimental in an impact Leamer s Compensation Movement whether compensation of members of the All Employee Class 26 Texas 27 Compensation 28 Technical at an Movement Intel eg a office in California moved together Chart included Class at two companies to other employees in entirely the entire salary structure 25 and an engineer only twenty job titles Id Charts shed custodian at an No primarily Intel companies 11 CV 02509 LHK MOTION FOR CLASS CERTIFICATION on office in job titles from the out of the thousands of job titles at the seven ORDER GRANTING PLAINTIFFS SUPPLEMENTAL little light over time because the 59 Case an implied that Defendants salary structures were so rigid that compensation an employee with one job The Court 24 Analyses are accurate Factors Case5 11 cv 02509 LHK Id 36 38 1 included in the classes 2 reflected on 3 See id 4 evidence regarding 5 that the allegedly parallel 6 wage structure Brown Decl 7 the chart were 36 38 at at movement Ex showing 9 in the absence that Defendants total Dr Leamer s 11 of 12 Court rejected Defendants contentions 13 discusses 14 damages 15 California Apr 5 Regression analysis Class Cert Order at 38 The Court Dr Leamer Conduct Regression had non rigid Id at was capable analysis less than they showing 39 42 of would have been damages classwide Regression was capable impact on class a general to the contrary a admitted 283 23 25 at further found that the Conduct that the anti solicitation agreements of all Class members also consistent with of anti solicitation agreements and thus capable of 10 showing was on compensation was expenditures positions did not provide particularly compelling reflected in the charts Depo 86 that the twenty each company were linked because 1 Leamer Finally the Court found that 8 at of movement of the compensation also found that these charts whether salaries Page60 The Court expressed concern not representative The Court Filed10 24 13 Document531 In this members Id The Order the Court Court of District Conduct Regression primarily for the analysis s However the Court also notes as it utility in demonstrating classwide order that the Conduct did in its previous District is also capable of demonstrating a general classwide impact States 16 In response to the Court s concerns that the extant could not show a analyses statistical Northern United the For wage 17 rigid 18 expert 19 somewhat 20 a 21 analysis 22 compensation 23 Suppl rigid Dr Leamer structure new report These rigid wage on wage structure a structure that compared 4 emphasis omitted how 25 stating that this correlation 26 Leamer conducted 27 presented 28 Leamer had closely at least Dr Leamer different variables the correlation 22 move together Id Leamer Suppl a Leamer performed equivalent Rep statistical 4 not Class Leamer co movement the twenty This included threshold analysis to measure see also Suppl Reply at 4 of the just No all titles which included that charts for which 94 Dr Dr Leamer Dr of Class Period 11 CV 02509 LHK ORDER GRANTING PLAINTIFFS SUPPLEMENTAL such a correlation 60 Case a of the average of the firm s Technical analysis for all job titles six observations Dr looked to the correlation analysis is the quantitative his initial report his supplemental movement over time the of each title with the average compensation statistically in not only within job titles but also that Defendants maintained across job titles To demonstrate this 24 analyses statistical focused on demonstrating that Defendants maintained analyses job titlebyjobtitle basis Rep in submitted additional MOTION FOR CLASS CERTIFICATION Case5 11 cv 02509 LHK 1 2 of compensation 3 The former 4 14 30 He employee years Id Filed10 24 13 Document531 of 86 Id levels and correlations 6 employee job 7 time with the compensation of the overall 8 32 9 was Figs to As such an increase with an increase correlated while the Leamer found by number weighted titles 2 3.16 both Dr With respect changes Id of compensation on longterm movements focuses over time in two dimensions analyzed correlation 5 vast majority that the employee years of of Technical set each firm correlated positively over of Technical firm 11 factors 12 supported an inference 13 Dr Leamer s 14 demonstrated that not only was there a rigid salary structure within 15 analysis In combination Dr with the fact that Leamer contended that this sharing a somewhat of of employee of gains Class job across rigid salary structure titles is driven by common over time further 4 Figs 2 3 See id firm Class employees in that compensation total id that firm See at of each job title within any given compensation 90 at emphasis in original of Technical Class employees in the compensation in the overall 23 correlation on year byyear movements focuses latter 10 California Page61 Accordingly Court of District supplemental analysis bolstered his finding of a rigid because salary structure job which his titles it initial District showed but also that there was a rigid salary structure across job titles States Dr Leamer 16 next presented a multiple model regression for each company designed to Northern United the For 17 detect 18 structure as opposed 19 of a 20 Technical 21 the degree to which the effect number of internal forces to acting on external market forces of explanatory variables Class compensation at compensation on job title a particular increases See 24 29 id compensation One company for the group are shared broadly 23 degree 24 same company 25 and job growth in the San Jose Sunnyvale Santa Clara Metropolitan 26 the possibility of alternative 27 16 28 To to which gains See account for divides measured in later 26 Dr Leamer s id titles the employee the effect of the previous one year are explanations year s model also included for compensation positive relationship was average this at variable No the Class at the variables for the firm s revenue Statistical increases Id the correlation Area to allow for 2728 Dr Leamer also of each decile to the See Leamer Suppl Rep Figs 9 10 11 CV 02509 LHK ORDER GRANTING PLAINTIFFS SUPPLEMENTAL reflects same time Id the 61 Case the effect compensation showing with insufficient data to run the titlebytitle analysis same a rigid compensation shared with other members of the Technical groups into deciles and measures these groups exhibit the variable See id The effect of 25 variable i The model measured 22 The next e member compensation class MOTION FOR CLASS CERTIFICATION mean Case5 11 cv 02509 LHK Dr Leamer 1 within each 3 49 4 or groups that 5 Figs 2 that 11 12 gains Dr The for on a 24 34 42 Fig 1 Intel indicated that the vast regressions 1 that show some bytitle the regression estimated company Id 2 Filed10 24 13 Document531 see 8.18 7 Defendants employees would have been impacted by 8 Moreover 9 basis for job titles with adequate example Figs 6 8 majority an internal sharing that this is consistent with his previous results 17 43 Id of employees fall within titles opinion that non compete the data same time and all See id or almost all agreements Id opined that the fact that gains were shared over time strongly indicated that force rather than only external market forces drove the structure of class Dr Leamer Id 10 member compensation 11 California 86 in different job titles in a subsequent year 6 Dr Leamer of for the titles or groups are shared broadly at the gains are shared with others Leamer contended title Page62 between compensation 12 between firms This finding 13 somewhat 14 structure also demonstrated there is a of job titles within a much firm than there is between his conclusion further reinforced stronger correlation compensation of job that each Defendant titles maintained a Court of District pay rigid Defendants and undermined structure play no role in setting compensation contention that internal forces and pay 65 68 Id District 15 Dr Leamer 16 positively correlate 17 that the 18 data 19 conclusions about 20 17 recognized do that his analyses include outliersjob titles that do not States to the average or do not show sharing over time Id 12 He noted however Northern United the For 21 number total 18 initially their employees Such conclusions were Rep this latter that an title and then divided these up into deciles Leamer attempted to break the firms up into 10 equal years some groups ended up being larger than others Dr 28 89 hypothesis gains for some of particular employees are highly individualized of an are shared with others rest in Rep 8 internal sharing rather than only external becomes unsupportable when used to year there is not a sensible demand for computers would affect some argue that this contention Plaintiffs Leamer Suppl the existence Leamer Suppl Rep 43 n8 Defendants expert Dr Murphy that the level of compensation of Defendants result is particularly significant alternative employees in one year and the concerns market the next in without a subsequent resort to internal forces Furthermore the sharing force driving the structure of gains of class such as fairness over time strongly indicates member compensation forces 62 Case No by over the lifetime of the Although reason that an external force such as increased 27 also supported broadly determined by competition in a vast labor market for similar employees and is why undermine his basic by splitting the Technical Class titles into deciles Dr groups he ranked titles on the basis of average inflation the ten that adjustments for unique circumstances explain outliers did not were more populous than others argue that contended Murphy 26 titles few the outliers involved titles with incomplete regressions equal based on employee because some employees 25 compensation in most cases the presence of a Defendants paid based on employee years Plaintiffs 24 how Dr Leamer also estimated Leamer explains that to form sized groups 23 was small and 12 50 64 Thus See id adjusted 22 of outliers 11 CV 02509 LHK ORDER GRANTING PLAINTIFFS SUPPLEMENTAL MOTION FOR CLASS CERTIFICATION Case5 11 cv 02509 LHK Filed10 24 13 Document531 1 economic theory and 2 that 3 been harmed by the anti solicitation agreements he had 4 any evidence not seen Ultimately Dr Leamer that economic theory and 6 solicitation agreements artificially 7 Technical statistical 8 64 Importantly of 86 Dr Leamer also contended Class would not have of the titles within the Technical Id common proof in the methodologies were capable Rep Leamer any concluded that 5 Class See id record the evidentiary Page63 suppressed compensation of form of documents data of demonstrating that the anti all or nearly all members of the 149 Dr Hallock s ii Opinions Based on Defendants Testimony Contemporaneous Documents and Data 9 of Class Certification In further support present Plaintiffs a second expert report from Dr 10 Kevin F Hallock labor economist a leading and an expert in compensation structure and design 11 See Hallock California 1 3 Dr Hallock Rep whether Defendants used formal administrative investigated 12 Court of pay systems and whether compensation District agreements at issue would have suppressed the the anti solicitation 13 of all or nearly all members of the Technical Class In forming his opinions Dr 14 District Hallock reviewed only commonevidence Defendants testimony contemporaneous documents 15 States and data Suppl Class Cert Mot at 2 16 Northern Dr Hallock United the found that Defendants all used formalized compensation systems that 17 organized employees into pay ranges grades or families under umbrella systems Hallock For Rep 18 45 In finding that all Defendants utilized formalized pay systemsDr Hallock relied on 19 evidence that among other things 1 Defendants sorted their employees into job families andor 20 2 Defendants grades utilized salary ranges with a minimum midpoint and maximum set based 21 on external employment market data and 3 Defendants used internal tools to assist managers 22 with setting other employees compensation levels See id 45 109 23 An important feature of these formal systems is that job titles levels and grades are valued 24 relative to all other employee categories in the company Employees who receive compensation 25 outside ranges are identified and corrected of their guideline to bring them in line with the 26 company structure 27 ratios between See eg a person and id 114 140 160 166 181 someone else who is According similarly situated to diverge Dr Hallock from each other 28 63 Case No 11 CV 02509 LHK ORDER GRANTING PLAINTIFFS SUPPLEMENTAL if MOTION FOR CLASS CERTIFICATION the the Case5 11 cv 02509 LHK 1 2 3 Filed10 24 13 Document531 86 of person will experience reactions of unfairness and inequity thus making internal equity important not only in setting up the original structure of a compensation managing it Id 110 Dr Hallock 4 internal quotation employees in systematic 6 decisions 7 compensation 8 employees 9 solicitation were made and structured company ways used their compensation system Dr Hallock found that nearly wide on an annual basis and When relationships Defendants made such as to make counteroffers 11 situated and similarly performing employees were also found that Defendants adhered to principles a fashion that preserves retain certain Dr into account whereby similarly 11181 See id Given Defendants formalized pay structures and compensation existing of a competitor s light of internal equity paid similarly their compensation all take the exceptions to pay to cycle adjustments to bonuses in Defendants were careful to adjust the system Hallock in out of or pay retention 10 12 system but also when marks omitted also found that Defendants 5 California Page64 design as well as issues of Court of equity 14 Hallock 16 call or if the 17 were disrupted Id 18 lowered 19 noted that Defendants employed certain 20 top employees Id 21 employees and therefore lowered 22 that the entire Dr agreements would have a widespread and systematic 15 District 13 and fairness present in the Defendant firms Hallock opined that the anti solicitation impact on compensation 237 Id First Dr District a direct opined that impact on pay could occur if an employee did not receive a cold States upward wage on any pressures of the employees in related groups or job families Northern United the For at For example Defendants for nearly 239 elite employees and the top of the 25 Croner See id 26 and other behavior of 27 structure 28 absence of such agreements To the extent firmsDr lower and their hence their data to external found that own that cold that employees No nearly all other these wages as there is sources most commonly at other firms through the market data they opined workers Id use for Radford or anti competitive their own pay levels will be lower than they would be in the Id 11 CV 02509 LHK ORDER GRANTING PLAINTIFFS SUPPLEMENTAL Dr Hallock range Hallock 64 Case pay could be calling often targeted data could influence that pay is lowered Hallock one way in terms of the salary as well thus impacting evidence that Defendants benchmark that agreements suppressed salaries of these top box also opined that external market 240 hypothesized has to do with extraordinary Since the anti solicitation 24 will be Dr Hallock workers all box may be lowered Dr Hallock 23 238 MOTION FOR CLASS CERTIFICATION Case5 11 cv 02509 LHK 1 Finally in support Filed10 24 13 of Plaintiffs Technical Page65 Class definition Document531 Dr Hallock of 86 examined 2 Defendants pay 3 concluded that the same mechanisms that would have transmitted 4 Defendants 5 anti solicitation agreements suppressed the pay of certain members of the Technical 6 nearly all other firms apply with even c 8 The to Defendants argue that this Court should not individualized who was inquiries regarding Defendants contend that 11 wide 12 different managers 13 As such 14 of all other employees in the Technical variation in their who According were directed the Technical if Class See Suppl Mot the the at 3 Contentions Class because over common compensation was to Defendants or all questions and practices were highly individualized differentiate to 246 Thus employees Id impacted will predominate compensation policies compensation pay suppression throughout and Defendants certify Class and the Technical to have also been impacted Court s Conclusions 10 California design as they pertain greater force to technical members would be expected 7 9 and compensation structures set with by hundreds of pay and reward high achieving employees Court of District Defendants argue that pay raises to one employee would not necessarily affect the salary Class District 15 In furtherance of their contention that individualized issues predominate Defendants States 16 contend that the individual 17 discussed 18 internal files Northern United the For 19 pieces of evidence offered below Defendants cannot and rebut the voluminous First the Court finds as it did previously 20 internal equity 21 solicitation agreements suppressed compensation 22 While Defendants 23 relied 24 Leamer s hypothesis 25 192 25 193 6 194 10 196 10 197 7 19 hypotheses offer theories subject Dr Murphy did Dr Murphy not See dispute initial 27 other goals such as procedural 28 loyalty motivator report because see that to Dr broadly principles it Murphy evidence from Defendants See Apr 5 Ex Similarly although upon which economics No 13 Murphy Depo 21 Dr Leamer at Dr 188 6 14 Dr Murphy criticized Dr Leamer s of maintaining internal equity contributions the Court does not find that this undermines 11 CV 02509 LHK ORDER GRANTING PLAINTIFFS SUPPLEMENTAL at undergirding 65 Case anti Class Cert Order literature of information 297 how Defendants equity or the value of rewards for individual 81 as evidence proof for did not compare the importance Rep However Leamer s market price discovery and criticized the economic the basic are unpersuasive documentary common eg Harvey Decl ECF No 26 expert Plaintiffs reports that rely on this documentary the expert expert by MOTION FOR CLASS CERTIFICATION to as a Dr Leamer s Case5 11 cv 02509 LHK 1 hypothesis 2 particularly true in light 3 Filed10 24 13 Document531 played some role 86 of employment compensation internal equity that internal equity Second 4 of the extensive affecting in the Court finds that Plaintiffs documentary method impact Indeed support 6 evidence 7 the actual 8 new 9 evidence significantly bolsters Plaintiffs showing that for Plaintiffs is likely to of proving be among the most persuasive dynamics at play within evidence as common 11 valued internal equity 12 indicates 13 internal equity 14 Defendants utilized software 15 employee to 16 consideration 17 compensation 18 evidence provides point is substantial further trial the Court predicts that this at jury as it see Suppl Opp n at 13 method their and confirms many illustrates Defendants firms While Defendants mostly old and off 10 a to This evidence showing that Defendants valued documentary 5 California Page66 characterize of Plaintiffs the Court finds that this of proving impact will turn on make adjustments as necessary evidence For example rather than a few documents compensation in their practices that all Defendants valued internal equity showing some Defendants that evidence Plaintiffs documentary now Further the evidence now suggests that Court of District was such an important aspect of Defendants compensation tools to generate internal equity reports 2 Defendants advised managers and 1 practices that to compare each District his or her peers that internal equity was a prime States when setting and adjusting salaries and Northern United the For 19 structure Despite this when documentary and evidence discretion 21 Defendants 22 documents 23 that although 24 and long term high performer differentiation 25 Indeed refer as indicate Intel pay for c ompensation notes that 27 to distinguish 28 increases at lack over internal equity For example in a 2004 differentiation is desired is Human by valued performanceto presentation Decl Ex 10 v ulnerability c hallenges merit increases Intel identifies are significantly term threat to retention of key players 2 1 m anagers No states short at 13 little to no actual pay 11 CV 02509 LHK ORDER GRANTING PLAINTIFFS SUPPLEMENTAL in ability reduced from system generated 66 Case Intel Meritocracy philosophy Harvey Suppl questionable which However Defendants Resources Intel s broad exercised of differentiation has existed focal actual long salaries and that Defendants performance otherwise Id at 19 As key 26 adjusting their and groups and to titles Defendants contend that managers 20 setting monitored actively within and beyond job identify discrepancies to 3 Defendants MOTION FOR CLASS CERTIFICATION Case5 11 cv 02509 LHK 1 differentiation for 2 3 Page67 n o explicit strategy of 86 differentiate Id 24 emphasis added 3 and Further the documentary such differentiation 5 a 6 position the lower the merit increase 7 that 8 strong 9 employee whose from Google shows chart tries it to manage performers with not inconsistent is who that for a given Dr Leamer s See eg high the higher 1609.9 documents 10 than an employee whose salary exceeds 11 performance 12 performance based pay and concerns Ex the target even a larger percentage receive noting very to show that an pay increase though both employees receive 1855.107 This demonstrates exists pre adjustment the Google at For example Google s documents Specifically would the target salary review See Cisneros performance range and thus give minimal increases are paid relatively below Ex Cisneros salaries in the salary is for theories of internal equity of performance level to pay evidence indicates that even where 4 California Filed10 24 13 Document531 the coexistence the same of of internal equity Court of To 14 principally 15 compensation 16 District 13 declarations 17 and accordingly 18 re Wells pay contend that they valued on for performance over from top management declarations in their internal equity Defendants rely human resources recruitment District However and benefits departments the Court has already recognized that these States were drafted for the specific purpose of opposing Plaintiffs class motion certification Northern United the For 19 the Court finds that these documents are of F Supp Fargo Home Mortg Overtime Pay Litig 527 scrutinizing carefully declarations 20 Indeed many of 21 obtained 22 example 23 Mason 24 salary bands 25 in his deposition 26 diametrically 27 company 28 numbers of from Defendants in a made the claims declaration Stubblefield Intuit or ranges after after from Defendants created either for existing on opposite position when Each we levels job that have of he stated that fits with the discovery stated new hires within a band Jobs on bands are fit business Intuit Stubblefield motion Mason t here get used in different job families based that into levels needs No took the Intuit inside the And different Stubblefield 11 CV 02509 LHK ORDER GRANTING PLAINTIFFS SUPPLEMENTAL 10 Yet Decl 67 Case motion does not use Stubblefield at Plaintiffs motion For the initial class certification Human Resources the class certification driven litigation Plaintiffs initial class certification employees or Cf In value ND Cal 2007 2d 1053 1061 are inconsistent for the purposes of opposing Vice President the hearing on probative employees that appeared in those declarations the hearing a diminished MOTION FOR CLASS CERTIFICATION Depo Case5 11 cv 02509 LHK 1 87 8 8824 2 internal documents 3 CEOtoCEO emails presentations 4 Defendants human 5 concerns 6 is litigation of these demonstrated In light Defendants created resources compensation regarding 86 more persuaded by and recruitment agreements from and interoffice communications the such as the heads of about internal equity class certification and testimony that driven 8 Defendants maintained 9 maintain a subjective evaluations 11 Hallock s top of the 12 that b ased Dr Shaw s report to rebut Plaintiffs contentions formalized compensation pay for performance 10 California of before and during the anti solicitation Defendants created to oppose than the declarations Page68 the Court is inconsistencies departments Defendants further rely on 7 Filed10 24 13 Document531 box theory on Defendants by philosophy implemented employees Shaw of is opines that Defendants managers individual 16 Dr Shaw Rep based on further contends that Dr 41 42 54 62 66 Dr Shaw See id unsupportable compensation Dr Shaw structures that systemspay practices opines and pay philosophy she Court of District 13 14 would not expect that a suppression Class members Id Technical at of wages to some employees would affect all or nearly all 27 District The Court 15 finds Dr Shaw s criticisms of Plaintiffs theories and of Dr Hallock s report States Dr Shaw s 16 unpersuasive 17 record 18 class certification even 19 Defendants own 20 Shaw App 21 emphasizes managers broad discretion 22 investigate 23 Dr Shaw 24 difference 25 9814 15 Dr Shaw 26 are 27 Rep 28 to the extensive report is conclusory and contrary to the overwhelming evidence in the Northern United the For For example C Dr Shaw though internal relies many heavily on the declarations Defendants created of the claims in those declarations documents See id at 20 21 n25 in whether Defendants supervised setting compensation and controlled their 19 to mere guidelines 30 However for managers and documentary Dr Shaw s evidence discussed managers use No made any significant is emphasis on managerial above which to job codes highly individualized suggests discretion that the exercise 11 CV 02509 LHK ORDER GRANTING PLAINTIFFS SUPPLEMENTAL and of discretion 68 Case Dr Shaw did not systematically based firms pay ranges assigned that the pay of workers the Court finds that n35 23 Ex O Shaw Depo 74 1 7516 93 1622 employee pay See Shaver Suppl Decl also asserts that in technology n32 and Further although Dr Shaw admits that she did not assess whether managerial discretion with are inconsistent n26 21 n30 1 2 3 4 7 8 10 11 18 24 Shaw App D to oppose MOTION FOR CLASS CERTIFICATION See Shaw is contrary of any Case5 11 cv 02509 LHK was 1 discretion 2 compensation 3 Depo 4 to pull in a bunch 5 Keiper Depo 6 had minimum for 7 nature 8 show 9 Suppl Reply a in 24 Adobe admonished at reason a 19 97 are contrary of class Rep Dr Shaw s from Defendants to deviate g Cisneros Decl Ex N Fadell would have range id Ex C of that Arriada from salary ranges that Adobe deviated contentions regarding member employee years pay was within the individualized Dr Leamer which by analysis provided to the statistical 86 range Apple managers salary managers who of range the prescribed Leamer 31 67 principal contentions 11 analyses 12 and Defendants expert 13 is 14 impact 15 California IVB2aii see e Moreover Page69 authorization of people to then approve anything outside Defendants 10 to obtain from a prescribed stating that to deviate of compensation that had that managers See supra section structure 53 at and limited Filed10 24 13 Document531 considered however are challenges Before the Court turns to an analysis of the competing Dr Murphy to Dr Leamer s methodologies the Court notes that the importance statistical of Dr Leamer of these statistical models Court of District diminished in light of the extensive In other contexts courts documentary evidence that supports have long noted that statistical Plaintiffs theory and anecdotal of evidence must be District in tandem See Coral Const Co v King Cnty 941 F2d 910 919 9th Cir 1991 States T he combination 16 Northern United the For of convincing 17 not identify a case 18 have presented 19 experimental data needs 20 persuasive 21 the documents at statistical evidence is potent the class certification stage with the level of documentary The Court agrees with in the instant case to be from conclusions to and anecdotal sensitive to Dr Leamer in which the context that the data This Court could evidence Plaintiffs interpretation of non were generated and the numerical data require the information in the numerical data and be aligned Leamer Suppl Rebuttal Rep 11 After all class certification 22 23 19 24 25 26 27 for failure to strike Dr to provide Leamer s reliable U report in support of Plaintiffs initial motion for class relevant and admissible testimony under Daubert Dow Pharmaceutical 509 S 579 1993 Evidence Defs Mot to Strike Rep of Dr Edward Merrell and Rule 702 of the Federal v Rules of E Leamer Mot to Strike ECF No 210 The Court rejected Defendants motion in its April 5 Class Certification Order See Apr 5 Class Cert Order at 49 50 While the Court has concerns about the probativeness of some of Dr Leamer s flawed 28 moved Defendants certification statistical Certification by evidence as to warrant or In their Opposition to the Supplemental any new Daubert Dr Hallock See Suppl Opp n Defendants do not Dr Leamer the Court does not find this evidence is so methodologically exclusion raise challenges Motion for Class to the expert opinions 69 Case No 11 CV 02509 LHK ORDER GRANTING PLAINTIFFS SUPPLEMENTAL MOTION FOR CLASS CERTIFICATION set forth Case5 11 cv 02509 LHK 1 requires a holistic qualitative assessment 2 analysis is not bean counting The Court now 3 4 unpersuasive 5 correlation 6 Dr Leamer s 7 statistical 8 render dubious 9 id at and multiple 12 11 do not 12 light 13 discussed Defendants F3d show contentions that Dr Leamer s conclusion finds that several Dr Leamer s 1 averaging because suggest that Dr Leamer s of the extensive statistical documentary 13 14 are in his issues individualized 2 3 Dr Leamer s Defendants argue that these flaws a rigid are contrary wage structure own to their Defendants remaining the Court finds that analyses methodologies problem and Defendants arguments Moreover and methodologies masks that Defendants maintained of the class certification should not have relied on averages Suppl Opp n causation noted 86 of 801 at Dr Leamer regression analyses Page70 Circuit has regression analysis is faulty due to an endogeneity The Court documents as the Seventh Butler 727 Defendants contend that evidence cannot 10 California turns to Filed10 24 13 Document531 should be rejected wholesale See internal contentions particularly in Dr Leamer s conclusions Thus and accepts evidence that supports Dr Leamer s methodology as Court of District below the Court rejects Defendants primary 14 Defendants contentions Dr Leamer s criticisms of supplemental report turn on his use of District 15 averaging in his correlation 16 take issue with 17 analyzes 18 compensation and multiple regression See Suppl Opp n at analyses 12 Defendants States Dr Leamer s use of averages in his job titlebyjob title correlation analysis which Northern United the For 19 movement over time the of the average compensation of the firm s Technical b y averaging the compensation of all employees who Dr Leamer necessarily wipes out the very thing he 21 significant variation in individual employees compensation 22 Defendants 23 whether 24 over time and whether their 25 Defendants also object to 26 models designed 27 member compensation 28 Specifically all correlation of averages employees with the same job to detect compensation Dr title moved the or fall into the 5 at According No e i Leamer s multiple a company wage forces specific structure See id regression analysis multiple acting at on Id at masks MOTION FOR CLASS CERTIFICATION 6 regression class 5 6 11 13 11 CV 02509 LHK ORDER GRANTING PLAINTIFFS SUPPLEMENTAL to regardless of directions 70 Case same be measuring the same conclusion or in opposite his in to merely external market Dr to Suppl Opp n in lockstep the effects of internal forces Defendants claim that supposed title identical or vastly different compensation Leamer s use of averages as opposed is would reach received Defendants contend that hold the same job decile Leamer s 4 Class Leamer Suppl Rep 20 Dr of each title with the average individual Case5 11 cv 02509 LHK 1 2 Id by using average job variation at title However 86 of compensation data rather than individual that in the context 5 Plaintiffs theory that there is a 6 supplemental 7 signal of the internal 8 32 Dr Murphy admits that 9 reasons 10 do 11 averaged the averaging and multiple of the correlation report that given by Dr Leamer s the Court finds that 4 data Leamer data is Decl Ex N Shaver so that you are are trying to aggregate left Dr structure detect an are consistent with Leamer notes in his rebuttal level data tends to in the individual Plaintiffs averaging regression analyses wage rigid the inherent noise pay structure Dr is somewhat averaging of the data appears to yield results Leamer Suppl appropriate Murphy with a more systematic drown out the Rebuttal Rep tool for the statistical Depo 553 18 20 same The reason you part and the idiosyncratic parts get out With 12 compensation Page71 13 3 California Filed10 24 13 Document531 to both correlation respect and multiple regression Dr Leamer analyses averaged the Court of 14 averaging 15 necessary to determine whether there was a wage structure across job 16 District compensation 9711 22 106 5 13.20 17 analysis for the purposes of 18 Analysis shows that approximately 90 percent 19 common factors 20 individual 21 Analysis of employees within each job title may have masked some of the individual variations 18 29 Rep Leamer Suppl 13 each job within While title it this kind of was District See titles Aug 8 Tr at States Northern United the For The Court showing primarily compensation is therefore not persuaded that is by job a wage title structure job titles of each employee s Rep Leamer by primarily determined which was run on an employee across should disregard the correlation it 128 job title byemployee basis Common compensation Aug as The 8 Tr at shown by explained by 105 10 24 the Because Common averaging without is Factors see Factors Leamer 22 20 23 Dr Leamer because explains individual 24 in his supplemental data is likely to level which can make it be dominated by forces difficult to detect individuals 26 in a title can average out the individual wide more transparent In addition on the compensation structures effects perspective Defendants used 27 to maintain their many that operate title the firms Averaging effects averages at the individual the firmwide effects including of the anti cold calling agreements broadly across 25 work with report that he chose to the spread across thus making the firm a titlelevel analysis provides the documentary a clearer evidence shows employees and maintain internal equity among their employees 28 Leamer Suppl Rep 19 71 Case No 11 CV 02509 LHK ORDER GRANTING PLAINTIFFS SUPPLEMENTAL MOTION FOR CLASS CERTIFICATION Rep Case5 11 cv 02509 LHK Filed10 24 13 Document531 1 128 Fig 11 and 2 job move 3 that there is a 4 resulted in 5 conclusions 6 evidence that suggests that Defendants maintained 7 of 86 equity titles 9 together the Court believes wage structure an impact in and multiple the correlation the to all or nearly all contention particularly unconvincing regression that Dr Leamer s that averaging budget and compared 11 compensation within the company 12 Depo 44 12 20 13 bonus to it to further notes that across a formal wage Google Senior Vice Dr Leamer s matched is job title companies See multiple analyses often aggregated their entire the budgets of other firms or President and valued internal structure rendered unpersuasive similar titles across Dr Leamer s are consistent with the documentary analyses that Defendants themselves considering compensation that compensation analysis bolsters Plaintiffs theory employees The Court and correlation 10 show analyses under which an impact on some employees would have in place Common Factors Defendants 8 California Page72 of People Operations eg Bock testifying that Google s Court of District amounts were 14 by calculated people because All those a set of people in like jobs taking they re in like jobs will have you calculate the same the The District 15 on will be based the on rather than their States 16 see also Shaver Decl Ex 122 email from Lori McAdams Pixar Vice President of Northern United the For 17 Human 18 Director 19 07 and Resources of and Administration Human Resources among stating Ours but is Coker former Lucasfilm Sharon it 21 Adobe uses aggregated and average 22 then uses in developing its Defendants further own criticize Dr 24 basis Defendants contend that 25 levels and changes in individual 26 examines variation at the individual 27 compensation 28 these results show that is Streeter Leamer for job titles supplemental ignores data that employees compensation employee level and wrong who Depo at and and Senior budget for Are you doing 46 47 discussing classifications start expert shows report substantial No finds substantial to infer that an increase title another variation which it similar in the divergence in Defendants argue that in compensation for some employees 11 CV 02509 LHK ORDER GRANTING PLAINTIFFS SUPPLEMENTAL how Dr Leamer Dr Murphy In contrast to with the same job on 72 Case FY structure Dr Leamer s over time for individuals it F data from Radford compensation on average closer to less Cisneros Decl Ex anything close more or Director others asking about others salary increase we may manage 20 23 to MOTION FOR CLASS CERTIFICATION Case5 11 cv 02509 LHK 1 would 2 results reflect 3 Filed10 24 13 Document531 86 of B result in an impact managerial However 4 to all or nearly all discretion that Defendants 5 that the Defendants maintained 6 as discussed 7 for 8 Cisneros Decl 9 employee compensated above Opp n Ex 1609 at 10 differentiated is pay is with not inconsistent not inconsistent Dr App Leamer s finding Indeed such as based on a with theories of internal equity of Google s that a high performance target salary having higher percentage than an individual 11 Google s target salary For example Google notes that 12 Rep Exs 2 3 Rebuttal the notion that differentiation Google Chart showing at Murphy citing that the compensation structures that restrained that differentiation the evidence supports performance philosophy employees Rather Defendants contend 10 California Page73 range and thus give minimal increases to very strong eg rating will result his her salary increased with the same rating but compensated it See tries to manage performers who pay in an by a at a level higher than salaries in the are paid relatively Court of high Id 14 performance 15 District 13 Google see also Cisneros Decl Ex 1855.107 based compensation is showing that managerial not necessarily inconsistent and discretion with principles of internal equity at District States Second Defendants contend 16 that Dr Leamer s multiple regression analysis is unpersuasive Northern United the For 17 because 18 it arises suffers from an endogeneity problem Suppl Opp n when some of the common same unmeasured Murphy Suppl Rep 43 19 dependent 20 San Jose Sunnyvale Santa Clara Metropolitan 21 variables affect 22 internal variables both average job title 23 13 24 improperly concludes that the 25 compensation 26 fundamental 27 unsound Defendants argue that by while the ignoring Dr Leamer s the dependent the independent not variable among his variables Suppl Opp n Dr Leamer Id Defendants contend model uninformative and title that this is a his inferences Id 28 73 Case No 11 CV 02509 LHK ORDER GRANTING PLAINTIFFS SUPPLEMENTAL external variable and Leamer s meaningfully explains average job external variable does error that renders Dr Leamer s and Area variable and unnamed omitted endogeneity internal variable problem endogeneity factors drive both the independent Statistical variable this 13 An Defendants argue that compensation firm wide average compensation at MOTION FOR CLASS CERTIFICATION from it at Case5 11 cv 02509 LHK The Court 1 not persuaded by is Filed10 24 13 Document531 concern With this respect show 2 Defendants have not provided quantitative 3 skews 4 Defendants offer the endogeneity theory without any support 5 law 6 variables that Defendants 7 Defendants have not 8 change 9 Murphy 10 12 with respect A similar lack contend cause identif ied a Suppl Reply the results has to the internal this 9 see not presented any analysis for the positive endogeneity in the form of data problem showing sharing or in that omitted Dr Dr Leamer s underlying Plaintiffs theory of classwide respect variable analysis or case to the Specifically show n how Leamer Suppl also Finally Defendants argue that causation San Jose variable San Jose employment the that 86 of firm wide average compensation variable Rather single omitted variable at to the Defendants argument with of specificity plagues effects are responsible 11 California the results analysis to Page74 Rebuttal note as Plaintiffs adding one would Rep non sharing unknown 61 noting external that Dr or internal Leamer s results analyses cannot address the question impact which Defendants of characterize as Court of 13 whether compensation 14 would cause a 15 contend that Plaintiffs 16 District wage for class depression 17 agreements would have been 18 simultaneous 19 evidence 20 individual 21 compensation increase members was so rigidly interlinked that all Suppl Opp n for substantially at 14 a wage increase for some That is Defendants District have not demonstrated that the antisolicitation agreements caused any States in wages However clarify that that a 5 Plaintiffs Plaintiffs never argued that the impact of the Northern United the For by raise across shielding raises As 22 5 lockstep the firm Suppl raise to Reply at 8 one employee they also avoided having to make across the board the documentary evidence above demonstrates increases Defendants would have had to make structural 25 explaining that a group of Pixar employees base salary needed 26 competing with technology or reactive that they agreements changes See were eg Cisneros Decl Ex VV companies in the getting better offers of Patricia Murray Intel Bay Area and elsewhere at to 106 Sheehy be increased Depo because Pixar was its recruiting team was hearing Leamer Suppl Senior Vice President Rebuttal and Director No 11 CV 02509 LHK ORDER GRANTING PLAINTIFFS SUPPLEMENTAL Rep of Leadership 74 Case to there is compelling evidence that in the preemptive citing deposition preemptive Id 24 28 a employees from waves of recruiting Defendants not only avoided their absence of the anti solicitation candidates required Rather as shown by the documentary 23 27 would have MOTION FOR CLASS CERTIFICATION 23 from Case5 11 cv 02509 LHK 1 Strategy and former President 2 question regarding 3 preemptively prevent 4 globe 5 Dr Leamer s 6 causal 7 Leamer Suppl 8 with Plaintiffs expert 9 Human Resources Page75 of 86 Murray explained a a classwide basis whether would be that methodology 12 and 13 the Court finds that 14 documentary of in attrition was high in the many a we assessed The facts Rep 13 theories and correlation case analyses Defendants arguments by are contradicted and complementary to draw information evidence along on are capable of demonstrating causation any analysis Defendants have not presented Dr criticisms of that undermines the documentary the in Court finds persuasive the compelling documentary Defendants find persuasive somewhere which are routinely used analyze correlations In the instant or job ranges to particular job category supported by compelling frameworks the Court does not 11 many if in response to for particular job categories that economists when in which raised compensation Intel a fact considered Rebuttal sum In of attrition statement conclusions 10 California Filed10 24 13 Document531 Leamer s Dr Leamer s evidence analysis Accordingly Court of District Dr Leamer s evidence is methodology in conjunction with and bolstered sufficient to meet the predominance by with respect standard the extensive to impact District d 15 Conclusion on Impact States 16 Plaintiffs documentary evidence along with the expert reports and statistical analyses that Northern United the For on common members 17 rely 18 individual 19 that Defendants 20 premium on 21 Defendants limited the proportion 22 increases Further the evidence suggests that the Defendants benchmarked 23 structures 24 support Plaintiffs theory that the top companies 25 ceiling based on which 26 This extensive 27 was linked Case No this evidence issues in proving antitrust internal equity concerns issues between structures of each that will predominate supports between would be The documentary evidence and the expert merit reports also set Class s compensation Plaintiffs theory that each technical a was set employee s compensation those of her peers within and across Defendants firms 28 75 11 CV 02509 LHK ORDER GRANTING PLAINTIFFS SUPPLEMENTAL to compensation and top employees at these companies of the Technical a various dedicated their over Plaintiffs theory basis that placed communications Defendants budget or nearly all employees evidence supports on a company wide and that collusive data and to each other all class impact The documentary evidence had formal compensation to external to establish that MOTION FOR CLASS CERTIFICATION Case5 11 cv 02509 LHK 1 have also presented Plaintiffs Filed10 24 13 Document531 documentary and expert Page76 86 of evidence about labor market 2 dynamics that would have affected compensation on a classwide basis For example Defendants 3 would have had steps through bonuses 4 poaching by other Defendants 5 and poaching of employees by increasing compensation 6 from outside 7 equity 8 preemptive 9 classwide effect and would have impacted take preemptive to rigid compensation many of California illustrates 12 the disruption 13 solicitation agreements these theories all including how of internal equity and the evidence suggests of the anti solicitation the significance these dynamics would have had of the Technical non party Google and between of the threat would have internal that any such agreements members or nearly all which concerns interactions 11 in response to the spread of information of the structural concerns regarding structures or reactive steps in the absence One example 10 threats of off Further Defendants would have had to react to any cold calling and within Defendants firms Because and the existing and raises to ward Class Facebook imposed by cold calling in the absence of the anti Court of District 14 March In of prompted Defendants to offer employees incentives to minimize attrition 2008 Arnnon Google Geshuri non party Director discovered that Recruiting District 15 Facebook had been 16 Geshuri s first 17 non party Facebook 18 our 19 we calling into Google s cold SRE team Site Reliability Engineering States response was to suggest Sheryl Sandberg contacting Chief Operating Officer for Northern United the For SRE team and cold will not in an effort to to consider call 20 look ing 21 to consider additional 22 possible SRE 23 aggressive campaign 24 would be unrelenting 25 In into each 26 27 28 President internally and in August of of to establishing other review ing individual Id ask her emphasis after added Intuit Board email the Google Vice President sourcing Not Call agreement Ex 614 SRE group losing one of their stating w to keep attrition folksno No low as holds barred want as an We Id many Co Lead employees executive Director to Facebook Google s Vice management group and of Apple and advisor expressed concern about Facebook s to Bill Campbell Google poaching and 11 CV 02509 LHK ORDER GRANTING PLAINTIFFS SUPPLEMENTAL that may e start 76 Case at also suggested Finally an alternative suggestion was to after directed effort that specifies Arnnon Geshuri or team incentives company and go of Directors Do rate for the incentives Communications emailed Google s Chairman of stop to the targeted a mutual the attrition and a force of nature 2008 a Cisneros Decl retention to call into their put MOTION FOR CLASS CERTIFICATION stated In this that Case5 11 cv 02509 LHK 1 she had 2 gone offered employee the Filed10 24 13 Document531 and different roles discussed his future at she could without making promises about pay or as far as team her Id 3 problems across 4 Sheryl Sandberg or Facebook 5 a truce Id Facebook Page77 title but that she had would cause Who significant refused Facebook continued 6 7 October 9 months new Facebook s 8 Founder Mark from Google Facebook s studying DOJ made public the Zuckerberg Google s employees to poach employees were recruited 2010 Google began after Bill Campbell s 2010 In Leamer of for Rep We example 109 have to get of Accordingly A month Google announced Defendants its in later Id strategy solicitation investigation its should contact to get a cease fire 10 Bang 11 provided 12 email Laszlo Bock 13 rationale for the Big 14 retention because 15 because start ups don t have the cash flow to match and big companies 16 California Google that response was to ask 86 of internal equity 17 and two Big 10 and Ex 48 which involved an increase an immediate to the base salary of all of its salaried employees cash bonus 1,000 to of Google Senior Vice all President employees Shaver Ex 46 Decl of People Operations by In an internal explained that the Court of District 1 being Bang included higher salaries generate responsive higher fixed to rising attrition 3 being costs and 2 supporting higher very strategic District a too are worried about States and scalability to do this b don t and Northern United the For The 18 19 Google s 20 new 21 Recruiting 22 increased Big Bang which hires Apple s compensation internal equity Manager and former Research We will go back for your 23 then created and review issues structure internal equity good talent employees Great 26 its forcing Apple to pay more as follows new proposal review to stay ahead and be competitive close by again and come up with a This 25 employees a Having 10 Ex 1376 these talent does increase we new come comp is due must be aggressive data points at a cost to the market issue with current changing employees with our offers in will help justify adjusting to deal with the aggressive offers out in the Cisneros Decl 28 Apple s subsequent reaction to Google s actions demonstrates the weakness Google s reaction to Facebook s solicitation of In order order to current Google gave Just as a data point 27 its market employees and of Defendants 77 Case No Decl with current employees David Alvarez Manager responded This will most likely create an internal 24 Shaver impacted the other Defendants as well For example salaries within Google disrupted have the margins to do this 11 CV 02509 LHK ORDER GRANTING PLAINTIFFS SUPPLEMENTAL MOTION FOR CLASS CERTIFICATION for Apple Case5 11 cv 02509 LHK 1 contention 2 who would 3 impacted differently depending on 4 reactions of the Defendants 5 widespread that the impact that c alculations damages model supporting a 11 with respect to the alleged 12 citing circumstances individual 86 to individual employees ABA These contemporaneous to genuine competition for labor suggest whether to disputing 10 California their would have been that their response to instead structural rather than individual can show impact on a classwide basis the parties Plaintiffs whether Plaintiffs can show damages on a classwide dispute of Damages In addition 9 agreements was localized of the anti solicitation of their employees solicitation 3 8 Page78 have been solicited but for the agreements or that class members would have been 6 7 Filed10 24 13 Document531 need not be exact anticompetitive of Antitrust consistent with its liability effect of the Law Proving The Supreme Court has held as at trial any the class certification stage at damages case must be plaintiff s Section but basis violation Damages Antitrust Comcast case 133 particularly S Ct at 1433 Legal and Economic 57 Issues Court of 62 2d ed 2010 14 unless damages sought 15 District 13 F3d the words In other a damages cannot be suit to proceed as a class action certified are the result of the class wide injury that the suit alleges Butler 727 District at 799 emphasis in original States Here 16 rely Plaintiffs on expert their Dr Leamer to demonstrate that they can use reliable Northern United the For 17 methods to compute damages by applying classwide methods and analyses 18 22 19 approach could be used to create a model for quantifying 20 members resulting from Defendants 21 percentages by which Defendants undercompensated 22 the conspiracy 23 solicitation agreements 24 agreements were 25 136 Dr 135 48 Dr Leamer Rep Leamer citing years in by contrasting model sex and 26 including 27 28 revenue number of years at the new Technical Dr Leamer before 2 the 3 the effects caused hires etc and by 4 the to Technical This model generated the effect when of the anti the anti solicitation designed to on compensation caused by factors specific effects caused to by No each Defendant the industry See 11 CV 02509 LHK ORDER GRANTING PLAINTIFFS SUPPLEMENTAL Id account for factors 78 Case Class the anti solicitation agreements effects at Class employees in each of estimated after a range of variables company cost during the periods and Mot evidence and a regression 14148 Id their compensation incorporated anti solicitation agreements total Specifically common the estimated challenged conduct with compensation effect Leamer s 1 age Id Fig 24 concluded that See Class Cert MOTION FOR CLASS CERTIFICATION the eg firm id Fig Case5 11 cv 02509 LHK Filed10 24 13 Document531 1 23 Dr Leamer 2 the Technical 3 Defendant firmduring the period 4 Fig 5 solicitation agreements over time and for variations 6 146 7 in a straightforward 8 calculate 24 Reply 33 Dr at 11 model 12 damages Dr the average or net estimate in which the anti solicitation fashion Regression Class Cert Order at See id the effect of the anti in 148 see employees Id also the Court considered but ultimately found the sufficient to satisfy Plaintiffs burden for the purpose of Rule Apr 5 each at employee compensation could be used Class See id 5 Class Certification Order Leamer s Conduct had some impact on agreements were in effect different kinds of of 86 conjunction with Defendants compensation data to in for employees in the Technical April among of under compensation variations for model that this econometric formulaic In the Court s criticisms of to that the anti solicitation agreements Leamer s model accounted contended damages 10 show to Class generally and Dr Leamer 9 California used the model Page79 23 4 id Figs 3 Defendants Conduct Regression b3 on the issue of 43 44 Court of 13 First the Court rejected 14 analysis an sensitivity 15 District variables Defendants exploration of how criticism that sensitive Dr Leamer failed to conduct a a model s conclusions are to a choice of District Leamer Depo at 351 4 6 Dr Defendants argued that Leamer should have performed States 16 disaggregated using only data from that Defendant s for each Defendant analyses employees Northern United the For 17 18 However 99 in light including of the limited compensation the relatively short length of the data period to aggregation may provide 20 statistical 21 Court also was not persuaded by 22 42 Defendant 23 agreements 24 many 25 spreading those effects across a wider range of variables See 26 see period Apr 5 v analysis and yield Corp Costco Wholesale Dr Murphy s more competing 523 disaggregated more meaningful ND Cal 2012 model which Rep App 9A could also Rep because the Court found that Dr Murphy s No The included use of that minimize artificially the effects of the anti solicitation agreements by Apr 5 Class Cert Order at 39 40 101 the Court rejected Defendants Class Cert Order at 40 Mot to criticisms of Strike at 13 Dr Leamer s choice of a benchmark Defendants argued that 79 Case Rep the Court found that reliable and FRD 492 285 Reply variables only 28 of which related to the effect of the anti solicitation Murphy Leamer Reply Second 27 28 specific variables citing Ellis robust Dr Leamer Leamer 2001 2011 19 results a more data available 11 CV 02509 LHK ORDER GRANTING PLAINTIFFS SUPPLEMENTAL MOTION FOR CLASS CERTIFICATION if the Case5 11 cv 02509 LHK Filed10 24 13 Document531 Page80 86 of 1 benchmark period was changed 2 period during which the anti solicitation agreements were in effect 3 this period then the 4 However 5 limited in this 6 data 7 Furthermore the Court expressed concern that in altering the benchmark periods Defendants 8 reduced the 9 result in less accurate was model showed way Apr not comparable amount total 5 Class Cert Order from to data Id results at 12 compensation 13 Murphy 14 the Conduct 15 Class and overcompensation 16 17 reflecting changes 18 companies See Leamer Reply 19 altered the results of 20 should be disregarded a persuaded by Defendants contention to failed to include employees over under compensation non conduct the See id benchmark period should be the show that Defendants did not regarding the pre conduct should be excluded periods which could then argument that the Conduct Regression was flawed the Court rejected Defendants Dr Leamer only the two years following rather than why the 40 41 at because 40 to the conduct period and therefore of data available 11 California over compensation net the Court noted that Defendants failed to explain Third 10 from the two years preceding and the two years following variable to time Mot for changes control to Strike at 13 in the value of equity Defendants argued that when Dr Court of District an equity variable specifically a variable that tracks introduced much Regression yielded smaller under compensation changes in the S P 500 AllSalaried Employee for the District for the Technical Class See Murphy Rep 138 The Court was not States because the equity variable Defendants selected a variable Northern United the For 21 In addition in the Dr S 500 tracked P Rep Leamer s or that the Regression was flawed 23 employees within the same firm 24 Murphy 25 See 26 observations 27 certain 28 commonly because 89 Thus issues Dr used common to estimate factors accepted a regression clustering is Dr Leamer s that the Mot See method contain a the standard Strike to at 16 Murphy Rep No Conduct to Dr errors take into account the fact that groups particular errors of observations company that are affected or present For the reasons set in a single forth below 11 CV 02509 LHK ORDER GRANTING PLAINTIFFS SUPPLEMENTAL for 126 should have clustered the standard 80 Case results flawed above Defendants argued Dr Leamer such as those affecting referred to as this variable significantly failed to account for the fact that compensation correlated A generally 126 discussed Leamer opined that given this correlation Murphy Rep price of hundreds of unrelated the fact that including Conduct Regression is in the stock analysis did not persuade the Court that to the sensitivity 22 variations MOTION FOR CLASS CERTIFICATION by year the is Case5 11 cv 02509 LHK 1 Court did not find that 2 to reject the Conduct 4 when 5 the 6 See Cook 7 testified 8 Murphy Depo 9 was only one way percent v Rockwell 12 Another approach 83 13 the standard 14 to provide at would be The Court noted 82 83 Thus See id was unpersuasive D Colo 2006 significant to Dr Murphy be reliable the standard errors Rep employees See Leamer Reply to include Dr significant at statistically Dr Leamer adjusting between that a sufficient basis errors the fact that the regression statistically Further as explained by 86 42 2d 1071 1105 of controlling for correlations variable revenue 15 California across F Supp of errors provided should have clustered the standard need not necessarily be results Page81 Conduct Regression s results were not the Corp 580 Int’l firms See id 11 Class Cert Order at level did not persuade the Court that 366 14 20 76 78 82 83 10 clustered confidence at Apr 5 Dr Leamer that that a model s the errors were 95 Leamer s failure to cluster the standard Regression Even assuming 3 Dr Filed10 24 13 Document531 variables Leamer had the Court concluded to explain the commonalities included one such already Dr Leamer s that to cluster failure Court of District errors did not provide a sufficient basis to conclude that the Conduct a reliable methodology Apr 5 for the purposes of class certification Regression failed Class Cert Order District 42 States 16 now Defendants arguments not raised in raise additional their to contend opposition initial Northern United the For Dr Leamer s cannot be used 17 that 18 predominate 19 single conduct variable for all Defendants 20 most analyses recent methodology with respect correlation to damages show show to Specifically that common renewing was inappropriate their 21 that total compensation questions are likely to argument that the use of a Defendants argue that and changes in total Dr Leamer s compensation at 21 22 21 Defendants also contend that because the Court additional 23 24 variables were needed Suppl Opp n this is an issue of even the correlation Opp n 26 28 and Dr greater importance at whether 23 24 to means of Suppl Opp n citing 23 Murphy Suppl Rep add any variables but Rep is not 66 Given of proving and calculating harm more at now that Dr Leamer rejected to Defendants argue that that compensation Defendants maintain that w 68 69 Dr Leamer contends he need s to add at acceptance damages that he Dr Leamer s upon No 11 CV 02509 LHK ORDER GRANTING PLAINTIFFS SUPPLEMENTAL addition this basis 81 Case time Regression as a Dr Leamer s model on for Suppl considered the present of the Conduct the Class was not contingent variables to his analysis the Court does not reject within a ithout accounting impact or aware of any that the Court s whether to address did not add variables to his now Leamer opines Leamer s model cannot reliably determine or measure Leamer Suppl Reply 27 encouraged Leamer 23 Conduct Regression analysis Dr Leamer s model should be firm is highly correlated 25 at MOTION FOR CLASS CERTIFICATION Case5 11 cv 02509 LHK Filed10 24 13 Document531 1 Defendants diverged and sometimes moved in opposite 2 Leamer 3 single conduct variable 4 Certification 5 understandable 6 practices 7 Defendants 8 regarding 9 a more coherent Rep Tables 1 and Order Leamer s because decision Apr 5 data and calculating As at in his 39 40 Dr Leamer s a single conduct variable a 11 model efficient Id The Court a 5 Class compensation approach of aggregating rather than using the limited data each Defendant to calculate separate conduct variables more citing Conduct Regression was Defendants data regarding 24 the use of set forth in the April to use a single variable Class Cert Order at of these divergences light inappropriate compensation the available is limited is 86 of Suppl Opp n directions Defendants assert that in for all Defendants Dr 10 California 2 Page82 is Dr Leamer allowed Dr Leamer s not persuaded that use of determining damages single conduct variable 12 prevents Conduct Regression from to produce the Finally Defendants argue that Dr Leamer s serving Conduct Regression as a reliable is method of overly sensitive to Court of Opp n 24 variable 14 Leamer Suppl 16 of alternative 17 aggregation The 18 variable The Court disagrees in his reply report and rebuttal 15 District 13 choice at supplemental expert Dr Leamer specifically addresses concern 85 97 Rep report See Leamer Reply this District Rep Rebuttal 66 discussing the lack of sensitivity of his findings to inclusion States external control variables such as firm stock prices and to a different level of Northern United the For 19 choice that Because 20 Shaw s 21 Dr Leamer s 22 calculating Court it not persuaded that the Conduct cannot be used Dr Leamer s model e i robust is statistically subsequent analysis classwide 4 23 is damages to is supported by the economic insensitive to alternative the Court finds that 25 individual 26 assessment 27 how this 28 F3d at case should 20 Under it F3d proceed to including literature variables and control Dr Leamer s model is is No Dr by buttressed capable of common issues are likely to predominate at 801 trial the predominance involves a This qualitative assessment includes would actually inquiry a district be litigated court must See In re formulate some New some analysis into Motors 522 predication 11 CV 02509 LHK ORDER GRANTING PLAINTIFFS SUPPLEMENTAL over qualitative 82 Case to Regarding Predominance issues Importantly this Court s analysis of predominance See Butler 727 so sensitive 15 at This Court s rigorous analysis shows that 24 is satisfy Plaintiffs burden at class certification Suppl Reply Conclusion Regression model MOTION FOR CLASS CERTIFICATION as Case5 11 cv 02509 LHK how 1 to 2 predominate specific in 4 exclusively 5 The Court 6 judgment and 7 and 8 contest 9 effect their will play out in order to determine issues case a given As such 3 is common market the 11 standard 12 labor 13 entails 14 Med at issues shown using Class for the reasons discussed be a central clear both disputed through motions their above summary issue at for class certification that Defendants dismiss to will seek to no anti competitive that their agreements had demonstrate that the to under the rule of reason were reasonable and lawful under that had any adverse effect on compensation and could not have conceivably market Opp n or individual violation can be that antitrust Defendants have stated that they intend Specifically agreements should be evaluated quite by contending violation 10 California made to the motion the issue of antitrust dispute 86 of omitted violation is likely to trial Defendants have opposition no marks Page83 common whether the entire Technical to further finds that antitrust initial on internal quotation this Court notes that there is evidence that at Filed10 24 13 Document531 5 n1 The Supreme Court has in any relevant that the rule of reason analysis stated Court of District costs and significant Soc y 457 is US 332 343 often extensive and complex See Arizona v Maricopa Cnty 1982 District 15 Given the considerable compelling common proof have submitted regarding Plaintiffs States 16 Defendants 17 vigorously litigate 18 question likely to 19 be understated See 20 611 21 of the claim 22 is 23 present 24 209 alleged antitrust violation as well as the parties actions that they will indicating Northern United the For is be held 27 Kay Kane 28 is to issue and quoting Thomas FRD 159 26 Plaintiffs Access Memory liability issues certification even such as conspiracy Inc question that is thought to where v Newport Adhesives on Class Actions 1781 predominate Charles No FR D issues 18.25 4th Inc ed 2002 have almost invariably been Alan Wright Arthur Miller 3d ed 2005 603 are Composites whether a conspiracy over other issues in the case Mary existed cf Cordes 11 CV 02509 LHK ORDER GRANTING PLAINTIFFS SUPPLEMENTAL should not of the conspiracy 83 Case this proof on each element significant individual or monopolization issues 7AA and Procedure common trial Litig 264 have held that the existence repeatedly Thomas Rodmakers over individual Federal Practice SRAM Antitrust need not show that there will be warrants violation antitrust At the very least this aspect of the CD Cal 2002 see 6 Newberg 167 predominate a common Random In price fixing cases courts the predominant Defendants engaged in an central to this litigation In re Static ND Cal 2009 Common 25 of whether the question MOTION FOR CLASS CERTIFICATION Case5 11 cv 02509 LHK Filed10 24 13 Document531 1 Co Fin Servs v A G Edwards 2 court concludes that the issue of injuryinfact presents 3 necessarily 4 therefore 5 in favor of a finding Sons Inc 502 follow that they predominate unwarranted that As 6 In addition 7 central element of antitrust 8 that 9 extensive common to concluding questions that violation documentary ones and that class action classwide proof of the district it does not treatment is violation weighs antitrust will predominate questions over individual valued internal equity This suggests 11 on 12 reports 13 evidence 14 that Plaintiffs 15 following a rigorous analysis the Court finds that 16 predominance 17 with respect questions to the analysis also finds a rigorous with respect impact The to a formal wage evidence suggests that Defendants maintained 10 California if questions however Court having conducted will predominate questions Even predominate common the 86 of 2d Cir 2007 individual common the voluminous a result common over F3d 91 108 Page84 had and structure damages members compensation class concludes that Plaintiffs that the anti solicitation agreements a structural impact Furthermore the Court having taken a hard look have presented a methodology that supports at a finding the experts that the Court of District common have the class will be utilized in demonstrating impact to forth a methodology set damages on for calculating Finally the Court finds a classwide Thus basis District Plaintiffs have Rule satisfied 23 b3 s States requirement with respect to all three elements antitrust violation impact and Northern United the For 18 C 19 Rule Rule 23 23 b3 b3 Superiority also tests whether 20 fairly 21 the Court 22 superior 23 individually 24 any litigation 25 desirabilityof concentrating 26 difficulties 27 a class action controversy is Fed superior to other available R Civ P 23b3 methods for must consider method four the non exclusive of adjudicating plaintiffs claims the controversy already the litigation likely to be encountered in 1 the the whether a class action interest of each class or defense of separate controlling the prosecution concerning factors in evaluating commenced actions by or against of the claims in the particular management 2 the of a class action the class forum and of 3 the 4 the Zinser 253 11 CV 02509 LHK ORDER GRANTING PLAINTIFFS SUPPLEMENTAL a and nature extent 84 No is b3 member in 28 Case 23 Under Rule 92 and efficiently adjudicating MOTION FOR CLASS CERTIFICATION F3d at 1190 Case5 11 cv 02509 LHK 1 Plaintiffs 2 claims 3 Mot 4 questions 5 23 6 mandatory trebling 7 Panel 8 9 at an in 23 b3 c lass treatment that state case antitrust common where TFT LCD citing In re 267 FR D are likely to be too small to justify claims the opportunity 10 Plaintiffs 267 predominate FRD Class Cert If common 314 at the superiority prerequisite that Class members individual 314 15 individual noting that in after TFT LCD In re cases individual would of Rule damages even litigation antitrust litigation but a class action Flat damages offer those with small redress for meaningful c lass treatment further contend that 11 than hundreds or thousands of individual 12 proof 13 their 14 same evidence whether 15 California action large to warrant at 86 of definition superior to thousands of individual Antitrust Litig in an antitrust are insufficiently Page85 of liability and impact issues satisfied Plaintiffs contend Antitrust Litig by is Panel Flat are found to predominate is Filed10 24 13 Document531 will also be same more manageable and efficient 23 24 actions the litigating Either defendants colluded or they did not issues with nearly identical either their conspiracy artificially suppressed Court of District compensation structure it or it did not involves Any a single trial here will focus on these questions employee or the Class as a whole and the Class Cert Mot at District States 16 however Defendants t he numerous and argue that substantial issues each separate Northern United the For 17 class member would 18 that class action 19 Zinser 253 20 Certification 21 the groups of people 22 such an approach 23 would be 24 67 68 25 the Court does not F3d have to treatment at 1192 is litigate to superior method of adjudication not the During establish his or her right to recover Defendants proposed instead impacted Aug 8 Tr would not conserve at 31 32 affected bellwether In response because the Given that Plaintiffs case find that conducting Opp n Plaintiffs Supplemental holding multiple resources the opinion that this conduct The Court agrees on the hearing in pay rises at 25 trials to accommodate Plaintiffs and falls of the entire with their trials which company common 28 85 11 CV 02509 LHK ORDER GRANTING PLAINTIFFS SUPPLEMENTAL MOTION FOR CLASS CERTIFICATION Id at evidence will effectively 27 No argued that every single case the proof of impact 26 Case citing Motion for Class counsel for structure numerous bellwether individually means be trials Case5 11 cv 02509 LHK 1 with 2 would merely representing Plaintiffs Thus 3 multiply subclasses the number of a this case 5 conspiracy 6 favor of finding 7 See Zinser 253 8 weigh in favor of finding class treatment 9 Court finds that have V as and the desirabilityof concentrating F3d 1190 92 The at Plaintiffs the litigation superior to is of Defendants satisfied overarching alleged weigh heavily in of the controversy adjudication other methods to weigh in favor of having in one proceeding Court also finds that questions superior In fact this and evidence methods of other 22 management Class members interests addition the nature In that class treatment issues 86 of manageability regarding of adjudication Thus the the superiority requirement CONCLUSION For the reasons set forth above 11 12 13 Rule 14 Technical IT IS 16 Dated October 23 a of requirements for Rule 15 California class action Page86 will ease case same of trials with the 4 10 employees the Court finds that the Technical litigated Filed10 24 13 Document531 the Court finds that Plaintiffs the Federal have Rules of Civil Procedure satisfied all of the as well as the requirements of Court of District 23 b3 Accordingly the Court Class and appoints named GRANTS Plaintiffs Plaintiffs Motion for Class Certification as to the as Class Representatives District SO ORDERED States 24 2013 Northern LUCY United the For H KOH United 17 States Judge District 18 19 20 21 22 22 Defendants further suggest Act because 23 entitled In it would making Court held that Rule 24 relief and not who plaintiffs 25 26 27 28 this 23 argument Defendants b2 damages was which provides not an appropriate sought backpay Supreme Court held would not be that certifying the Technical under Title that the putative able to litigate members Dukes 131 Class would violate Defendants from asserting statutory defenses prevent rely on vehicle class could not that it Dukes of at be 25 citing certified may have the Rules Enabling which they are in which of a class seeking for certifying VII Opp n Title VII defenses a section for the certification to in a the Supreme injunctive class of discrimination Dukes 131 part because had against S Ct at 2561 The the defendant individual class S Ct at 2561 As a result class certification would have expanded plaintiffs substantive rights under Title VII This Dukes holding applied to a class under Rule 23 which provides for only injunctive relief and not for damages thus this holding is inapplicable to the instant case Further Defendants here have not identified any statutory defenses b2 would have against particular class membersnor have Defendants contended would expand Plaintiffs rights under the antitrust laws that Defendants certification 86 Case No 11 CV 02509 LHK ORDER GRANTING PLAINTIFFS SUPPLEMENTAL MOTION FOR CLASS CERTIFICATION that 2 Case5 11 cv 02509 LHK Filed0405 13 Document382 Page1 of 53 1 2 3 4 5 6 7 8 UNITED STATES DISTRICT COURT 9 NORTHERN DISTRICT OF CALIFORNIA 10 11 California SAN JOSE DIVISION RE HIGH TECH EMPLOYEE ANTITRUST LITIGATION IN Case No 11 CV 02509 LHK 12 Court District 13 ORDER GRANTING 14 of DENYING IN PART MOTION FOR CLASS CERTIFICATION IN PART District 15 States 16 THIS 17 ALL ACTIONS Northern United the For DOCUMENT RELATES TO 18 19 Plaintiffs Devine Mark Fichtner Michael 20 Daniel Stover 21 situated 22 Apple Inc 23 Ltd 24 with a principal place of business 25 challenge 26 compensation 27 28 Plaintiffs individually collectively claims against allege antitrust Apple Lucasfilm and their to in the Before the Court Mot ECF No 187 is employee Plaintiffs and on behalf Corp Defendants San Francisco overarching conspiracy restrict Intel Brandon Marshall and Hariharan of Intel all Silicon a class of all those similarly of Intuit whom Inc are No Valley area of California among Defendants to fix and suppress Plaintiffs employee mobility Motion for Class Certification Defendants oppose this motion and move to See Pls Mot IN Class Cert strike the expert 11 CV 02509 LHK ORDER GRANTING IN PART DENYING Intuit Lucasfilm high tech companies 1 Case Adobe Adobe Systems Inc former employers Google Google Inc and Pixar collectively an alleged Siddarth PART MOTION FOR CLASS CERTIFICATION report of Dr Case5 11 cv 02509 LHK E Leamer 1 Edward 2 Class Certification 3 Mot 4 move 5 opposition 6 upon which 7 Oppn 8 supplement 9 Mot 10 of Dr ECF No oppose Plaintiffs Having considered 12 GRANTS 13 amend The part Plaintiffs request 15 Finally the Court 16 Record 17 I the in The Court held Defendants seek to Finally Oppn on a hearing to Defs See class certification Defs of part Plaintiffs Motion for in for Class Cert Joint Class Cert ECF No these motions on January submissions arguments and the relevant the parties in Supp to 38 40 at similarly Plaintiffs employee declarations Supp Mot in Motion for Defendants submitted as well as certain Pls Consolidated Reply Rec 270.1 DENIES in part and M Murphy which of their opposition of their Strike ECF No 210 to Reply ECF No 247 to Strike to Supplement Mot 53 of Oppn ECF No 209 Defs for Class Cert for Class Certification the record in support for Leave Pls Mot Dr Kevin See relies to Page2 submitted in support Plaintiffs E Leamer Edward Motion Murphy Defs Mot to Oppn report of Plaintiffs to 14 California Dr strike the expert to 11 Defs See Rep to Strike Rep which Leamer Filed0405 13 Document382 law Admin 263 17 2013 the Court Class Certification with leave to Court of District Court DENIES Defendants to strike Motion Defendants Strike to GRANTS and in part and report and certain employee expert DENIES in declarations District DENIES Defendants Motion for Leave Joint Administrative to Supplement the States in Support of Defendants Opposition to Class Certification Northern United the For BACKGROUND A 18 Factual Background Plaintiffs 19 20 worked 21 Decl Ann for are software Adobe in B Shaver engineers the State of Washington In Supp Pls Mot 22 Consolidated 23 Arizona from May of 24 Hariharan 25 Shaver 26 Decl Ex 2008 through from October of 2006 through July of for Class Cert Shaver 16 ECF No 65 May of 2011 1 CAC 2006 through December of 18 2006 Mr Marshall See Shaver worked Decl Ex 9 for 2008 See Decl Ex 6 1 ECF No Mr Fichtner Decl Ex 7 See Shaver for Lucasfilm in California from January of 8 Mr Devine were employed formerly by Defendants CAC Amended Complaint worked who worked 1 CAC for Intel in 1 CAC 17 Mr 2007 through August Adobe 188 of 2008 See in California from July of 19 Finally Mr Stover 27 1 28 The Court will address Defendants No 307 in Case No Renewed Administrative Motion to File Under 11 CV 02509 LHK a separate order 2 ORDER GRANTING IN PART DENYING IN PART MOTION FOR CLASS CERTIFICATION Seal ECF Case5 11 cv 02509 LHK 1 worked 2 Decl Ex 10 for Intuit in California from 1 of 2006 through December 5 competition amongst 6 compensation them 53 2009 of See Shaver compete 9 labor This method of recruiting to which Defendants refer as for employees eliminate to of suppressing market each Defendant would CAC soliciting current employees from the other Defendants any manner including 10 directly in 11 another 12 allege that the use of cold calling 13 mobility cold calling includes orally in writing telephonically who companys employee has not otherwise applied the 1 2 55 CAC employees and lawfully competitive functioning by overarching conspiracy for skilled labor with the intent and effect and mobility of Defendants In a properly in an 8 California of Alleged Conspiracy allege that Defendants engaged Plaintiffs 7 November Page3 1 CAC 20 3 4 Filed0405 13 Document382 for among Defendants commonly a communicating or electronically opening job increases total 41 Id with Plaintiffs compensation and Court of 14 District for all of Defendants Here each employees pair of Defendants CAC allegedly 48 50 entered into an express bilateral agreement not to District 15 compete 16 developed to prevent 17 Mot 18 other 19 Defendants Mot 20 Defendants CAC 21 product group or time period 22 Defendants for each others employees CAC 55.2 Plaintiffs maintain that the agreements were States a war for talent bidding that would up wages drive across the Defendants Northern United the For at 2 Defendants memorialized these nearly identical agreements documents 23 most 25 Intuit 26 conspiracy 27 2 important bilateral each firms employees off limitsto other agreements applied 63 76 81 88 100 105 Id They to all employees of a given They were not also were by geography job function limited not related to any pair of specific collaboration among Plaintiffs these anti solicitation to Bill Mot Campbell at 2 Valley Apple all of whom agreements CEO Steve Jobs Google served on Apples Allegedly these three individuals centered Board around three of the CEO Eric of Directors Schmidt and throughout as well as senior executives the from each Do Not Cold Call agreements anti solicitation and anti competitive agreements For the purpose agreements as the anti solicitation agreements 3 parties refer to these agreements as agreements Order The figures in Silicon Chairman The 1 at Do Not Call lists putting CEOto CEO emails and Id According 24 28 including in anti poaching agreements the Court refers to these No 11 CV02509 LHK ORDER GRANTING IN PART DENYING Case IN PART MOTION FOR CLASS CERTIFICATION of this Case5 11 cv 02509 LHK Filed0405 13 Document382 Page4 53 of 1 Defendant 2 policing 3 Defendants 4 employees generally were not informed of nor did they agree to the terms of any of the 5 agreements 6 actively participated violations CAC agreements of the bilateral senior executives negotiating executing in 55 108 concealed each actively also allege that Plaintiffs agreement and Defendants bilateral Id contend that Defendants anti solicitation Plaintiffs agreements eliminated 7 employees and suppressed employees compensation and mobility thereby 8 harm 11 California 12 2 inflicting class wide of Justice DOJ DOJ Investigation From 2009 through 2010 an conducted 111 competition for CAC 110 9 10 with and monitoring compliance After documents of the Department employment and into Defendants investigation receiving the Antitrust Division recruitment by Defendants and produced witnesses interviewing 3 CAC practices the DOJ Court of 13 14 District concluded that Defendants reached facially anticompetitive significant form of competition to the detriment agreements that employees of the affected eliminated who a were likely District 15 deprived of competitively 16 112 see also and important information States ECF No 93 Ex A 2 14 at Dept access to better job opportunities of Justice Compl Against Adobe CAC al et Northern United the For 17 ECF No 93 Ex D 2 15 22 at 18 determined that the agreements 19 than reasonably necessary 20 21 22 23 entered 25 26 27 28 See Lucasfilm its stipulated 3 2011 proposed A at 2011 final 17 CAC Compl naked investigation ECF No 79 1 Ex DDC June Lucasfilm The DOJ collaboration were broader 2 WL DOJ DOJ judgments in filed Adobe 2636850 Lucasfilm at complaints J United DOJ 1 each case Id Defendants did not admit any wrongdoing Compl in States Lucasfilm 3 CAC law 112 court against Lucasfilm J In these stipulated or violation of Inc The DOJ but they agreed to No 11 CV 02509 LHK ORDER GRANTING IN PART DENYING IN PART MOTION FOR CLASS CERTIFICATION Defendants No 10 02220 also filed proposed 4 Case Adobe per se unlawful under the federal v DOJ concluded that Defendants of trade that were restraints 35 DOJ the 112 The DOJ also effort and for the formation or implementation of any collaborative laws DOJ Adobe Compl Following 24 Compl Against were not ancillary to any legitimate into agreements that were antitrust of Justice price setting mechanisms that apply in the labor setting disrupted the normal Compl 16 DOJ Dept final be judgments enjoined from Case5 11 cv 02509 LHK 1 attempting to enter into maintaining or enforcing 2 way 3 employees of the other 4 Against Lucasfilm 5 judgments on March 6 J at 1 CAC refrain 7 from ing soliciting cold 4 CAC at 17 2011 and June 9 case as private attorneys general was unable themselves and for the B 12 The District Court entered 2 2011 respectively DOJ contend that although the Plaintiffs 11 or otherwise competing recruiting for DOJ proposed the stipulated Adobe J Final final J at 12 DOJ Lucasfilm 115.3 the government 10 53 of J at 5 ECF No 79 1 Ex B DOJ Proposed DC 115 The Page5 any agreement with any other person or in any calling person DOJ Adobe 8 California Filed0405 13 Document382 to compensate at of the conspiracy the victims up where to pick Class Mot ultimately put an end to these illegal the DOJ left off to Plaintiffs agreements now bring this seek damages for 1 Background Procedural original complaints in the five actions underlying this consolidated were action filed in Court of 13 14 District court California state May 4 2011 Hariharan v Marshall v Adobe Sys Inc Case Adobe Sys Inc No 11574066 No 11 CV 204052 Case Alameda Super Ct filed Ct Santa Clara Super filed District v 15 June 28 2011 Devine 16 June 28 2011 Fichtner 17 June 30 2011 Stover Adobe Sys Inc Case No 11 CV204053 States v Adobe Sys Inc Case Santa Clara Super No 11 CV204187 Ct filed Ct filed Santa Clara Super Northern United the For 18 19 20 14 2011 4 23 24 25 26 Adobe Sys Inc Case Defendants subsequently District Court for the Northern 2509 19 2011 July 2011 see 3 July see removed 19 2011 see see the five state 1 Marshall v ECF No 41 ECF No 41 ECF No 41 No 11 CV25090 v Fichtner and Stover v v Devine Santa Clara Super court actions District of California Hariharan May 23 2011 ECF No removed removed 21 22 v v Inc Adobe Sys Inc Adobe Sys Inc Case Adobe Sys to the United Adobe Sys Inc Case Adobe Sys Case Case Inc filed July States Case No 11 No 11 3538 No 11 3539 No 11 3540 No 11 3541 Ct removed removed removed July July 19 19 2011 ECF No 41 Under the provisions Judgment has no prima of Section 5 a of facie effect in the Clayton any subsequent Act 15 U SC private lawsuit 16 that a the proposed Final may be brought against Defendants 27 4 While the the Superior 28 name of each Superior Court case listed only Adobe Systems Inc as the Court complaints also named as Defendants Apple Google Intel Intuit Lucasfilm Pixar and Does 1 200 5 Case No Defendant 11 CV 02509 LHK ORDER GRANTING IN PART DENYING IN PART MOTION FOR CLASS CERTIFICATION Case5 11 cv 02509 LHK On 1 June 1 2011 the 2 Magistrate 3 to relate 4 2011 ECF No 52 On 5 underlying actions 6 August lead 2 2011 Plaintiff August July Inc 53 Intuit granted moved from reassigned 19 2011 Hariharan Siddharth of was which Judge Armstrong ECF No 56 San Jose Division Page6 Adobe Systems ECF No 24 On ECF No 41 the five underlying actions to on July 27 transfer which Judge Armstrong a motion filed the five on granted 4 2011 ECF No 58 On 7 August 8 Court consolidated 9 filed 5 2011 the Defendants underlying actions the five underlying actions the Consolidated 10 Amended leave Court Lucasfilm 12 83 On 13 Dismiss and denied Lucasfilms of the April 18 2012 were reassigned on September Complaint filed its separate the Court granted motion the undersigned The judge and Plaintiffs 13 2011 ECF No 65 13 2011 ECF No 79 and with dismiss to to 12 2011 ECF No 64 on September motion to dismiss on October a joint filed 11 California v case Hariharan Judge Spero to Judge Armstrong to the Filed0405 13 Document382 on October in part and denied in part 17 2011 ECF No Defendants Joint Motion to Court of On 14 District October ECF No 119 Motion to Dismiss 1 2012 Plaintiffs Motion filed their their opposition for Class Certification ECF No 187 On District 12 2012 15 November 16 ECF No 209 17 Plaintiffs 18 the 19 a 20 Opposition to Class Certification ECF No 263 21 270 The Plaintiffs 22 Plaintiffs 23 ECF No 339 Defendants filed to Plaintiffs Motion for Class Certification States as well as a Motion to report submitted Strike the expert by Plaintiffs ECF No 210 Northern United the For then Motion to their Motion for Leave to Supplement 17 2013 case law relevant filed two Named or of and Defendants in Support of Defendants Motion for Class Certification on January to Plaintiffs their similar notices see filed Motion for Class Certification see ECFNos 343 368 Class Definition Plaintiffs seek to certify AllEmployee Class a nationwide defined class of similarly situated individuals the as follows All natural persons employed on a salaried basis in the United States by one or more a Apple of the following 28 from May 2005 through from March 2005 through December 2009 December 2009 c Google from March 2005 through 6 Case No 11 CV 02509 LHK ORDER GRANTING IN PART DENYING IN b Adobe PART MOTION FOR CLASS CERTIFICATION to filed ECF No new a notice 9 2013 Defendants an opposition then filed January the Record which to on 25 27 10 2012 ECF No 247 On Court held a hearing C Class Consolidated Reply in Support of Class Certification and in Opposition on December Strike Joint Administrative 24 26 filed Case5 11 cv 02509 LHK d December 2009 1 December 2009 3 4 5 6 7 designed their their 1 at members Mot 5 at contend that the Plaintiffs According agreements to Alternatively is e Intuit from 2009 Excluded of the boards of more than 100,000 broad because Defendants ANY employee of employees to accomplish and Defendants enforced their goals Mot 24 at the Court to certify the following class of salaried technical and development employees and research creative members AllEmployee Class includes competition for move Plaintiffs officers to Plaintiffs the Class Definition restrict 53 of all Defendants agreements across a wide variety 8 9 Mot corporate of from January 2005 through from January 2005 through December employees retail and senior executives directors Notice of g Pixar or from the Class are f Lucasfilm 2009 Page7 December 2009 from March 2005 through Intel June 2007 through December 2 Filed0405 13 Document382 the Technical Class5 as follows defined 10 who work All natural persons 11 development or California 12 14 the 15 corporate States December 2009 from March Intel 2009 Class officers members research and by one States b 2005 through December 2009 c Google from March 2005 e 2005 through December 2009 December 2009 g Pixar from or and or a salaried basis in the United from March d Employee Technical creative through 2009 through December District a Apple from June 2007 through Intuit District May 2005 through December 13 employed on fields that are of the following Adobe from Court of more in the technical f Lucasfilm from January 2005 January 2005 through December 2009 Excluded from the Class are of the boards of directors retail employees and senior executives of all Defendants 16 Northern Notice of United the Mot 50,000 people For 1 at believe Plaintiffs that their alternative Technical more than Class includes 17 Mot at 5 18 also Plaintiffs move the Court to appoint them as Class representatives and to confirm as 19 final prior interim appointment the Courts of Lieff Cabraser Heimann Bernstein LLP and the 20 Joseph Saveri Law Firm as CoLead Counsel See ECF No 147 Finally Plaintiffs move the 21 22 5 This proposed alternative class consists of those members of the Class with the following job 1 Software Engineers 2 Hardware Engineers and Component Designers 3 Application 4 Programmers 5 Product Developers 6 User Interface or User Experience Designers 7 Quality Analysts 8 Research and Development 9 Animators Digital Artists titles 23 24 Developers Creative 25 Directors Developers 12 and Technical Editors IT Professionals Employees classified as technical B ECF No 13 10 Systems Engineers and Administrators and professionals 11 Web 14 Dr Edward Graphic Designers and Graphic Artists by Rep their employers See Report of 26 Leamer Appx 27 1 Non technical Employees marketing accounting finance operations etc 2 Senior Executives 3 Non US employees 4 Network Administrators 5 Systems SupportMaintenance Personnel 6 Maintenance Employees or 7 the following types of 190 Leamer The Technical Employee Class does employees Facilities 28 Manufacturing Technicians Id 7 Case No 11 CV 02509 LHK ORDER GRANTING IN PART DENYING IN PART MOTION FOR CLASS CERTIFICATION not include Case5 11 cv 02509 LHK 1 Court 2 Berger 3 II as Class Counsel the law firms that have appoint to PA and Montague Grant Eisenhofer PA Class actions does not 6 of 7 requirement of Rule 8 273 showing 9 mere forth a set of 53 served on the Executive Mot at Committee 2 23 b Zinser Cir 2001 9th class certification v A party Inst Inc 253 Research Accufix seeking class Stores Inc F3d bear the burden one at least 1180 1186 amended must affirmatively certification v Dukes plaintiffs 23 a and of the four requirements of Rule Rule Wal Mart with the compliance met each obtain Rule 23 Rules of Civil Procedure of the Federal To standard pleading that they have F3d 1266 by Rule 23 are governed 5 US 564 131 demonstrate S Ct 2541 2551 2011 11 23 a provides Rule a that district may certify 2 there numerous that 13 common claims or defenses of the class and 15 the interests class 16 requirements of numerosity commonality typicality and adequacy 17 maintain a class action 18 see 19 ascertainable 20 LCS Fin Servs Corp 274 of all to the class 3 the is impracticable 1 the a class only if 12 joinder members court 14 California Page8 LEGAL STANDARDS 4 10 Filed0405 13 Document382 class is so of law are questions and fact Court of District claims or defenses 4 the parties are typical of the of the representative representative parties will fairly and adequately protect District of the Fed R Civ P 23a That is the class must at a minimum satisfy the States of representation in order to Northern United the For Fed 21 R Civ P 23a Further while Rule FR D 666 four prerequisites evidentiary 23 569 24 actions 25 substantial prejudice 26 under Rule 23 27 apply generally to the class so that 28 appropriate 2013 at least WL respecting this certified under Rule actions the party opposing the class as a final 666 F3d 581 588 as to whether the class must requirement as well See satisfied the court Rule 23 of Rule 23 b No 23 b a showing R Civ P 23b1 the class has acted injunctive whole Fed relief Comcast Corp IN Herrera v Behrend that there is a risk of A class may be or refused to act or corresponding R Civ P 23b2 v types of class certified on grounds declaratory Finally a class 11 CV 02509 LHK ORDER GRANTING IN PART DENYING eg be satisfy through sets forth three general b1 upon Fed must 8 Case 9th Cir 2012 ND Cal 2011 23 a are 2013 4 from separate if 672 Co Inc 23 a is silent of the three subsections 1222646 A class may be b2 one of Rule 22 US proof Motor have held that the rule implies courts If all v Am Honda Mazza PART MOTION FOR CLASS CERTIFICATION that relief is may be Case5 11 cv 02509 LHK 23 b3 1 certified 2 members predominate over any 3 action 4 controversy under Rule the court finds that if questions Fed questions and fairly Page9 law of or fact of 53 common membersand only individual affecting methods for superior to other available is Filed0405 13 Document382 adjudicating efficiently to class that a class the R Civ P 23 b3 5 A 6 with the merits of the plaintiffs 7 and Trust Funds 568 US 8 also 9 analysis to determine whether the party seeking certification has met the prerequisites courts class certification F3d Mazza 666 at analysis underlying 133 588 claim Amgen S Ct 1184 1194 11 Comcast 12 license to engage 13 at 14 are relevant to determining whether the Rule 15 California 23 Id Corp 569 2013 Before certifying a class the 10 quoting Zinser 253 must be rigorous and may F3d US at 1186 2013 in free ranging WL v Inc Connecticut quoting trial 4 some merits inquiries at the certification Plans S Ct at 2551 court must conduct a Nevertheless overlap Retirement Dukes 131 This analysis applies to Rule 1222646 entail 23 a and see rigorous of Rule 23 b Rule Rule 23 grants courts no stage Amgen Inc 133 S Ct Court of District 1194 95 Merits questions may be considered to the 23 extent prerequisites but only to the extent that they for class certification are satisfied District at 1195 States 16 If a court concludes that the moving party has met its burden of proof then the court has Northern United the For 17 broad discretion 18 III at 1186 DISCUSSION 19 The Supreme Court has long recognized 20 enforcement 21 Standard Oil 22 antitrust 23 compensation 24 F3d Zinser 253 to certify the class of antitrust laws See Reiter Co 405 US 251 v Plaintiffs Corp Sonotone 1972 Here Plaintiffs 262 laws by entering into an overarching to artificially that class actions low levels See illegal Mot at serve 442 a valuable US 330 344 role in the 1979 allege that Defendants conspiracy in order to suppress violated numerosity commonality typicality and adequacy 26 P 23 a 27 Jan 17 Case No Defendants do not contest 1 2013 Class Cert Hrg Tr at of representation have that Plaintiffs satisfied Mot at 46 see these requirements 510 15 28 9 11 CV 02509 LHK ORDER GRANTING IN PART DENYING IN the employee assert that both of their proposed classes satisfy the elements of Rule 25 Hawaii v PART MOTION FOR CLASS CERTIFICATION 23a Fed See R Civ Tr of Case5 11 cv 02509 LHK 1 also contend that their proposed classes Plaintiffs 2 Defendants disagree Specifically 3 Rule 4 proved on a class wide basis 5 superiority requirement is not satisfied 6 Page10 of 53 23 the requirements of Rule satisfy b3 disputes 23 7 8 b3 predominance s Defendants argue that Plaintiffs proposed classes do not satisfy requirement because neither Oppn 11 at antitrust In addition Defendants Oppn 25 at requirements of Rule A 10 23 b3 shall have Plaintiffs impact nor damages can be leave exclusively have Plaintiffs amend to 23 contend that Rule This Order focuses For the reasons stated herein the Court does not find that 9 on b3 s these the fulfilled IV See Part Predominance The predominance 11 California Filed04 05 13 Document382 commonality 12 591 624 1997 13 Comcast 23 of Rule criterion b3 23 a requirement set forth by Rule See Courts have a duty to look closely far is at more demanding than v Amchem Prods Inc satisfying the Windsor 521 whether this requirement is US See satisfied Court of 14 District Corp US 569 The predominance 2013 WL 4 1222646 on analysis focuses that qualify each class the legal or factual questions District 15 members case 16 sufficiently 17 623 As 18 Trust 19 not that those questions 20 emphasis in original 21 Although as a genuine controversy in order to determine whether proposed classes are States cohesive to Amchen Prods Inc 521 by representation warrant adjudication Northern United the For Justice Ginsburg Funds Rule 23 recently emphasized b3 requires a will be there is in showing answered on no mathematical Amgen Inc v that questions the merits in favor of the or mechanical F3d 802 test 22 Messner v Northshore 23 generally 24 basis are such a significant aspect of the case that they present 25 the dispute 26 F3d 1011 1022 27 make 28 present Univ HealthSystem 669 met where common questions which can be on a representative 9th a prima facie rather than Cir 1998 on an amended individual the member to member then class 133 a predominance members on clear justification Hanlon v No IN b3 a class is wide for handling marks and citation omitted If to of a proposed class will need to it is an individual question 11 CV 02509 LHK ORDER GRANTING IN PART DENYING 23 Chrysler Corp 150 10 Case S Ct at 1191 Cir 2012 Rule for all basis members the class predominate for evaluating 7th resolved internal quotation showing on a given question evidence that varies from 814 to at Retirement Plans and Connecticut common US PART MOTION FOR CLASS CERTIFICATION If the same Case5 11 cv 02509 LHK Filed04 05 13 Document382 Page11 1 evidence will suffice for each member to make a prima facie showing then 2 question Messner 669 3 53 becomes a common Cir 2005 4 begins 6 Halliburton 7 F3d at 815 of law or fact common Co 131 S Ct 2179 2184 TFT LCD 8 re 9 other grounds 10 In this Panel Flat in to class case Fee US C 12 Mot 13 antitrust 14 of 15 Motors 522 F3d 6 19 n18 To 1 4 Section 267 FRD 291 1 Act 15 of the Clayton Antitrust claim establish an antitrust of the P John In on abrogated 15 See Antitrust Act 15 119135 Compl 1 a violation typically must prove plaintiffs proof 9th Cir 2012 Sherman U SC v Fund Inc individualized to n7 755 8th members predominate ND Cal 2010 311 13 566 these elements in order to analyze F3d 741 686 Antitrust Litig allege a violation of Section Plaintiffs 11 1 and must Erica proof and which are subject Antitrust Litig ATM In re common to A court 2011 it Co 400 F3d 562 Monsanto with the elements of the underlying causes of action determine which are subject at v quoting Blades Considering whether questions 5 California of of Court of District 2 an injury they suffered laws damages In re New Motor as a result Canadian Export Vehicles and of that violation 3 an estimated Antitrust Litigation In re measure New District 1st Cir 2008 The Court each in turn will address States 1 16 Antitrust Violation Northern United the For 17 Regarding the 18 the Court 19 antitrust 20 this violation Plaintiffs predominate issues prong of the analysis assert that Defendants unlawful under Section 23 1 of the Every contract combination commerce among the 24 or 25 Rebel Oil 26 Section 27 28 common 1 element of Plaintiffs Section See Tr at antitrust 17 1 4 Mr Mittelstaedt claim the parties agree as does Court Do you contest Not for Defendants 4 Co Inc v Atlantic Sherman in several conspiracy Antitrust for purposes of 2 Mot CAC Act States or with foreign nations is Co 51 F3d 1421 1431 Richfield parties to sue antitrust 1 claim of Plaintiffs Section anti solicitation agreements and agreements restrained trade and are per se at 1 see the form of trust or otherwise or conspiracy of the Clayton Act allows private In support Plaintiffs which were memorialized in declared 9th to be Cir 1995 violators for No IN US C 1 of trade illegal see explaining also that damages have set forth evidence of Defendants CEOto CEO emails and 11 CV 02509 LHK ORDER GRANTING IN PART DENYING 15 in restraint 11 Case the motion 21 22 that first PART MOTION FOR CLASS CERTIFICATION other Case5 11 cv 02509 LHK Do 1 documents such 2 Defendants 3 explicit anti solicitation agreements with as Do 5 Rep 6 agreement with 7 See 8 Decl 9 employees See Leamer 21 22 eg Apple Google workers 11 employee 12 function not to 9 n26 Rep at Pixar make counteroffers its agreements with See Leamer not to compete and to notify each other before to all Intel pursue each proactively These agreements applied Hands Off and Intuit Harvey Consolidated Reply and Lucasfilm agreed into to its anti solicitation In addition Supp Pls in on entered Intel Intuit and Lucasfilm including and Pixar agreed not to Intel Decl Ex 60 Shaver Pixar and Google and included M Harvey Decl Dean 53 of CEO of Apple Apple into anti solicitation also entered Decl Ex 56 ECF No 93 Ex 25 Adobe this case in Page12 each firms employees offlimits to other Decl Exs 17 19 55 66 see also Shaver Shaver others putting lists Call List every Defendant 10 California Not Call These documents show that while Steve Jobs was 4 Not Filed04 05 13 Document382 for each extending employees others an offer to an regardless of job product group or geography Court of Plaintiffs 14 Defendants employees 15 District 13 the agreements allege that Defendants concealed each senior executives bilateral agreement and were not informed of nor did they agree to the terms of any of generally District For example when discussing Googles protocol for Do Not Cold Call and States 16 Sensitive companies Google CEO Eric Schmidt stated I want to create a paper dont trail over Northern United the For 17 which we can be sued later Not 18 likewise stated 19 broadly known 20 with employees from 21 want anything 22 we 23 Decl Shaver in Adobe Ann writing at alleged 26 United 27 DOJ misconduct States v to Similarly when Decl Ex 21 CEO Paul and myself Apples discussing I Inc et stipulated but see Shaver anti solicitation Decl Ex No Any 66 in a al No 10 1629 these agreements to 1 Sherman Act 15 Final DDC Sept 24 2010 be a U SC naked restraint on 1 11 CV 02509 LHK ORDER GRANTING IN PART DENYING IN early into Judgment See Shaver 12 Case would not following an investigation finding of the Otellini like this policy Everson of Apple reiterated that they did not mirrorthe DOJs findings Adobe Systems per se unlawful per Section eric Intel Pixar should be told of our gentlemans agreement which Defendants Impact Statement between recruit Reeves and Brenda Harvey Plaintiffs allegations 25 no Decl Ex 52 bring in for interviews 24 28 e have a handshake this Shaver Ex 41 process W sure about PART MOTION FOR CLASS CERTIFICATION candidate on in the Defendants Decl Ex 71 ECF No trade that 2 w ere Case5 11 cv 02509 LHK 1 Defendants contend that 2 the agreements should 3 standard 4 labor 5 question be 6 of antitrust liability is The Court need Health 8 conspiracy 9 whether a common ND 581 we can prove a conspiracy 10 For purposes of evaluating 11 California in original Defendants alleged 12 issues Defendants concede 13 23 antitrust W 2009 on consider with predominance time See hether plaintiffs See Tr eg Reed v relevant it is 18 2 8 at Advocate rather the question yes is common have satisfied legal and is emphasis sufficient that the adjudication Plaintiffs that the can prove that a proof and the answer on overwhelmingly Court finds that this any one individual class certification common violation will turn and an issue rather than Ill in under that during oral argument Defendants conceded the issue of liability at this existed is not an issue that plaintiffs demonstrate that had any adverse effect on compensation Nevertheless not resolve FRD 573 Care 268 7 53 of under the rule of reason were reasonable and lawful evaluated 5 n1 at Page13 proceeds Defendants will seek to this action if and could not have conceivably market Oppn Filed04 05 13 Document382 of factual this element of Rule Court of b3 Tr See 17 1 4 2 14 District at Antitrust Impact District 15 The second element of Plaintiffs Section 1 claim antitrust is impact Antitrust impact States 16 17 antitrust 18 2006 19 violation and the injury is also referred to as antitrust the fact of damage that results from a violation of the Northern United the For 20 laws WL In re 1530166 The 7 ND Cal June damages sought by question presented by 5 2006 plaintiffs It is In re had an impact on any employees Defendants concede 22 impacted 23 impacted 24 that 25 alternatively 26 would have 27 member In Tr at 144 11 12 The primary Defendants Technical to And I New is whether that re Methionine link between Motors 522 F3d the antitrust at we n18 nobody was common can show through proof suppressed wages across the entire All Employee Class or by mini trials examining Antitrust Litig 204 is actually an individual the particular circumstances FR D 161 165 11 CV 02509 LHK ORDER GRANTING IN PART DENYING IN PART MOTION FOR CLASS CERTIFICATION question that of each class ND Cal 2001 13 No 19 are not saying that 28 Case No 02 1486 some employees may have been Plaintiffs Class or whether proof of injury be resolved Antitrust Litig Defendants anti solicitation agreements admit at the start issue presented conspiracy alleged the causal this case is not whether 21 See DRAM Dynamic Random Access Memory Case5 11 cv 02509 LHK 1 In analyzing whether Plaintiffs 2 will be able to demonstrate 3 establish antitrust 4 persuasive 5 requirement 6 satisfied have satisfied impact in of the nature light The Court then 23 b3 7 analyzes Whether 23 8 b3 common Plaintiffs and conspiracy alleged impact must be of class if proof must so how satisfy this to Plaintiffs have wide impact Must Show Common Impact to Satisfy Rule Predominance Requirement contend that should the Court determine that first common evidence to determine whether the parties Plaintiffs s whether considers first for proving 53 of burden of showing that Defendants of Page14 predominance requirement for the question s a Plaintiffs their class wide injury the Court Plaintiffs proposed methodology Rule Filed04 05 13 Document382 common of Defendants proof 9 conspiracy will be the predominant antitrust issue at trial the Court may on grant class certification 10 that basis alone See Mot at 11 legal issues California of whether 7 Specifically the Defendants Plaintiffs contend that because into the agreements entered their and the major factual scope duration and their 12 Court their of on compensation effect other price fixing Mot cartel 6 see at 14 District common are overwhelmingly th is case is no different than any 13 also Reply at 6 Prices do not need to be identical in District by order to be impacted common a conspiracy courts where routinely certify class actions as here 15 States any individual negotiations of which there is little evidence were commonly impacted by 16 Northern Defendants misconduct United the As For The Court declines to make such a determination at this juncture 17 the Third Circuit stated in In re Hydrogen Peroxide in Antitrust Litig cases antitrust 18 impact often important for the purpose of evaluating is critically Rule 19 requirement because is it an element of the claim that may call 23 b3 s predominance for individual as opposed to five circuit and 20 common proof 552 21 least two district courts F3d 305 311 3d Cir 2008 Notably within this district at least have held that for cases involving courts at violations antitrust 22 common issues do not predominate unless the issue of impact is also susceptible to class wide 23 proof See In re New Motors 522 24 Litig 552 25 26 2003 F3d 311312 Messner 669 California 27 Cal Sept 28 v Infineon 5 2008 F3d F3d 3d Cir 2008 at 816 7th Technologies In re Graphics at 20 1st Bell Atl Cir 2008 Corp v Infineon Hydrogen Peroxide Co 400 F3d at 566 No 06 4333 2008 Processing Units Antitrust Litig 253 WL No FRD 11 CV 02509 LHK ORDER GRANTING IN PART DENYING IN 8th PART MOTION FOR CLASS CERTIFICATION at 5th Cir Cir 2005 4155665 14 Case Antitrust ATT Corp 339 F3d 294 302 Cir 2012 Monsanto AG In re 500 at 5 ND Case5 11 cv 02509 LHK 1 Moreover WL as the Ninth Circuit noted recently 2 2013 781715 3 balance between 4 omitted Therefore 5 policy 5 6 Vinole 9th Cir 2013 a district to common ones that predominate 9 on an F3d 935 946 9th may inquiry is the marks and citation internal quotation in relying F3d News internal uniform inquiry Id quoting Cir 2009 for individualized call inquiries proving impact on a class wide basis over b 10 11 Burden The Court next of Proof in how addresses must demonstrate a method for the Court finds that Plaintiffs Demonstrating Antitrust Impact 12 demonstrating impact on a class wide basis 13 be the class suffered 15 LCD 16 must be Plaintiffs proposed methodology persuasive 14 California 13 at of impact in this case 8 53 of Chinese Daily to the predominance of other factors relevant concerns that questions Page15 concern of the predominance court abuses its discretion Home Loans Inc 571 Countrywide Due 7 t he main v Wang in and common issues Id individual to the near exclusion v Filed04 05 13 Document382 for p laintiff s must common impact omitted In order to prove Court of District able to establish predominantly with generalized damage evidence as a result of Defendants that all or nearly all anti competitive alleged members conduct In re of TFL District Flat Panel Antitrust FRD Litig 267 311 at internal quotation marks and citation States Northern United the For 17 Plaintiffs assert that 18 Plaintiffs 19 proven on a class wide 20 267 FRD 21 See eg 22 Cal Sept 23 whether 24 be proven on 25 need only advance at 311 13 California 5 2008 plaintiffs v t he a methodology plausible basis Mot Indeed Infineon inquiry in this regard is focused and circumscribed courts at 15 quoting multiple courts Technologies certification 27 evidence of have advanced a class wide a plausible basis DRAM 28 stated that should be limited to whether a antitrust court In re within TFT LCD this district Flat impact See may AG No 06 4333 2008 WL methodology 2006 courts plaintiffs 2006 the merits or to WL 1530166 some eg DRAM not consider Panel must antitrust 1530166 weigh competing to present No at 9 IN only injury can expert inquiry These courts testimony 11 CV 02509 LHK ORDER GRANTING IN PART DENYING ND on class generalized 15 Case 9 same 9 intend at discern have stated that a courts merely WL Antitrust Litig 4155665 demonstrate that at injury can be have endorsed such a standard stating that at the class certification stage the Court In applying the plausibility standard 26 to demonstrate that antitrust PART MOTION FOR CLASS CERTIFICATION have further See eg id Case5 11 cv 02509 LHK t he 1 Court 2 accepted 3 realistic testimony regarding and have Defendants 5 of plaintiffs therefore were as explained standard by Judge Alsup 9 graphs and tables should not certification could survive not appropriate Id at 491 be that conducting believes 12 methodology 13 ensure that the predominance 14 1222646 15 court must conduct a 16 California experts over whether Rule 17 Ellis 18 merely determine whether such evidence 19 evidence presented 20 factual 21 983 22 determine whether there was a is consistent seemingly holding went that to the merits Processing Units Antitrust even under a plausible to hold otherwise certification without fully complying The Court was for class certification in In re Graphics were have courts methodology automatic every time counsel dazzle the courtroom the Court If some Id at 8 9 impact concerning 53 presented methodology GPU 253 FRD 478 ND Cal 2008 8 In re criticisms of that expert evidence case and Litigation 11 consider to plaintiffs 7 10 to of Indeed impact so long as the methodology challenge However 6 declined Page16 testimony must avoid engaging in a battle of expert expert 4 Filed04 05 13 Document382 with Rule a thorough review 23 nearly all Id at antitrust with plaintiffs 492.6 of Plaintiffs theory and with the requirement that the Court conduct a rigorous analysis to Court of District 4 stating that the requirement same is analytical met principles which apply District rigorous Corp 569 See Comcast analysis govern Rule 23 b US to Rule When WL 2013 23 a including parties stage a battle that a of the States 23 s requirements have been satisfied the Ninth Circuits decision in Northern United the For 23 v Corp Costco Wholesale Id at 982 657 F3d 970 is 9th Cir 2011 indicates that a court must not admissible but also In addition Ellis counsels necessary to determine whether disputes stating that the district court was required common Rule to judg e the that the Court must 23 s requirements have resolve any factual disputes pattern and practice that could of the persuasiveness any resolve been satisfied necessary a whole emphasis in original 24 6 25 26 Justice Scalia 28 expressed similar sentiments v Scalia expressed concern that Rule Berhrend to a nullity 27 recently Corp if another courts antitrust declined suit 23 when writing for the majority brought pursuant to Rule b3 s predominance to assess whether a plaintiffs 23 b3 in Specifically requirement would be proposed methodology Comcast Justice reduce d for measuring U and quantifying damages on a class wide basis was speculative Comcast Corp 569 S 2013 1222646 5 Under that logic at the class certification stage any method of measurement would be acceptable so long as it could be applied classwide no matter how WL arbitrary the measurements may be emphasis in original 16 Case No 11 CV 02509 LHK ORDER GRANTING IN PART DENYING IN at to affect the class as Id PART MOTION FOR CLASS CERTIFICATION Case5 11 cv 02509 LHK 1 With these principles in Filed04 05 13 Document382 mind the shown 3 set forth 4 regard to the All Employee Class or the Technical below requirement met the Court concludes that Plaintiffs 5 c Methodology 6 The Court next 7 to Prove for proving class wide have not at this impact For time have Plaintiffs satisfied the reasons their burden with Class Class wide Impact addressing class wide impact 8 9 In support wide impact 10 11 California is 53 of Court proceeds to determine whether 2 that the predominance Page17 Leamer is the methodology that common submit an expert Plaintiffs asked Plaintiffs issues report of Dr Leamer of each class generally 2 and and evidence upon which the parties rely predominate for the purpose of assessing E Leamer PhD Edward to evaluate artificially 7 whether evidence agreements capable of showing that the anti solicitation 1 members 12 showing of Rep considers all members or most class ECF No See common to in 190 each class reduced the compensation of Leamer of each class Rep Court of 10 a 13 In addition Plaintiffs asked Dr 14 formulaic method capable of quantifying 15 District Class Leamer the to assess whether there is amount a reliable class wide or of suppressed compensation by each suffered District Leamer 10 b Rep States Dr Leamer 16 Northern United the For studied Defendants compensation data reviewed Defendants 17 documents about the agreements and 18 Ultimately Dr Leamer a the 19 20 effects their concluded that common and applied Dr Leamers 21 the compensation analysis proceeds in 22 studies and theory documentary 23 anti solicitation agreements tend ed to b as a result of Defendants of all or nearly all Class members two steps evidence and the facts to evidence and methods are capable of showing that agreements had an adverse effect on compensation and solicitation agreements labor economics internal First analyses statistical suppress Dr Leamer anti was suppressed opines that economic are capable showing of employee compensation generally by that the preventing 24 7 25 Dr Leamer is the Chauncey Professor 26 of Statistics degree Mathematics PhD 27 28 in at J Medberry the University from Princeton Professor University degree in Economics at the University the fields of econometric macro economic methodology forecasting of of California at in 1966 of Michigan and statistical on the subject including Management Los Angeles Professor of Dr Leamer and a Masters in Mathematics in 1970 He analysis in international of inferences that may appropriately 11 CV 02509 LHK ORDER GRANTING IN PART DENYING IN and a economics and 17 No BA has published extensively drawn from non experimental data Case Economics and earned a PART MOTION FOR CLASS CERTIFICATION be in in Case5 11 cv 02509 LHK Filed04 05 13 Document382 Page18 work Mot 16 of 1 Class members from discovering the true value of 2 Leamer opines 3 were paying some members of the Class less than they would have been paid 4 Dr anti solicitation agreements 5 According Dr Leamer to economics such 7 markets function 8 forces 9 approximately the same this first Dr Leamer by enough and work pricethe rapidly 11 informationflow can slow the process when Market price discovery is by which transaction by which the process in presume s of the labor that market occur at demand Leamer costs and limited prices reach market in how evaluating supply and transaction Defendants of information principles model which participants words the absence that virtually all transactions change high market conditions In other the very least at market price which equilibrates Rep In reality enough at notes that when economists often use a market equilibrium 10 12 showing that step is supported market price discovery as are powerful 71 their that class wide evidence is capable of 6 California 53 a market equilibrium search for the right Court of 13 price Leamer Dr Leamer 14 District 71 73 Rep 36 40 Leamer Reply hypothesizes that by cold restricting calling and other competition over District 15 employees Defendants anti solicitation 16 compensation 17 and 18 movement between 19 information that could have been used 20 Leamer 21 to 22 financial agreements impaired information flow about States and job offers Mot at 3 As a of inhibiting result employees ability to discover Northern United the For 23 obtain the competitive value of their services Rep firms and 71 76 thus fewer In addition to rewards in order opportunities taking to increase their fewer opportunities salariesand deprived opines that by limiting the information affirmative steps such as offering to retain employees for higher wages and benefits within a firm See negotiate Dr Leamer employees Defendants could avoid employees were afforded with valuable firm specific available their employees skills Leamer Rep 77 80 24 Second Dr Leamer opines economic that 25 statistical 26 virtually all Class members In order to explain 27 Defendants anti solicitation analyses are capable of showing studies and theory documentary that this suppression of compensation how the adverse effects agreements would have been felt not only 11 CV 02509 LHK ORDER GRANTING IN PART DENYING IN all or to by employees who would 18 No affected and on compensation due 28 Case evidence PART MOTION FOR CLASS CERTIFICATION of Case5 11 cv 02509 LHK 1 have been recruited 2 loyalty by all employees corporation wide but and fairness internal 3 Dr Leamer 4 can translate into a sharing 5 otherwise 6 increases 7 implies or reductions that when 8 higher wages for a 9 for the improved o ne across outside few Rep 104 Equitable broad categories 53 on relies theories of opportunities opportunities put pressure compensation at that 12 would have been widespread and extended 13 Class and Technical 14 maintain worker loyalty by adhering to principles 15 A key eg structure calling for rewarding component Rep of everyone Dr Leamers structure that the overall common firm structure is evidence can demonstrate that the to artificial all Leamer wage Dr Leamer this to firm wage structure rigid See 11 a market might wage the in of fairness that practices spread According one point some workers Id theory is wage of loyalty is a feeling workers Id of 10 California of more equality than firms tend to maintain the overall outside Leamer foundation of employee a firms rewards with of Leamer Dr Page19 equity contends that produce Filed04 05 13 Document382 101 explaining suppression of employee compensation or nearly all members of the AllEmployee Court of District Class based in part on economic theory implicating of internal equity firm incentives to through a rigid salary District States Dr Leamer 16 further explains to that maintain loyalty it is usually better for a firm to Northern United the For 17 anticipate 18 firm at a much higher level of compensation coworkers 19 fairly 20 reducing productivity 21 avoid 22 improvements 23 rather than to react to outside compensated this reduction economics 25 and and Rep 105 This since if left a worker were Dr packages Leamer opines that by considerations put competitive pressure move can have an adverse effect on worker in loyalty in the face of competition compensation to to another behind might feel they have not been and increasing interest in employment elsewhere in their Essentially 24 Leamer opportunities firms may loyalty Id Therefore to make preemptive Id virtue of the interplay between of internal equity cold calls would have information transmitted information to on 26 See Reply at 27 16 28 the anti solicitation see also Leamer Rep 104 agreements Dr Leamer further hypothesizes that firms are able to be more relaxed by virtue of entering into in maintaining competitive 19 Case No 11 CV 02509 LHK ORDER GRANTING IN PART DENYING IN PART MOTION FOR CLASS CERTIFICATION Case5 11 cv 02509 LHK 1 compensation 2 the risk of employees 3 competition for passive 4 packages Defendants Filed04 05 13 Document382 1 because such agreements becoming aware of own their expert Kevin 6 for the purpose of determining class wide 7 contend that 8 inadmissible 9 702 Leamers testimony on the 11 DENIES Defendants 12 While impact See Dow Merrell latter Motion ECF No Id ground to 8 Strike at 230 common over Rep 11 25 at Defendants have For the reasons stated in Part ones Defendants but also US 579 Inc 509 1 Dr Leamers attack Murphy see Oppn Pharmaceuticals Mot Rules of Evidence see of the Federal 10 California v under Daubert reduce otherwise eliminate inquiries predominate not only unpersuasive is 3 M Murphy PhD analysis and conclusions and argue that individualized evidence 2 106 5 Dr Leamers 53 of competition directly suppress pay practices elsewhere and employees Leamer Rep through Page20 1993 moved and Rule strike to VIB infra the Dr Court to Strike Dr Murphy criticizes the economic literature Dr Leamer upon which relies he does Court of not dispute 14 See 15 19610 197 7 19 16 District 13 not discuss the strength of the incentive 17 goals such as procedural equity or the value of rewards for individual 18 motivator 19 may eg the basic principles Harvey economics of information Decl ECF No 93 Ex 13 Murphy undergirding Dep Dr Leamers hypothesis 188 6 14 192 25 193 6 194 10 at District Dr Murphy criticizes Dr Leamers Similarly although report because it does States maintain internal equity as against to other compensation Northern United the For see Murphy Rep 81 this does not negate have played some role in affecting 20 Therefore the Court finds that Dr Leamers common hypotheses offer theories subject 22 agreements suppressed compensation broadly 23 theory 23 is not sufficient to satisfy Rule a as loyalty hypothesis that internal equity employment compensation 21 to Dr Leamers contributions market proof for how However b3 s and internal equity price discovery Defendants as observed requirements In re anti solicitation by the In re GPU 253 GPU FR D Court at 496 24 8 25 Dr Murphy is the George J Stigler Distinguished Service School of Business and the Department 26 Murphy in 27 28 1981 received a bachelors and a doctorate on in labor economics the determination Professor of the University of from the University of California degree in economics from the University in by skill and occupations 20 Case No 11 CV 02509 LHK ORDER GRANTING IN PART DENYING IN the Booth Professor 1986 Los Angeles Dr Murphy wages and compensation His has addressed the market determinants of wage industries Chicago of Chicago labor markets and the determinants of of relative wages across Economics in Economics at degree in economics has published extensively work of PART MOTION FOR CLASS CERTIFICATION level as well as Case5 11 cv 02509 LHK 1 Plaintiff 2 exists to prove impact 3 proceeds to consider must provide properly on Dr a class 5 In support 1 the analyzed reliable evidence wide basis Id emphasis and Leamers documentary d 4 Filed04 05 13 Document382 added statistical Plaintiffs 7 Defendants enforcement 8 procedures regarding 9 Defendants 10 documentary 11 interrogatory responses 12 human resources 13 Google and of the anti solicitation agreements in preserving interest from the Accordingly and 2 policies documents 1 deposition 2 declarations evidence related 3 Defendants In opposition Defendants Plaintiffs of proof the Court compensation and compensation including internal equity named common method evidence cold calling and increased recruitment retention 53 forth documentary evidence addressing these subjects including recruitment of Antitrust Impact set to link between and impact 6 California that a Documentary Evidence Showing of proving class wide Page21 submit that their show own transcripts and from top management recruitment compensation and benefits departments and and 3 documents in their from Court of 14 District Intel regarding Having reviewed compensation and benefits the parties common materials the Court finds that Plaintiffs evidence District Dr Leamers 15 supports 16 able to prove antitrust theories regarding price discovery and internal equity and is likely to be States injury to at least a portion of Plaintiffs proposed Classes Northern United the For 17 i Much 18 of the common 19 whether members of the 20 All Employee Class evidence set forth by AllEmployee Class were Plaintiffs would apply to the question agreements 21 First Plaintiffs 22 show 23 lawsuit as 24 set forth contemporaneous that Defendants viewed winning a significant the talent competition for problem Adobe war Shaver Decl impacted by Defendants of documents from Defendants workersincluding for anti solicitation against example was concerned internal files which other Defendants in this about whether it was Ex 14 25 26 27 Shaver Decl Ex 15 28 21 Case No 11 CV 02509 LHK ORDER GRANTING IN PART DENYING IN PART MOTION FOR CLASS CERTIFICATION see Case5 11 cv 02509 LHK 1 2 Recruiting 3 as crucial 5 34 Google email How to Wars Second 4 Ex Decl also Shaver Filed04 05 13 Document382 with sharing a 2007 Forbes of article 53 The entitled Talent Beat Google to Tech the evidence indicates that Defendants viewed recruitment including cold calling growth to growth and development staff Page22 their For instance in order to support Googles rapid 6 See Decl Ex 25 7 8 on our dont 10 Human Resources 11 Decl 12 asset is people 78 Officer emphasized that 9 California Harvey at call list at So c old calling Shaver Adobe Q Why Ex 1 is In response to concerns over slow hiring Googles into companies Decl Ex 42 described an recruit is to be expected unless Donna Morris recruiting talent as recruiting talent important to really were to the Senior Vice President critical A Adobe property based intellectual Chief Culture to theyre of Global company growth Harvey So our critical most critical company Court of 13 14 District District 15 States 16 Id Intel estimated that historically Northern United the For 17 competitive sourcing including 18 Harvey Decl Ex 27 cold calling and research and stated in accounted for its 19 20 Third 21 would 22 target to look 23 the evidence indicates one anothers solicit into u nfortunately employees Adobe personnel recognized Chizen CEO of Adobe 24 agreement not to poach each others 25 PayPal were 26 emailed Google 27 candidates 28 eBay PayPal and lifted but knew for the purpose of recruiting Bruce from Googles do stating from these two companies the potential not call CEO Steve Decl Ex 13 list Googles any roles within No Jobs have a gentlemans Relatedly as soon as eBay and Director of Staffing Google IN Operations hundred leads and Given the history with recruiting activity directly to you 11 CV 02509 LHK ORDER GRANTING IN PART DENYING a great not do so because 22 Case companies Apple would be staffing is ready to pursue several for various escalation of that that they could and Apple talent Shaver CEO Eric Schmidt hightech that but for anti solicitation agreements PART MOTION FOR CLASS CERTIFICATION are there any Case5 11 cv 02509 LHK 1 directions 2 contacting 3 good point So 4 Fourth or sensitivities talent that as not to Plaintiffs you would like the staffing Decl Ex 33 Shaver Filed04 05 13 Document382 Google response In team CEO Eric have offered evidence indicating could lead to higher wages for employees 6 President Ed Catmull e very time a studio 7 structure 8 leave to grow at to believed seriously budget Id that increased As expressed by grow rapidly it Yes Pixars messes up the pay the rate they desire people will hear about it and Decl Ex 61 Shaver Fifth Plaintiffs have 10 transmit 11 California high salaries tries and begin sourcing Schmidt stated that Defendants competition for workers 9 53 an avalanche can you please propose and manage to a create offering of we to follow as 5 By Page23 which 12 response to Googles 13 set forth evidence showing that cold and could solicitation who elsewhere salary information that spread well Dr Leamers supports beyond any single calling price discovery theory decision to make counteroffers As to individual noted by one Google some employee in who were individuals a job offer received recruited to go Court of 14 District District 15 States 16 Northern United the For Id 17 18 Plaintiffs have also set forth evidence indicating 19 internal equity 20 employees and counter offers to retain existing that Defendants as one factor in determining compensation generally when making employees In did consider offers to attract making offers Adobe new for example 21 22 23 Similarly 24 25 Harvey Decl Ex 20 In response 26 27 Id Intel even had a computerized program that would run an 28 23 Case No 11 CV 02509 LHK ORDER GRANTING IN PART DENYING IN PART MOTION FOR CLASS CERTIFICATION Internal Case5 11 cv 02509 LHK Document382 Filed04 05 13 Page24 of 53 Case5 11 cv 02509 LHK Filed04 05 13 Document382 Page25 53 of 1 2 Decl Ex 23 Harvey 3 4 5 6 7 Id 8 9 The evidence Defendants structured the agreements to apply to eg Shaver Decl Ex 17 10 or 11 Board at Intuit to Apple 12 all efforts 13 Eric Schmidt 14 the policy 15 Adobe and Apple 16 California geography See Shaver Decl Ex 17 solicit 18 President 19 well follow a gentlemens agreement 20 is we 21 them CEO Steve anyone from to recruit up wages also indicates that to avoid bidding wars that could drive Jobs all employees a 2005 email from Google stating that Apple regardless of job type department Shaver Decl Bill Campbell Chairman of CEO Eric Ex 56 Schmidt the firmly stopped a 2007 email from Google CEO Court of District CEO Paul to Intel was created Otellini Shaver stating that Decl Ex 19 Intel has been on the a 2005 email between Do Not Call list since CEO of Bruce Chizen then District CEO Steve Jobs agreeing not to solicit any employee from either company States 60 a 2007 email showing that Lucasfilm and Pixar has an agreement not to Northern United the For employees each others of Human wont Resources directly solicit see also Harvey at Shaver Decl Ex 66 Pixar to Pixars recruiting with Apple that any Apple employee Decl Ex 25 at a 2007 email from Lori McAdams Vice is team stating that effective similar to our Lucasfilm recruiters now agreement That including outside recruiters from communicating if we use 13 22 23 These anti solicitation 24 another 25 employee had 26 companys Google agreements prohibited employee whether not otherwise applied for recruiters are strictly following orally in writing telephonically a job the opening Do Not 27 called networked or emailed into the company or 28 Decl Ex 53 We cannot recruit including eg Call policy its calling See Shaver regarding subsidiaries up looking or electronically emailing or enticing talent in No IN ur Shaver any way 11 CV 02509 LHK ORDER GRANTING IN PART DENYING that and no one has Intel for if O Decl Ex 25 25 Case directly with PART MOTION FOR CLASS CERTIFICATION current Case5 11 cv 02509 LHK 1 Pixar employees 2 beyond 3 each others 4 company even 5 would be 6 current employer 7 to come Intel However some of for on recruitment prohibitions Pixar and Lucasfilm 2 to notify employees each other when employee applied that if work to for a job final and would not be improved were incidents in 8 from employees of the other Defendants 9 example 2007 Apple personnel on upon whether Lucasfilm or Pixar In addition there in Filed04 05 13 Document382 his or her A senior 11 California for a position Apple through a job posting stated 12 13 terminate but called the employee to solicit the other 3 that any offer initiative and offer by refused to consider the persons on applied their job applications own human resources manager mutual agreement guidelines and asked that he contact that she 1 not to ensure he is still an me For initiative who from an Adobe employee an application discussed agreements reached employee of offer to an to a counter the employees if 53 Decl Ex 60 which Defendants even Defendants own in response Shaver of example agreed making an 10 at for Page26 applied from Apple Adobe employee explained our should his employment with Adobe Court of 14 District at Indeed this time I am unable the sustained personal continue to efforts by exploring with him the corporations own Decl See Harvey chief executives Ex 21 including District CEO Steve 15 but not limited to Apple 16 Intuit 17 agreements indicate that the agreements 18 For instance when 19 2007 Apple 20 would be very 21 Google responded by making CEO Eric Jobs Google Schmidt Ed Catmull Pixar President States Chairman Bill Campbell and CEO Paul Intel Otellini to monitor and enforce these Northern United the For 22 23 Eric Schmidt 24 Clara 25 actively 26 recruiter 27 28 a recruiter from Googles CEO Steve if recruit a hour Decl Ex 35 from have had broad effects on Defendants employees message the Intel example public Id Also after in learning Eric Schmidt If we to Google CEO Eric that Intel CEO Paul Google was confirmed Otellini wrote recruiting Intel exceptionally Finally based on the evidence it anti solicitation agreements would lead No seriously Shaver IN the Decl Ex 50 appears that Defendants recognized that eliminating to CEO do es not will terminate greater competition for employees the and require enhanced 11 CV 02509 LHK ORDER GRANTING IN PART DENYING Google with Paul Otellini that Google we terminate employees in Santa 26 Case to to I Decl Ex 24 Shaver out of the recruiter and decided 2007 in Schmidt and stated this find that a recruiter called into Intel take these relationships an Apple employee engineering team contacted your recruiting department would stop doing asking for help Shaver We pleased jobs forwarded within the the recruiter may PART MOTION FOR CLASS CERTIFICATION Case5 11 cv 02509 LHK 1 incentives 2 agreement between 3 Intelligence 4 the extent 5 Apple dialup 6 assist 7 Filed04 05 13 Document382 Dr Leamer of 53 975 for retaining Adobe and Apple ended Group reported the volume on in retaining and recruiting that the high tech sector Adobe 8 employees For example Page27 2007 someone from retaining top talent Adobes will likely Adobe resources top talent the See Leamer DOJs Rep what changes 88 citing investigation antitrust the anti solicitation Competitive be more competitive As Microsoft remains economically healthy attracting Notably two months after in reports that after or new Google and approaches would ADOBE004964 in this to 004997 at case was made public 9 10 11 California Shaver Decl Ex 46 In an internal email 12 Court of 13 14 District District 15 States Decl Ex 48 16 Shaver 17 mechanisms behind contend that Plaintiffs t his documentary evidence confirms the Northern United the For 18 that agreements effect on compensation Collectively the Court finds that these documents how 19 theories about 20 Mot provide 19 at support for Dr Leamers Employee Class the anti solicitation agreements could 21 Technical ii 22 Despite all of this evidence which 23 Court recognizes 24 may 25 the proposed Technical 26 attracting 27 presentation entitled 28 was to focus on Case No have affected top that some have impacted Class Plaintiffs proposed supports Class First cold calling appears to have eg Shaver Decl Ex 14 Global Talent Attracting passive AllEmployee Class of Plaintiffs evidence indicates that the anti solicitation only a subset of Plaintiffs proposed Classes which talent See or nearly all of the All all talent which it stating Senior Talent defined as may or correlate been particularly important for in an that Adobe power a way top performers to who point source top talent tend to be entrenched 27 IN agreements may not 11 CV 02509 LHK ORDER GRANTING IN PART DENYING the PART MOTION FOR CLASS CERTIFICATION to Case5 11 cv 02509 LHK may be 1 but 2 14 demonstrating that Bruce Chizen 3 Adobe 4 willing to listen if the right opportunity open season 5 a point Knowing 6 it in a way 7 8 Steve he will go in which they will be enticed Second some evidence employees See of technical to will deliberately of our top come Mac Harvey if top talent I tell Adobe poach Decl Ex packages and Steve just to prove do wooing were particularly concerned about the loss eg Shaver Decl Ex 45 9 10 11 California Defendants 12 Apple and 13 rather than to avoid Intel NOT agreed simply to hire top talent away from each other esp technical Court of 14 District anti solicitation all efforts Plaintiffs evidence also indicates Shaver Decl that Defendants Ex 55 may have been more concerned about District 15 enforcing 16 than other categories 17 appears to have actively monitored 18 about Googles groups and engineering teams recruiting from Apple 19 Ex 20 I the anti solicitation agreements for some categories of employees such as engineers States employees such of as administrative For example Steve Jobs assistants Northern United the For software 25 showing that am told in that Googles 2006 sic 21 group 22 recruiter from Googles 23 forwarded 24 department would stop doing 25 Engineering 26 employee that If this new is indeed true can the at and enforced the anti solicitation agreements when Apple cell you CEO Steve phone please engineering team message to Eric Schmidt this for a project group software put a stop to tried to I it See Shaver CEO Eric Cook would be okay to pleased if Vice President make an assistant position 28 IN a of Software offer to an Apple 11 CV 02509 LHK ORDER GRANTING IN PART DENYING after your recruiting 28 No Schmidt stating Decl Ex 24 27 Case Decl employee in 2007 Steve Jobs would be very coordinator administrative he learned relentlessly recruiting in our iPod it Shaver when Rob In contrast is recruit an Apple and wrote Pixar asked Steve Jobs whether applied Jobs emailed Google PART MOTION FOR CLASS CERTIFICATION if Steve talent like Chris Cox and he will extraordinary that Defendants indicates see also agreement with Apple specifically some after 53 of had concerns about the loss of managers he other than senior Page28 presented is CEO of Adobe did not enter into an anti solicitation Jobs its Filed04 05 13 Document382 Steve Jobs Case5 11 cv 02509 LHK by saying Yea 1 responded 2 emphasized 3 Rob Cook to Defendants also its may fine the that Decl Ex 68 Ed Shaver key is to stay employees without necessarily making changes 5 example noted in 6 adjustment our underpaid engineers 7 we want for to send 8 new 9 PIX00049648 10 who hires framework 11 650 The email 12 the 13 at support the 15 hearing that the Technical Plaintiffs provided little that we Id President 9 Dr Leamer for an across the board author of the email states value them from other at least matrix to leveling as much companies Id as some citing give us a consistent engineers Id of our software Class as an alternative class to be the Technical discussion engineers 124 The further refers to using a Plaintiffs proposed 53 CatmullPixars Pixar email discussed offers the expected contribution for evaluating 14 California competitive of to adjust the salaries of certain groups of Rep Leamer to these engineers much more the Page29 to all other job categories an internal report that clear message are seeing Although Court a away from have been more inclined 4 his expert Filed04 05 13 Document382 or analysis to support Class definition this by certified See Mot Court of District 25 In addition Dr Leamers expert two proposed Classes See report generally does not differentiate between eg Leamer Rep 12 Plaintiffs evidence to explained during the District Class was intended address to the Courts concerns about potential States 16 by focusing on cohesiveness the job titles of people working in software technical and creative Northern United the For Tr 22 11 21 17 positions 18 Tr at 20 21 19 such an expansive impact as to affect 20 proposed Class is not at Nonetheless Perhaps unsurprisingly data 21 Defendants dispute all driven Tr iii Plaintiffs believe the impact at 140 was broader than that that the anti solicitation or nearly all of the Technical agreements had Class and contend that this 58 Defendants Common 22 that Evidence in Opposition to Proving Impact Defendants have submitted evidence to demonstrate why they believe that individual issues 23 predominate over common ones for the purpose of assessing antitrust impact 24 Defendants first contend that individualized because in order to identify likely to receive a cold call but for issues predominate 25 who was injured the Court will have to 1 who determine 26 27 28 9 Of course the compelled fact that Pixar Vice President to get approval weigh in favor of finding Rob Cook from Steve Jobs before was and Pixar President Ed Catmull even hiring an administrative that these agreements had a much broader impact 29 No 11 CV02509 LHK ORDER GRANTING IN PART DENYING Case IN PART MOTION FOR CLASS CERTIFICATION felt assistant seems to Case5 11 cv 02509 LHK 2 who 1 the agreements 2 enough 3 have taken that offer and 4 Tr at 15 1621 19 1 4 To 5 depositions 6 current employer 7 raise as a result of an offer 8 or after 9 Oppn some to get it would have accepted moved end made to 1 any named 2 any another See Oppn higher at Plaintiff named the phone 5 an offer and wage with 8 10 see also 456 Decl call far who would his or her boss See 11 aware 12 companies and websites 13 backgrounds 14 factfinder 10 at claims a salary increase to have received at his a a cold call or otherwise before during A Brown of Christina depositions Stover Fichtner and Marshall Further Defendants note of competitive salary levels from multiple ever negotiated Plaintiff employee from Brown Decl ECF No 215 Exs 3 Oppn 53 of would have taken received a 10 California Page30 Defendants highlight that based on the named Plaintiffs based on a cold call or period would have jobs or tried to negotiate does not appear that the class 3 who the call 4 who salary information that Filed04 05 13 Document382 that named of Plaintiffs sources including In Supp Defs Hariharan Plaintiffs admitted they were friends contact other at Defendants also assert that Plaintiffs different Court of District show wide the would have variation employees in to assess to determine and circumstances qualifications that a impact District 15 In addition Defendants argue that b eyond trying to show that someones salary was States 16 reduced by a missed cold call would 17 evidence that a raise for one employee would produce raises for all 18 Specifically 19 concerned 20 automatically Plaintiffs face the impossible task of showing with common Northern United the For 21 22 23 24 25 Defendants argue that there with drive snippets which distort See Oppn at Decl 26 of Mason concrete an Stubblefield in across all Oppn job categories showing as consisting that Defendants actually For example Defendants note that objective at of equal so 1 mere documentary its internal managers Brown that Decl Ex 19 of Intuit 27 that they have submitted to the Court 28 the purpose of attracting and retaining shows that they considered that Defendants top talent internal equity the evidence were willing to make exceptions For example an Intel powerpoint 30 No 14 would placed on instructed Intuit since talents and markets are not Defendants also assert that to the extent Case at evidence that each Defendant was one employees compensation Plaintiffs evidentiary the limited importance 18 internal equity is not no increase raises for all employees Defendants characterize equity an internal equity that is employees Id 11 CV 02509 LHK ORDER GRANTING IN PART DENYING IN PART MOTION FOR CLASS CERTIFICATION for presentation Case5 11 cv 02509 LHK 1 shows Offer Development Philosophy considers 2 competitiveness and internal equity 3 internal equity 4 this does not that Intels 5 for scarce mean we In contrast to talent and will elevate 7 reality their compensation 8 compensation 9 different managers Oppn 1720 at who policies Leamer According were directed 12 necessarily affect 13 Wagner 14 company 15 16 16 its 17 scope reward high achieving to Intel may to Defendants might have to push pay more for critical skills match Brown Decl Ex 27 somewhat 200 1 17 at 53 position market we rigid wage Defendants contend that in and practices were highly individualized compensation with wide variation was set by hundreds in of to Oppn managers s that skilled employees to Dep of the candidates recognize also a lthough and Page31 hypothesis about Defendants 10 California skills Decl Ex 1 structures see Brown but that Intel non critical Dr Leamers 6 11 Filed04 05 13 Document382 at 6 8 18 In other words Defendants employees such that pay raises employee the salary of another See instructed one employee might not to eg Brown Decl Ex 21 Decl of Frank Court of District of Google 5 Google that top performers create believes and Google thus seeks to reward exponentially its top a value to the disproportionate performers Brown Decl Ex District Decl of Steven 3 Burmeister of Apple Apples general philosophy has been to compensate States employees based on their individual contributions to the company and differences in their job Northern United the For responsibilities 18 declaring 19 consistency 20 that at and experience Decl individual Intuit of Mason salary increase determinations with salaries elsewhere in the company or Defendants 21 employees 22 Decl Ex 22 Decl 23 the divisions 24 left 25 Decl 26 outside 27 compensation salary declarations would salary in the divisions also support not necessarily of Michelle Maupin budget Therefore of the of Lucasfilm if recommended 9 Decl of Intuit that in the short term an 34 See All salary increases one employee receives a must Brown come out salary increase less stating that although a manager at money she must stay within 11 CV 02509 LHK PART MOTION FOR CLASS CERTIFICATION of is division Apple may go budgets IN eg the salaries of all other employees of that salary range for a particular job ORDER GRANTING IN PART DENYING in one increase 31 No for otherwise 28 Case 19 are not reviewed affect the salaries of everyone else salary budget to increase of Steve Burmeister of Apple finding Stubblefield her overall Case5 11 cv 02509 LHK 1 Further Defendants note that 2 handle counteroffers 3 Lucasfilm gave managers 4 Adobe and 5 Pixar 6 Lucasfilm 7 Stubblefield 8 9 had Intuit 23 Ex 17 discretion Decl 37 Ex 14 of Intuit of set to vary individual Decl Ex 23 See Oppn Brown of Danny McKell 12 of Mason 13 raise for one employee would produce 14 Defendants salary structures 15 manager would handle compensation decisions citing Decl 10 Ex 21 Decl of of Intel Stubblefield Decl of Decl and other factors McAdams Lori of Michelle 28 29 Ex 19 Decl Intel and Maupin of of of Mason varying compensation ranges for certain jobs such 11 California Ex 23 11 Ex 22 of Intel each manager was directed to 18 had broad discretion 78 Brown Decl 10 at how 53 of based on performance Donna Morris of Adobe of Defendants also contend that they that managers in Page32 by other employees While Pixar solicited See Danny McKell Decl varied make counteroffers to guidelines specific policies their who were employees to Filed04 05 13 Document382 10 of Intuit Therefore compensation even up of Lori McAdams 100 to or more 9 Ex 17 Decl of Pixar 13 30 Ex 19 Frank Wagner of Google Decl Defendants argue that determining whether a Court of District raises for all employees and policies practices would require examining as well as assessing how an each individual District of these issues Defendants In light argue that States 16 there is no common evidence to help Plaintiffs make the leap from a salary increase for someone Northern United the For 17 in the accounting 18 receptionists 19 department Oppn to the salaries of software Bang 21 salary increase 22 inhouse counsel or 14 at Finally Defendants emphasize that despite 20 engineers Plaintiffs heavy reliance on Googles Big Id 23 to show class wide impact Oppn The Court at 20 recognizes there is no evidence that other Defendants Defendants contend that the Big that some 24 questions 25 evidence Defendants have presented 26 Defendants own employees 27 for Class Certification 28 1061 of the issues raised ND Cal 2007 However much to rebut Plaintiffs contentions declarations In re Wells unusual and by Defendants may about whether any particular employee was injured Cf Bang was followed Googles raise individual of the documentary arise in the context which were drafted specifically to oppose Fargo Mortg Overtime Pay Litig 527 scrutinizing carefully declarations from Defendants No IN Motion 2d 1053 employees that 11 CV 02509 LHK ORDER GRANTING IN PART DENYING of this F Supp 32 Case unique PART MOTION FOR CLASS CERTIFICATION Case5 11 cv 02509 LHK 1 appeared 2 documents 3 to CEO emails 4 of 5 equity is more persuaded by powerpoint presentations the internal the anti solicitation 53 of contemporaneous agreements compensation and recruitment regarding and interoffice communications departments resources Page33 such as CEO from the heads about internal concerns that corresponded to compensation decisions Thus 7 finding 8 prove 9 compelling that the Court finds that Plaintiffs documentary common issues predominate impact Nevertheless antitrust may not be sufficient to over individual e 12 show documentary examples though and support were or empirical by affected the analysis Evidence Statistical offers econometric in favor of ones for the purpose of being able to that all or nearly all Class members Econometric and Dr Leamer Finally evidence weighs heavily the Court has concerns that Plaintiffs anti solicitation agreements without additional 11 California The Court by Defendants before and during created Defendants human 6 10 driven litigation Filed04 05 13 Document382 statistical which he asserts bolsters evidence Court of his conclusion 14 District 13 show proposed Classes were impacted by Defendants anti solicitation agreements that class wide evidence can that all or nearly all members of Plaintiffs District Dr Leamers 15 statistical evidence consists primarily of three different categories of States 16 evidence The 17 regression analyses 18 Leamer first category evidence upon which of statistical Dr Leamer consists of relies Northern United the For 19 Rep which firmwide compensation time over Leamer 21 maintained 22 Leamer opines rigid structures Rep wage that the Court refers as Dr Leamers 11 14 Dr Leamers Common Figures 20 23 to it and the formulaic 128 Dr structures may be factors such 25 broadly experienced by 26 way Leamer contends based on principles of move to Analyses Factors See Analyses assess Defendants in which total compensation was varied that this is evidence that Defendants of internal from the existence inferred compensation of Class members tended 24 Factors Common equity of these rigid together See id wage 130 Dr structures that over time and in response to common Id 27 28 that Second Dr the effects all Leamer consistent with important the or nearly all anti solicitation members offers evidence to elements of equity in of the show a Agreements would be expected AllEmployee Class and persistent salary structure the Defendants compensation No 11 CV 02509 LHK ORDER GRANTING IN PART DENYING IN across practices 33 Case Technical PART MOTION FOR CLASS CERTIFICATION to be Class employees Leamer Case5 11 cv 02509 LHK Dr Leamer 1 Rep 2 salaries and total 3 top 10 positions at Google between 4 these five charts 5 these charts 6 together 134 134 7 as 9 all e i Dr Leamer evidence this engineers id Figures 15 17 Finally Dr Leamer 11 show 12 generally and 13 proposed Class i 14 the Class period 15 Plaintiffs this model 16 and defendant bydefendant 17 allows the effectiveness 18 workers Id supplies that the anti solicitation agreements had 2 quantify amount the total refers to contends that See id a raise so did account executives t he non compete opines that agreements which have effects that would spread across model the salary structure Conduct Regression some impact on of the impact the tended to move for different positions received a regression The Court Charts Dr Leamer focus on subsets of workers would nonetheless to 2006 and 2009 and Apple between Compensation Movement software if 53 of which purport to track changes in the base at 2005 and 2009 See Page34 or almost all employees at the firm in order to maintain the overall 10 California positions offer further evidence that compensation Based on might tend five charts 10 the top for Dr Leamers over time 8 on specifically relies compensation Filed04 05 13 Document382 the Class e impacted i Id 1 to the Class damage experienced by each or Court of District e the total or net reduction Rep See Leamer Figures in Defendants 20 24 expenditures on compensation during Conduct Regression 10 According to District estimates undercompensation for Defendants employees on a year byyear States Mot basis at 23 Rep Leamer citing 145 Fig 22 The model Northern United the For 19 of the agreements to vary over time Leamer citing Defendants argue that 20 several respects 21 1622 see also As 22 to and fails Oppn the at Dr Leamers and econometric statistical evidence for Plaintiffs theory support is See deficient Mot to in Strike at 20 21 Common Factors persuaded that these analyses 24 solicitation agreements 25 Conduct Regression 26 plausible of different kinds of 146 Rep to provide persuasive 23 method and among Analyses and Compensation support Dr Leamers would have spread contention to all or almost all Movement that the detrimental effects is not that the effects of the anti employees With the Court is not persuaded that the Conduct showing Charts the Court Regression respect by to the itself provides of the anti solicitation agreements a were 27 10 28 Dr Leamer Technical prepared separate regression analyses Class The Court refers to both regressions for the AllSalaried Employee Class and Conduct Regression collectively as the 34 Case No 11 CV 02509 LHK ORDER GRANTING IN PART DENYING IN PART MOTION FOR CLASS CERTIFICATION the Case5 11 cv 02509 LHK Filed04 05 13 Document382 or nearly all Class members Nevertheless 1 experienced by 2 Conduct Regression provides 3 agreements resulted in Defendants expending less 4 otherwise i 5 by which Defendants 6 to the e all 1 showing money on Court addresses 7 Common i Dr Leamer sets forth i each of these evidentiary Common 10 According move a measure models Dr Leamer approximately to 11 California 12 Court of 13 company gender Dr Leamer location title Analyses which he uses contends that the 90 percent factors compensation District at any point in time can be explained 15 of Class members tended to the compensation States 16 Northern United the For common the Class as a Id whole Defendants contend that Dr regressionstheir ability to 20 employee works and factors in any individual age number 128 employees months in of see also are significant id Figures 11 14 because if may it the Class members be inferred over time and in response together Common Factors Leamers 19 fit of these common to by common variables move that compensation that to would have affected 130 18 the show to to one Class members compensation factors such that a detriment 17 such as Common Factor Analyses 14 District of the variation employer Leamer Rep and damages of class wide turn in over time and in response by common can be explained compensation amount the Factors Analyses Factors together than they would have 2 quantifying 9 of Class members tended to 53 that the anti solicitation compensation e providing were reduced expenditures of the Court is persuaded that the Conduct Regression shows impact generally and the Class The 8 method of a reasonable Page35 his job title Oppn at explain is 20 Analyses prove nothing because almost entirely attributable In critiquing Dr Leamers where to the model Dr Murphy 21 contends that the regressions 22 what an employee does and simply reflect whom that in these labor markets like all competitive 23 indicative 24 Common of a rigid Factors wage much she works for explain Id structure Analyses cannot as citing Murphy Dr Leamer Rep of her 89 92 claims establish titles are correlated with each other over are not Defendants argue that the that compensation 25 employees with different job compensation and ones time such that of different it may be 26 inferred 27 that an impact members Oppn at 21 to one Class member quoting Leamer would have Dep 206 421 necessarily rippled out to other Class The Court agrees 28 35 Case No 11 CV 02509 LHK ORDER GRANTING IN PART DENYING IN PART MOTION FOR CLASS CERTIFICATION Case5 11 cv 02509 LHK 1 Accepting arguendo that the 2 factors such as where 3 determining the employees 4 from this fact that Defendants 5 with entirely different 6 impact 7 in entirely different jobs 8 Indeed during his deposition 9 show salaries of that the time 10 11 California over 11 12 13 salary 12 correlated 13 Compensation 14 53 of 11 Analyses are accurate e i that were so move necessarily would title they show may be that through time such that a detrimental to other employees the entire salary structure Common Analyses did not Factors the regression analyses two employees with two A Thats inferred for employees different job titles are correlated salaries of with each other over time correct it that compensation ripple across Q But 235 21 236 2 you whether tell together admitted that the two employees with two at rigid how explain fails to necessarily result in an impact any impact would Dr Leamer Dep dont However Dr Leamer salary structures would titles See Leamer and Common Factors Page36 an employee works and what an employee does play a large role in an employee with one job to Filed04 05 13 Document382 And correct with each other reflected different job titles are why we thats in Figures did the Court of 14 District Charts Movement Accordingly the Court agrees with Defendants that the Common Factors Analyses do not District Plaintiffs theory that all or nearly all Class members compensation 15 support 16 have been impacted by the anti solicitation would necessarily States agreements Northern United the For 17 18 In addition 19 Movement 20 to 21 move that 24 25 26 11 an opines that an increase Movement predict conclusion the the accuracy of the named that the at rigid linked wage structure Because Factors Movement Charts in the to Strike Motion to 22.12 at Analyses noting No at 20 21 In Dr Leamers Strike identify flaws in in addition of the theory of a Dr Leamers to the admissibility 11 CV 02509 LHK IN light issue that affect the persuasiveness ORDER GRANTING IN PART DENYING The Court that they fail to 36 Case do Charts is misplaced some years See Oppn this Defendants contend flaws and that the charts Analyses would not support the Court need not resolve Defendants arguments Compensation Factors 20 22 Mot Movement Common Plaintiffs salaries in Common one Class member would Charts suffer from several See Oppn Leamers conclusion in salary to in salary for the rest of the Class increase Compensation Defendants contest accurately 12 28 He to the Compensation provides evidence showing that compensation for different positions tended agrees that Plaintiffs reliance on the Compensation Courts 27 additional translated Dr Leamers Dr as Analyses Dr Leamer Common Factors over time together not support to the Charts necessarily have 22 23 Compensation Movement Charts ii PART MOTION FOR CLASS CERTIFICATION of Case5 11 cv 02509 LHK 1 First as noted by Defendants 2 compensation 3 companies 4 seven Defendants 5 exclusively 6 on whether compensation 7 an 9 Mot selected a small fraction at an for 11 discussing more in in the Technical eg disparate titles his deposition positions movement that Dr Leamer 12 stating that he was aware 13 he had decided 14 clear that the 15 of all Class members 16 positions at 17 positions moved 18 compensation 19 light 20 Compensation 21 Class members for a custodian an at shed these charts little light office in Texas Intel and over time some Leamer for the charts Apple all appear to be almost titles Thus Class two titles at id job titles see Dep at results but that consistent 262 3 10 275 13 18 at not of the positions Charts would not show the same anomalous there might be 20 job which were spread across admitted that Movement were selected of compensation Charts only examine the the Classes Furthermore these job in the Compensation 20 as the 21 included 53 of of the total Class approximately office in California moved together Intel for inclusion movement titles would be included that titles to Strike at Moreover during 10 California for Page37 Movement the Compensation out of the thousands of job engineer 8 movement Filed04 05 13 Document382 Dr Leamer in the heat of the moment Court of District to 20 assume that positions would be the anomalies reflected on 13 resolved the chart are representative Consequently of the compensation it is not movement District Indeed Dr Murphy expanded Dr Leamers analysis to include the top 25 States each of the seven Defendants and found that in any given year compensation for these Northern United the For for others to provide a broader Even Movement Charts moved putting compensation for rose and by different percentages of Plaintiffs failure 22 eg in different directions together some See Murphy sampling the Court are particularly probative positions is fell while Rep Ex 18A 18B In not persuaded that the of whether salaries for all or nearly all over time by aside the small sample size provided 23 the Court is not be persuaded that the Compensation 24 compelling evidence regarding Movement the Compensation Movement Charts provide Charts particularly Dr Leamer whether salaries at each company were linked 25 Dr Leamers 26 28 Defendants arguments here 13 27 conclusions based on these charts the Court will consider During his deposition of other job titles that Leamer stated that it Dr Leamer may not be was asked whether consistently the fact that smooth over did not but only because he did not know of the thousands of omitted positions was not consistently there are significant time affected his opinion for sure that the smooth Leamer 37 Case No 11 CV 02509 LHK ORDER GRANTING IN PART DENYING IN movement Dep PART MOTION FOR CLASS CERTIFICATION at 3 17 numbers Dr of any Case5 11 cv 02509 LHK 1 admitted that the allegedly 2 3 rigid wage structure inferences 4 may that movement parallel Leamer Dep at reflected 283 23 25 above Movement 6 for all or nearly all employees in either the All 9 Finally Dr Leamer had some impact on e i 11 compensation 12 a range 13 company 14 Effects 15 number 16 California on e impacted of the impact average or net under compensation 17 were in effect the Class 14 Plaintiffs argument that compensation the Technical Class were linked Conduct Regression i 10 Charts Employee Class or uses a regression model the Class non also consistent with a This admission seriously undermines any Charts provide sufficient evidence supporting iii 8 is 53 of the Court does not find that the Compensation 5 7 Page38 in the charts be drawn from the Compensation Movement of the issues discussed In light Filed04 05 13 Document382 to show the Class generally and to quantify the total or net reduction during the Class period that the anti solicitation in Rep See Leamer Defendants Figures of variables designed to account for factors including agreements on expenditures 20 24 amount the total This model incorporates 1 age sex and years at the Court of District 2 the effects 3 the and on compensation caused by effects caused by the anti solicitation agreements factors specific eg to each Defendant Conduct the firm revenue total District of new hires etc See id Figs 20 23 Dr Leamer uses the model to estimate the States at each firm during the period in which the DNCC Agreements Northern United the For 18 See id Fig 22 and The Court is 24 Reply 33 at persuaded that the Conduct Regression generally 19 that while the antisolicitation agreements were 20 compensation 21 amount by which Defendants were under compensating were less than they should have is capable of effect Defendants total been and 2 providing an estimate in their employees 1 showing expenditures on of the net class wide damages 22 23 24 25 14 The Court that salaries between 26 28 between by also concerned moved together 2007 and 2008 sample period the directions 27 is total See Leamer in the fact that the Compensation Movement Charts every year Significantly one of the three year long periods with respect to the Apple shown on the chart or compensation for almost half of the positions Rep Fig 15 showing 2007 and 2008 while total total compensation moved compensation for approximately six positions 11 CV 02509 LHK ORDER GRANTING IN PART DENYING IN percent of the in different 38 No show positions 33 went down rose Murphy for four positions Rep Appx 8B same Case did not PART MOTION FOR CLASS CERTIFICATION Case5 11 cv 02509 LHK 1 Defendants argue that the Conduct Regression 9 Oppn 22 24 As will be 2 Strike 3 arguments The Court at 4 5 6 at addresses Dr Leamer because of variables 8 sensitive 9 Leamer is an Dep exploration at first purported 10 decision 11 to Strike at 12 analyses 13 argue that when 14 different results 15 no undercompensation 16 Adobe 17 Page39 in a number of 53 Mot of respects the Court is not persuaded to by Defendants each of the flaws identified by the Defendants in turn 351 4 6 sensitivity how of See flawed and should not be admitted Mot is Strike to the Court will identified at 11 A a models conclusions sensitive Defendants contend that the Conduct in at least three respects which The below flawed failed to conduct a sensitivity analysis analysis sensitivity forth set is contend that the Conduct Regression First Defendants 7 California Filed04 05 13 Document382 now are to a choice Regression is address by Defendants has do with to Dr Leamers Mot undercompensation to perform the regression using aggregate data from all of 12 Defendants contend that Dr Defendants employees Leamer should have performed disaggregated using only data from that Defendants employees for each Defendant See id Defendants Court of District Dr Murphy See id disaggregated the Conduct Regression 1213 Murphy Rep at 117 he received dramatically showed that Lucasfilm and Pixar finding District but instead overcompensation throughout the period Google States and Intel showed overcompensation in some years and Apple showed much smaller Northern United the For As 18 an initial Defendant matter 19 for each 20 Defendants using aggregate 21 included 42 additional 22 Leamer Supp 23 use of so many additional 24 model Leamer Reply 25 introduced 26 solicitation agreements 27 also in Dr Murphy Rather data from Defendant all Murphys See Dr Leamer generated However Defendants variables See Murphy Rep ECF No 247 Defendant specific Rep not appear to have created like specific Leamer Reply of Reply Dr Dr Murphy does single unlike out of the model 28 Murphy Rep Appx 9A of them The use minimize artificially the effects of the anti solicitation 116 100 As 42 Defendant model Decl specific IN E Edward testified the the variables related to the effect of the anti of so many of these variables may agreements by spreading those effects 11 CV 02509 LHK ORDER GRANTING IN PART DENYING of overwhelm ing 39 No for all Dr Leamer 28 Case models Dr Leamer Dr Murphy Rep variables runs the risk of 100 Moreover disaggregated a truly disaggregated PART MOTION FOR CLASS CERTIFICATION Case5 11 cv 02509 LHK 1 across 2 is 3 Moreover Dr Murphys analysis is often appropriate 5 may 6 Cir 2002 7 robust 8 Wholesale 9 Dr Leamer 10 any render findings amended In such a more stated 12 Moreover as this Rep size 53 of these issues the Court Dr Leamers may distort v aggregate F3d 1141 1148 California 291 allow for a v Costco results statistical appeal dismissed Jan the relatively short length to be a circumstance 9th more Defendants compensation by analysis and the statistical numbers may more meaningful particularly light of that the use of aggregate data in regression data regarding 99 In credible than ND Cal 2012 523 would appear Dr Leamer the use of Page40 101 probative Paige reliable and that the available limited Leamer Reply 2001 2011 Thus case FRD 492 285 11 California more a small sample where not statistically analysis and yield Corp are results the Ninth Circuit has recognized 4 Rep Leamer Reply a wider range of variables See not persuaded that Filed04 05 13 Document382 Ellis 16 2013 Here practices was of the data period aggregation may be appropriate where Dr testified the use of aggregate data allowed Leamer produce a to Court of 13 more coherent 14 District more Finally even model efficient if Dr Murphy Dep Leamer had developed at 364 8 365 7 models given truly disaggregated that the use of District may 15 aggregate data 16 at 17 that completely disaggregating 18 11 annual 19 scope of 20 that yield more reliable and more meaningful statistical results Ellis 285 FRD States 523 is it not clear that these models would be reliable See Leamer Reply Rep 101 stating Northern United the For observations for each Dr Leamers Dr Leamers the model would reduce Defendant and with so few The second 22 benchmark period 23 changed 24 solicitation agreements were 25 period then the model shows that there was net 26 compensation 27 to limit the 28 conduct data should be excluded because to Strike 13 at from the two years preceding benchmark period is in this to estimate No an error in his methodology is Defendants argue that Dr if the Leamers choice of a benchmark period Conduct Period to is over compensation not persuaded way only the two years following Defendants fail rather than to explain IN this under why it makes sense For example Defendants have not shown that the it is not comparable to pre data from the conduct period 11 CV 02509 LHK ORDER GRANTING IN PART DENYING of the the Court is not persuaded 40 Case a model and the two years following the period in which the anti in effect See id The Court Thus by Defendants identified sensitivity of observations to at most would be impossible constitutes 21 Mot number time series experiments failure to disaggregate alleged it the PART MOTION FOR CLASS CERTIFICATION Case5 11 cv 02509 LHK 1 Filed04 05 13 Document382 53 of Furthermore the Court observes that in altering the benchmark periods Defendants have 2 reduced the 3 previously 4 by 5 conduct that occurred over five years using only 6 that 7 in the data is 8 decision 9 Court that total amount the of data available may less data eliminating period Leamers is 12 over 13 variable specifically a variable that tracks 14 yielded 15 overcompensation a variable time Mot control for changes to to Strike 13 at are sensitive results benchmark 96 periods stating that the effect years and of his understanding discussed it is of the startling that the information Dr Leamers to does not persuade the flawed Defendants also contend that the Conduct to include as Rep to estimate non conspiracy in light periods Regression 11 See Leamer Reply Dr Leamers the fact that Conduct two As periods Dr Murphy is attempting data pre and post conduct to use both non conduct the results conduct such an exercise limited Thus Dr regarding in less accurate result preconduct Dr Murphy would 10 California Page41 Regression is in the value of flawed because equity compensation Dr Murphy Defendants contend that when Dr Leamer to introduced failed employees an equity Court of District much changes in the under compensation smaller for the SP 500 the Conduct Regression AllSalaried Employee Class and District for the Technical Class See Murphy Rep 138 This argument fails States As 16 an initial matter Dr Leamers a failure to include variable for changes in the value of Northern United the For S 500 s 17 the P 18 478 19 its 20 value of 21 reflecting changes 22 or 23 See Leamer Reply 24 results of 25 disregarded 26 Leamer used each Defendants 27 variable the model US at stock price does not 400 Normally make the Conduct failure to include admissibility Defendants have Dr Leamers in results the S P compensation Rather Dr it Rep Leamers 500 does the equity not track or variations 89 Thus variables will affect the fact reflect still Regression variations net in Defendants that including this variable is flawed Moreover significantly Dr Leamers the Court notes that should be when under compensation See Leamer Reply Fig 10 and 11 CV 02509 LHK ORDER GRANTING IN PART DENYING companies IN Dr an ostensibly more relevant 41 No prices altered the results 28 Case stock in the stock price of hundreds of unrelated average stock prices as a variable predicted the probative Defendants selected a variable variable analysis does not persuade the Court that or that the Conduct the analysis probativeness not not persuaded the Court that this failure affects Significantly tracks Regression inadmissible See Bazemore PART MOTION FOR CLASS CERTIFICATION 11 Case5 11 cv 02509 LHK 1 In addition to the sensitivity issues Dr Leamer Regression 3 employees within the same firm is correlated 4 Murphy 5 See 6 observations 7 certain 8 commonly 9 standard errors reveals 10 values are greater than flawed contends that given Murphy Rep 11 because used common estimate to clustering Conduct that the method a Leamers at Dr 126 errors take into account the fact that to of observations particular company by that are affected or present errors Dr Murphy are not statistically results 16 Murphy Rep should have clustered the standard groups contain the standard Strike for in a single year states that clustering significant because is the their p 5 Id Ex 22A finds that 12 sufficient basis to reject 13 have clustered the standard 14 Regressions 15 Court that the regression 16 California Dr that to Dr Leamer accepted a regression Mot See such as those affecting referred to as 53 of failed to account for the fact that compensation correlation A generally 126 factors The Court this Page42 above Defendants argue discussed 2 is Filed04 05 13 Document382 value 17 neither 18 epidemiological 19 Moreover 20 significant result 21 adjusting 22 See Leamer Reply 23 explain 24 variable revenue 25 the standard 26 not provide the Dr Leamers failure errors does not provide a to cluster the standard Conduct Regression Assuming arguendo Dr that Leamer should Court of District errors the fact that when are not statistically results the errors are clustered significant at the 95 percent the Conduct does not persuade the level District is although this inadmissible might affect the models failure probative States v See Cook Rockwell Int’l Corp 580 F Supp 2d 1071 1105 D Colo 2006 holding that Northern United the For the Tenth Circuit nor any other court has adopted a rule barring admission of any study that was not Dr Murphy testified to be reliable the standard that a models Murphy errors is only one Rep See id errors does plausible way significant at the at 366 14 20 confidence Finally as explained of controlling for correlations Another approach 83 Dr firms See id 82 83 Thus 95 percent would be Leamer has the Court concludes that to between include already Dr by employees included Leamers for the purposes of class certification Dr Leamer variables to one such failure not provide a sufficient basis to conclude that the Conduct methodology level results need not necessarily be statistically Dep 76 78 82 83 the commonalities across a statistically to cluster Regression does 15 27 15 28 The Court does however variables besides note that Dr Leamers revenue should have been included report is slightly to control ambiguous as for correlations to whether any across employees 42 Case No 11 CV 02509 LHK ORDER GRANTING IN PART DENYING IN PART MOTION FOR CLASS CERTIFICATION Case5 11 cv 02509 LHK 1 summary the In 2 Compensation 3 that there 4 necessarily have 5 persuaded that 6 generalized was a rigid harm 10 11 California to prove is structure to provide adequate support to all or nearly all Conduct Page43 Regression provides 53 of Analyses and Factors for or confirmation of his theory some of such that an impact to an impact Leamers employees would Defendants employees The Court is however a methodology plausible for showing class wide damages Damages to disputing whether parties dispute fail to the Class as well as estimating In addition 8 9 wage 3 7 charts resulted in Dr Dr Leamers Common Court finds that Movement Filed04 05 13 Document382 whether Plaintiffs can show impact on a class wide basis the Plaintiffs can show damages on a class wide basis and whether the damages using common evidence a precludes finding that the predominance inability requirement met Plaintiffs 12 Dr Leamer contend that can calculate damages to the Class in the aggregate and Court of 13 14 District Mot that this is sufficient for the purposes of class certification 48 CD see In re Cardizem Antitrust Litig 200 FR D 297 23 at citing Leamer E D Mich 324 2001 Rep 135 collecting District 15 cases to support this proposition Moreover Plaintiffs contend that the Ninth Circuit has held that States 16 damage the need for individualized alone cannot defeat certification calculations v Yokoyama Northern United the For 17 18 19 Midland Nat Leamer has admitted 25 Recently 22 23 24 25 show stage to damages as at trial any liability Comcast case 569 model 27 28 See Leamer Reply Rep why find is to find another improve 2013 84 the a to WL them on plaintiffs a class No Oppn at at the class certification wide basis but at the alleged anticompetitive 5 majority op variable the class certification consistent with its effect of the violation Because the Comcast the standard employeryear averages not track the To Conduct Regression and the extent obviate Justice Scalia the need for clustering 11 CV 02509 LHK IN enough better and to there are other variables that in his next report ORDER GRANTING IN PART DENYING errors the well 43 Case Dr basis individual damages case must be that rather than clustering indicating appropriate explanatory to include on need not be exact plaintiffs 1222646 model does the accuracy of the encouraged c alculations that supporting US route 26 damages on an the burden are capable of measurement particularly with respect Corp Defendants argue that 23 2324 7 398 21 399 11 Supreme Court addressed the that at 9th Cir 2010 cannot estimate that his regressions for the majority stated writing stage Co 594 F3d 1087 1094 Dep Leamer citing 20 21 Ins Life PART MOTION FOR CLASS CERTIFICATION may Dr Leamer is Case5 11 cv 02509 LHK 1 plaintiffs 2 failed to satisfy 3 for the dissent 4 certifying a class action 5 Breyer 6 to certification 7 basis 8 certification 9 methodology Rule for proving 23 b3 predominance under Federal damages that recognition Indeed 23 Dr b3 model 11 conduct terms of a percentage of 12 agreements were 13 Regression cannot estimate 14 Conduct Regression does provide 15 Defendants employees on 16 California to create a The model allows 17 of 18 for in common the estimated for each effect in that wage new 23 and Breyer b3 to Id 9 of Ginsburg and require as a prerequisite do calculations on a class wide not preclude class Id when during the periods Rep Leamer writing ground on the standard to Class members of Defendants suppression had plaintiffs evidence and a regression approach cost Defendant impact injury be measurable damages well nigh universal is 10 breaks no a class wide of 53 of Justices Ginsburg should not be read the decision that individual Leamer concludes for quantifying requirement opinion attributable to Page44 not tied to their theory Rule of Civil Procedure In particular under Rule Here damages was emphasized that the majority JJ dissenting Id s Filed04 05 13 Document382 14148 can be used challenged anti solicitation While the Conduct Court of District damages on an a individual method basis see Leamer of estimating Dep at 23 23 24 7 the undercompensation the aggregate to District a year byyear and defendant bydefendant Id basis 145 Fig 22 States the effectiveness of the agreements to vary over time and among different kinds Northern United the For workers Id members 19 of the alternative Plaintiffs method 20 their 21 Conduct Regression 22 providing an estimate 23 have theory of satisfied their 25 also demonstrates a Technical of calculating Class Id damages the Court finds that Plaintiffs of damages burden Having undertaken to each proposed for the purpose of Rule Conclusion model discussed Class 23 in regard a plausible Therefore consistent with to method antitrust claim antitrust 28 capacity of Plaintiffs evidence and proposed methodology damages burden for predominance on the Court finds that Plaintiffs the first and third elements of Plaintiffs Section and damage However the Court has concerns about the to prove impact to the All 44 No for the Court finds that Plaintiffs the issue of analysis of Plaintiffs evidence 27 Case Dr Leamers Regarding Predominance a rigorous violation above b3 on have their class wide damages by Dr Leamer is have established 26 satisfied that estimates 147 Fig 24 as set forth In addition for the reasons liability 4 24 Dr Leamer 146 11 CV 02509 LHK ORDER GRANTING IN PART DENYING IN PART MOTION FOR CLASS CERTIFICATION Employee 1 Case5 11 cv 02509 LHK 1 Class or the Technical 2 to show 3 to some employees would have 4 concerned 5 of people 6 Kohen 7 true 8 if 9 that Defendants maintained who v injured class definition may be However 11 hearing 12 evidence will be able to 13 over individual so broad that it too the Court believes motion this who persons it is broad and Cir 2009 7th it persons show may be demonstrate to is also large by the who numbers See stating that while is it conduct defendants could not have been that has occurred able to offer further proof to demonstrate class wide impact wages the class should not be certified that with the benefit of the discovery Plaintiffs The Court unlawful conduct allegedly have not been injured within 53 so broadly as to include defined 672 677 sweeps of that a suppression of structures or nearly all Class members all conduct is the defendants on compensation Co 571 F3d Inv Management Pacific by rigid Page45 about whether the evidence will be able were not necessarily harmed by Defendants that a class will often include the such affected most concerned is proposed classes that Plaintiffs 10 California The Court Class Filed04 05 13 Document382 why common since the how common issues predominate Court of 14 B 15 District Rule ones See Part IV supra Superiority District 23 b3 a also tests whether class action is superior States 16 the fair and 17 23 18 a 19 individually 20 any litigation 21 desirabilityof concentrating 22 difficulties 23 of the R Civ P 23b3 Fed Northern United the For other available methods for 92 adjudication efficient controversy to b3 superior 24 25 26 the Court must consider method in concerning an common 28 of Rule state antitrust b3 is Flat the management c lass treatment case where TFT LCD questions 23 that common Panel is by issues Plaintiffs 2 the actions by or against of a class action the class forum and No of liability 267 and impact predominate FR D in an antitrust at action 314 IN 3 the F3d at Mot for the proposition 1190 at 23 that the superiority prerequisite contend that Class members individual 11 CV 02509 LHK ORDER GRANTING IN PART DENYING of 4 the Zinser 253 45 Case in and nature extent is definition superior to thousands of individual Antitrust Litig are found to predominate satisfied commenced member interest of each class of the claims in the particular the litigation in 1 the or defense of separate the controversy already whether a class action factors in evaluating the plaintiffs claims likely to be encountered citing In re 27 non exclusive controlling the prosecution Plaintiffs claims of adjudicating four Under Rule PART MOTION FOR CLASS CERTIFICATION damages even if Case5 11 cv 02509 LHK 1 after mandatory trebling 2 noting that in 3 but a class action 4 are insufficiently would than hundreds or thousands of individual 6 proof 7 their 8 same evidence whether 9 10 11 structure it or did not it involves class action F3d to litigate treatment the 1192 12 253 13 determine violate 15 addition Defendants argue that 16 defense against at 53 Id litigation According will also be the litigating not trial same redress and the Class as a substantial at the 23 24 issues each Class individually means that superior method of adjudication Oppn have presented Plaintiffs and whole Mot separate efficient suppressed artificially here will focus on these questions numerous and litigation with nearly identical issues either their conspiracy employee or to Defendants 314 315 at more manageable establish his or her right to recover to not the is Any a single Defendants contend that 14 California actions Either defendants colluded or they did member would have individual of are likely to be too small to justify c lass treatment 5 compensation Page46 offer those with small claims the opportunity for meaningful further contend that Plaintiffs large to warrant damages cases individual antitrust Filed04 05 13 Document382 no at 25 viable citing Zinser means to Court of District antitrust impact or damages class wide Lumping the Rules Enabling Act Id citing 28 US C all 2072 employees claims b and together Dukes 131 S Ct at would 2561 In District would it violate their due process every available right to assert States each Class member Oppn at 25 citing Lindsey v Normet US 56 66 405 Northern United the For 17 1972 As a 18 The Court 19 members interests weigh 20 nature 21 litigation 22 methods of 23 of finds that for both the All Defendants in of Plaintiffs claims result class treatment in alleged favor of having Employee Class and this case overarching conspiracy litigated The Court is of the controversy also inclined 24 finding class treatment 25 finding that Plaintiffs 26 the Court declines superior to have failed to rule now on to other methods to satisfy Rule F3d regarding of adjudication 23 Class Class as a class action that class treatment See Zinser 253 find that questions the Technical In addition the b3 at is superior to other manageability weigh in favor of However s predominance in light of the Courts requirement at Plaintiffs ability to satisfy the superiority requirement 28 46 No 11 CV 02509 LHK ORDER GRANTING IN PART DENYING IN the 1190 92 27 Case Id and the desirabilityof concentrating one forum weigh heavily in favor of finding adjudication would be unmanageable PART MOTION FOR CLASS CERTIFICATION this time Case5 11 cv 02509 LHK 1 Filed04 05 13 Document382 Page47 of 53 LEAVE TO AMEND IV For the reasons stated herein the Court does not find that 2 predominance requirement of Rule 23 b3 Plaintiffs for the purpose of the All have satisfied the Employee Class or the 3 Technical Class Nevertheless the Court is keenly aware that Defendants did not produce 4 amounts of significant discovery make key or witnesses available for depositions until after the 5 hearing on Section VI Plaintiffs 6 Motion A Defendants for Class Certification See Tr at 80 125 Moreover as discussed Opposition to Class Certification relied heavily on declarations in from 7 Defendants current employees some of whom were and whose documents not timely disclosed 8 were not produced Since the Class Certification hearing to Plaintiffs have conducted Plaintiffs 9 approximately of Defendants depositions fifty high ranking employees Defendants including 10 CEOs and Human heads of Resources See ECFNos 320 327 3336 360 365 379 In addition 11 during this time Defendants have provided California Court also of Plaintiffs with over ten thousand documents Id see 12 ECF No 371 The Court believes that some of the recently produced may discovery affect 13 Plaintiffs ability to the predominance satisfy requirement for one or both of their proposed 14 District District Classes Therefore while the Court DENIES Plaintiffs Motion for Class Certification the Court 15 States leave amend affords Plaintiffs to V CLASS COUNSEL 16 Northern United the 17 In addition For whether Plaintiffs proposed Classes should be to deciding certified pursuant to 18 Rule 23 Plaintiffs Motion for Class Certification requests whether named that the Court determine 19 should be appointed as Class representatives and whether the Court should appoint Plaintiffs 20 Interim 21 CoLead Committee Counsel as CoLead as Class Counsel Class Counsel and interim members of the Executive See Notice of Mot at 22 CONFIRMS The Court hereby as final 2 ECF No 187 the appointment of Lieff Cabraser Heimann 23 Bernstein 24 LLP and the Joseph Saveri In addition the Court GRANTS Law Firm as CoLead Plaintiffs request to Counsel See appoint ECF No 147 as Class Counsel the 25 firms that have served on the Executive Committee Berger P A and Montague 26 Eisenhofer 27 PA The Court Notice of declines Mot at 2 to appoint Plaintiffs as Class representatives at this time 28 47 Case No Grant 11 CV 02509 LHK ORDER GRANTING IN PART DENYING IN PART MOTION FOR CLASS CERTIFICATION law Case5 11 cv 02509 LHK 1 VI Filed04 05 13 Document382 Page48 53 of SUPPLEMENTAL MOTIONS AND EVIDENTIARY OBJECTIONS A Defendants Discovery Obligations 2 Dr Murphys that the Court exclude request Plaintiffs deny Defendants report and expert 3 Opposition because employee declarations for five of the eleven that Defendants submitted in 4 opposition to witnesses files Defendants either refused class certification to produce documents from the 5 or did not disclose the witnesses fashion or did so in an untimely identities 6 impairing Plaintiffs whether evidence exists that to explore ability may contradict the witnesses 7 declarations Reply at 39 8 The disputed witness declarations include 1 Steven from the declarations Burmeister 9 Apple 2 Mason Decl Ex 16 Brown 3 Danny Decl Ex 19 Intuit Brown Stubblefield 10 McKell 4 Michelle Decl Ex 17 Intel Brown Maupin Lucasfilm Brown Decl Ex 22 and 11 5 Rosemary California Adobe Brown Decl Ex 24 Arriada Keiper 12 Court under Federal appropriate of Rule of Civil Procedure The Ninth Circuit gives District under Rule sanctions 37 c 15 1 Bollow v Northern the c1 Reserve Bank of v Inc Deckers 259 SF 650 F2d latitude to the district courts discretion v SAP AG 264 FRD 541 F3d 1101 1106 1093 1102 ND Cal 544 Cir 2001 9th 9th Cir 1981 issue to see also amended The 17 whether decision For Fed USA Oracle quoting Yeti by Molly Ltd 16 wide particularly 2009 States United is 13 14 District 37 argue that exclusion Plaintiffs to a penalize party for dilatory conduct during discovery proceedings is 18 committed to the sound discretion of the trial court In determining the appropriateness 19 discovery sanctions a court should consider the following factors 20 expeditious resolution of litigation 2 the courts 1T need to manage he publics docket its of interest 3 in the risk of 21 prejudice to the 4 defendants the public policy favoring disposition of cases on their merits 22 and 5 sanctions Wendt the availability of less drastic v Inc 125 Host Intl F3d 806 814 9th 23 Cir 1997 Wanderer citing v 910 Johnston F2d 652 656 9th Cir1990 24 Plaintiffs contend that Ms Arraida Keipers declaration should be excluded because she 25 did not appear in Adobes initial Rule 26 a disclosures and appeared in its supplemental 26 disclosures only after Plaintiffs moved for class certification Reply at 40 Furthermore Ms 27 ArraidaKeipers documents have not been produced Id Plaintiffs neither deposed 28 48 Case No 11 CV 02509 LHK ORDER GRANTING IN PART DENYING IN PART MOTION FOR CLASS CERTIFICATION Ms Arraida Case5 11 cv 02509 LHK 1 Keiper nor received 2 Defendants have not shown that 3 disclosures 4 is 5 prejudice 6 Plaintiffs request 7 her documents to Ms Morriss Defendants 9 Intuit and failure Ms Arraida is ArriadaKeipers concerned timely disclose to Defendants failure of 11 especially Ms ArraidaKeiper 12 drastic sanctions and given 13 either 14 still have 15 do so within 7 days 16 either 17 have leave policy Mr After favoring Keipers Thus Keipers testimony Thus declaration 26 a Rule in their Ms Arraida any significant the Court GRANTS declaration caused to the documents of Steven by Plaintiffs Stubblefield the Vice President on of cases that the Court is granting leave Resources at Burmeister the Senior Director in Wendt merits the availability of less their to virtue of Human of the five factor test articulated considering disposition 53 of there does not appear to be about the prejudice to provide Compensation at Apple Inc the public contend Page49 Motion for Class Certification Plaintiffs to identify failure as Defendants Ms strike to 10 California their Defendants in excluding Similarly the Court 8 prior to filing harmless error Furthermore to the extent constituted redundant of Filed04 05 13 Document382 amend the Court declines to exclude Court of District Mr Stubblefields not provided Mr or However Burmeisters declaration with Plaintiffs Mr Burmeisters to the extent documents Defendants that Defendants are ORDERED to District of this Order Likewise if have not yet had the opportunity Plaintiffs to depose States Mr Burmeister or Mr on Stubblefield the substance of their declarations shall Plaintiffs Northern United the For 18 do so to The Court does 19 Declaration 20 Ex 22 21 Corporation Maupin of Michelle or the Declaration of Brown Decl 22 B 23 Defendants Motions Ex 17 to Strike move to strike for Class Certification for failing 25 Phamrs Inc 26 Strike at 27 basis ECF No 247 1 US 579 Plaintiffs the Senior Compensation and Plaintiffs request the expert to 1993 38 40 the of Compensation meet report of the standards to strike either the at Lucasfilm Benefits Dr Leamer required in support by Daubert v Merrell Rules of Evidence sought report of exclude the expert The Court DENIES both motions to strike IN PART MOTION FOR CLASS CERTIFICATION Motion Dow See Dr Murphy on 11 CV 02509 LHK ORDER GRANTING IN PART DENYING Intel DENIED of Plaintiffs 49 No at FRE 702 28 Case is and Rule 702 of the Federal to Brown Decl Specialist to strike these declarations Pursuant to Daubert and have likewise at Manager Danny McKelly 24 509 have set forth good cause not find that Plaintiffs Mot the to same Case5 11 cv 02509 LHK When 1 2 considering by gatekeeper testimony offered pursuant expert making Filed04 05 13 Document382 Page50 v Cal State Univ Hayward 299 F3d 1053 reliable Elsayed Mukhtar 4 Kumho 5 testimony 6 will help the trier of fact to understand the evidence or to determine 7 testimony is 8 principles and 9 facts of the Co v is Carmichael 526 1 if admissible the experts and 4 11 California examination contrary evidence Cook F3d 12 558 564 3 data Daubert 509 technical testimony 1063 US 9th a fact in the principles evidence admissible knowledge 2 the of reliable and methods by be attacked is to is Expert issue the testimony is the product a Cir 2002 see 597 at or other specialized has reliably applied Shaky but to the cross v and attention to the burden of proof not exclusion Primiano 9th Cir 2010 move to Defendants 1999 scientific the expert R Evid 702 case Fed 10 598 US 137 150 based on sufficient facts or methods the trial court acts as determination of whether the experts a preliminary 3 Tire 702 to Rule 53 of citing Dr Leamers strike Daubert 509 US 594 at 596 testimony for three reasons First Defendants Court of Dr criticize 14 market facts 15 F3d 1073 1080 n4 16 District 13 Leamer Corp 17 the district 18 testimony Id 19 Primiano 598 20 strike 21 Common 22 4 9 16 and 18 23 statistical 24 methodologically flawed See know for failing to Mot Strike to at 4 the citing messy facts of the case and Champagne Metals ignor ing the basic v KenMax Metals Inc 458 District 10th Cir 2006 As the Federal Circuit stated in i4i Ltd P’ship v Microsoft States 598 F3d 831 Fed Cir 2010 US 562 cert granted Northern United the For 25 Dr attacked role under Daubert courts 856l at F3d Leamers Daubert 509 citing report because his judge the district US Conduct at 594 While evidence cross A2d 564 Primiano 598 27 the Court in understanding 28 Accordingly the Court 596 Second of some is No Dr Leamers Motion at expert IN not Mot of to his to Strike at Dr Leamers be proof report to be helpful issue in this antitrust to Strike 11 CV 02509 LHK ORDER GRANTING IN PART DENYING move of the type to 50 Case is finder fact Defendants and attention to the burden of the evidence and determining the facts Defendants a not Charts are unreliable Rather this evidence In addition the Court finds DENIES it the Court does not find this evidence is so as to warrant exclusion 26 2010 Regression is methodologically flawed and examination contrary evidence at a gatekeeper the Court has concerns about the probativeness see supra Part III F3d is S Ct 647 of facts underlying an experts the correctness Analyses and Compensation Movement Factors by Under Daubert 564 at to evaluate 131 PART MOTION FOR CLASS CERTIFICATION case to Case5 11 cv 02509 LHK 1 contend that Plaintiffs Dr Murphys Murphy 3 did not 4 at 5 two employee declarations 6 Chris Galy The fact that these two declarations 7 does not necessarily 8 In re Wells 9 scrutinizing declarations Plaintiffs Dr Murphys the fact that criticize Rep at See Murphy make all 11 relationships 12 is 13 Accordingly 14 inadmissible glaring reliability n35 20 are is citing from in their declarations FSupp 2d 527 Litigation Reply and Decl of Jeff Vijungco who work individuals agreements and based simply on untested Decl Dr because compensation affect market hypothesis of the informationcontained Fargo Home Mortg Overtime Pay of 53 of for his claim that the anti solicitation meaningfully reduce the supply of information or 10 California support or empirical Page51 report should be rejected as unscientific 2 10 has no theoretical Filed04 05 13 Document382 for Defendants closely from Defendants employees rather than excluding them entirely in concerns caused by Rather than excluding also the type of evidence to be arising from ongoing possible pressure Dr Murphys by attacked report on light employment this basis the Court finds that this evidence contrary Cf untrustworthy 1060 1061 at of Primiano 598 F3d at 564 Court of District the Court pursuant DENIES Plaintiffs request to Daubert and Rule to strike Dr Murphys expert report as 702 District 15 C 16 Plaintiffs 17 Defendants employees 18 26 Additional Evidentiary Plaintiffs Objections to Dr Murphys Report States Dr also seek to exclude Murphys report because he relies on interviews with Northern United the For that have a2 B 19 ii of the Federal 20 that contains 21 Civil Procedure 22 Rule 23 motion 24 26 a2b the facts or data considered 37 c 1 e the party is not allowed contend that at Dr by must ii states that an expert the witness if a party that provides at a hearing or at a trial unless Plaintiffs in violation of Rule Rules of Evidence Rule of Procedure Federal 26 a or never been adequately disclosed in fails forming Murphys was justified on December 25 admitted that he 26 handpicked declarants 27 from 28 123 5 120 23 12320 312 5 15 284 5 20 294 15 25 295 22 296 23 gathered Dr Murphys at No Rule of on 38 citing Murphy Dep at IN by a harmless 2 2012 Dr Murphy he conducted with Defendants and 9616 97 5 9821 101 3 119 14 In fact the declarations 11 CV 02509 LHK ORDER GRANTING IN PART DENYING Federal report as required or is 51 Case written information that was omitted from the declarations which included report Reply in interviews a to supply evidence substantially deposition and relied on information his opinions to provide information to use that information the failure provide PART MOTION FOR CLASS CERTIFICATION Case5 11 cv 02509 LHK 1 were not given to 2 unable to 3 Dr Murphy until Defendants dispute 4 report relied on notes from the interviews 5 this issue at the Class Certification hearing 6 notes 7 may 8 request so he didnt taken have to strike D 9 Tr Dr own to Murphys on report to drafting When the expert specifically asked about Mr Murphy didnt that Mr Hinman Court takes take any at his word Plaintiffs DENIED Supplement 12 Defendants seek to supplement 13 misleading information that they contend Plaintiffs to Civil Local pursuant Motion a Joint Administrative filed 14 California Record was nor did he rely on any notes that anybody else this basis is 11 the on Murphy 38 the report drafting 53 Joint Administrative Motion for Leave to Supplement the Record 9 2013 Defendants January rely at of and Dr contributed Mr Hinman stated 128 17 129 2 The at Defendants On 10 have any of his when Reply who or anyone Page52 his report filed of the interviews Dr Murphy that he right before to the omitted details testify Filed04 05 13 Document382 Rules 7 11 and 73d the record in order to address and See for Leave to ECF No 263 correct incomplete and Court of District filed their Reply on December Plaintiffs 10 2012 submitted in first See their Reply Id at 2 ECF No 247 District 15 73 d1 Pursuant to Civil Local Rule if new evidence has been submitted in the reply States may 16 the opposing 17 Evidence which may 18 may 19 rule as 20 Rules page limits Accordingly 21 Supplement 22 VII party file within 7 days after the reply filed and serve an Objection to Reply is Northern United the For not include it was further argument filed the 5 pages not exceed close Record the one month to is on of text stating its objections motion after Defendants filed new which their reply Joint Administrative and exceeded Motion this the Civil Local for Leave to DENIED CONCLUSION 23 For the reasons set forth above 24 Motion 25 Strike 26 report and certain employee 27 Administrative 28 the Court GRANTS amend The in part and DENIES DENIES to Class Certification for Class Certification with leave and GRANTS in part and Motion DENIES declarations for Leave to to in Court part Plaintiffs request Finally the Court No in part Plaintiffs Defendants Motion to strike Defendants DENIES Defendants to expert Joint Supplement the Record in Support of Defendants Opposition 52 Case evidence motion failed to comply with Defendants Plaintiffs to the 11 CV 02509 LHK ORDER GRANTING IN PART DENYING IN PART MOTION FOR CLASS CERTIFICATION Case5 11 cv 02509 LHK 1 IT IS Document382 Filed04 05 13 Page53 of SO ORDERED 2 3 Dated April 4 2013 LUCY H KOH United 4 States District Judge 5 6 7 8 9 10 11 California 12 Court of 13 14 District District 15 States 16 Northern United the For 17 18 19 20 21 22 23 24 25 26 27 28 53 Case No 11 CV 02509 LHK ORDER GRANTING IN PART DENYING IN PART MOTION FOR CLASS CERTIFICATION 53

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