In re: High-Tech Employee Antitrust Litigation

Filing 65

AMENDED COMPLAINT Consolidated against Adobe Systems Inc., Apple Inc., Google Inc., Intel Corp., Intuit Inc., Lucasfilm Ltd., Pixar. Filed bySiddharth Hariharan. (Saveri, Joseph) (Filed on 9/13/2011)

1
2
3
4
5
6
7

Joseph R. Saveri (State Bar No. 130064)
Eric B. Fastiff (State Bar No. 182260)
Brendan P. Glackin (State Bar No. 199643)
Dean M. Harvey (State Bar No. 250298)
Anne B. Shaver (State Bar No. 255928)
Katherine M. Lehe (State Bar No. 273472)
LIEFF, CABRASER, HEIMANN & BERNSTEIN, LLP
275 Battery Street, 29th Floor
San Francisco, CA 94111-3339
Telephone: [phone]
Facsimile: [phone]
Interim Lead Counsel for Plaintiffs and the Proposed
Class

8
[Additional counsel listed on signature page]
9
10

UNITED STATES DISTRICT COURT

11

NORTHERN DISTRICT OF CALIFORNIA

12

SAN JOSE DIVISION

13
14

Master Docket No. 11-CV-2509-LHK

15

IN RE: HIGH-TECH EMPLOYEE
ANTITRUST LITIGATION

16

THIS DOCUMENT RELATES TO:

17

ALL ACTIONS

CONSOLIDATED AMENDED
COMPLAINT

18
19
20
21
22
23
24
25
26
27
28
936003.1

CONSOLIDATED AMENDED COMPLAINT
MASTER DOCKET NO. 11-CV-2509-LHK

1

TABLE OF CONTENTS

2

Page

3

I.

SUMMARY OF THE ACTION ............................................................................. 1

4

II.

JURISDICTION AND VENUE ............................................................................. 2

5

III.

CHOICE OF LAW.................................................................................................. 2

6

IV.

THE PARTIES........................................................................................................ 3

7

A.

Plaintiffs ...................................................................................................... 3

8

B.

Defendants .................................................................................................. 4

9

V.

CLASS ACTION ALLEGATIONS ....................................................................... 5

10

VI.

FACTUAL ALLEGATIONS ................................................................................. 7

11

A.

Trade And Commerce ................................................................................. 7

12

B.

Market For High Technology Employees................................................... 7

13

C.

Defendants’ Conspiracy To Fix The Compensation Of Their
Employees At Artificially Low Levels ..................................................... 10

14
2.

The Conspiracy Began With Secret and Express
Agreements Between Pixar And Lucasfilm.................................. 10

3.

Apple Enters Into A Similar Express Agreement With
Adobe ............................................................................................ 12

4.

Apple Enters Into an Express Agreement with Google To
Suppress Employee Compensation And Eliminate
Competition................................................................................... 13

5.

Apple Enters Into Another Express Agreement with Pixar .......... 14

6.

Steve Jobs Attempts To Expand the Conspiracy to Include
Palm Inc. ....................................................................................... 15

22

7.

Google Enters Into An Express Agreement With Intel................. 16

23

8.

Google and Intuit Enter Into Another Express Agreement........... 17

15
16
17
18
19
20
21

24

D.

Effects Of Defendants’ Conspiracy On Plaintiffs And The Class ............ 18

25

E.

The Investigation By The Antitrust Division Of The United States
Department Of Justice And Subsequent Admissions By Defendants....... 19

26
FIRST CLAIM FOR RELIEF....................................................................................................... 21
27
SECOND CLAIM FOR RELIEF ................................................................................................. 22
28
936003.1

-i-

CONSOLIDATED AMENDED COMPLAINT
MASTER DOCKET NO. 11-CV-2509-LHK

1

TABLE OF CONTENTS
(continued)

2

Page

3

THIRD CLAIM FOR RELIEF ..................................................................................................... 23

4

FOURTH CLAIM FOR RELIEF ................................................................................................. 24

5

PRAYER FOR RELIEF................................................................................................................ 26

6

JURY DEMAND .......................................................................................................................... 27

7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
936003.1

-ii-

CONSOLIDATED AMENDED COMPLAINT
MASTER DOCKET NO. 11-CV-2509-LHK

1

Plaintiffs Michael Devine, Mark Fichtner, Siddharth Hariharan, Brandon Marshall,

2

and Daniel Stover, individually and on behalf of a class of all those similarly situated (the

3

“Class”), complain against defendants Adobe Systems Inc., Apple Inc., Google Inc., Intel Corp.,

4

Intuit Inc., Lucasfilm Ltd., Pixar, and DOES 1-200 (collectively, “Defendants”), and allege as

5

follows:

6

I.

7

SUMMARY OF THE ACTION
1.

This class action challenges a conspiracy among Defendants to fix and

8

suppress the compensation of their employees. Without the knowledge or consent of their

9

employees, Defendants’ senior executives entered into an interconnected web of express

10

agreements to eliminate competition among them for skilled labor. This conspiracy included: (1)

11

agreements not to recruit each other’s employees; (2) agreements to notify each other when

12

making an offer to another’s employee; and (3) agreements that, when offering a position to

13

another company’s employee, neither company would counteroffer above the initial offer.

14

2.

The intended and actual effect of these agreements was to fix and suppress

15

employee compensation, and to impose unlawful restrictions on employee mobility. Defendants’

16

conspiracy and agreements restrained trade and are per se unlawful under federal and California

17

law. Plaintiffs seek injunctive relief and damages for violations of: Section 1 of the Sherman Act,

18

15 U.S.C. § 1; the Cartwright Act, California Business and Professions Code §§ 16720, et seq.;

19

California Business and Professions Code § 16600; and California Business and Professions Code

20

§§ 17200, et seq.

21

3.

In 2009 through 2010, the Antitrust Division of the United States

22

Department of Justice (the “DOJ”) investigated Defendants’ misconduct. The DOJ found that

23

Defendants’ agreements violated the Sherman Act per se and “are facially anticompetitive

24

because they eliminated a significant form of competition to attract high tech employees, and,

25

overall, substantially diminished competition to the detriment of the affected employees who

26

were likely deprived of competitively important information and access to better job

27

opportunities.” The DOJ concluded that Defendants’ agreements “disrupted the normal price-

28

setting mechanisms that apply in the labor setting.”
936003.1

-1-

CONSOLIDATED AMENDED COMPLAINT
MASTER DOCKET NO. 11-CV-2509-LHK

1

4.

The DOJ confirmed that it will not seek to compensate employees who

2

were injured by Defendants’ agreements. Without this class action, Plaintiffs and the Class will

3

not receive compensation for their injuries, and Defendants will continue to retain the benefits of

4

their unlawful collusion.

5

II.

6

JURISDICTION AND VENUE
5.

Plaintiffs bring this action to recover damages and obtain injunctive relief,

7

including treble damages, costs of suit, and reasonable attorneys’ fees arising from Defendants

8

violations of: Section 1 of the Sherman Act, 15 U.S.C. § 1; the Cartwright Act, California

9

Business and Professions Code §§ 16720, et seq.; California Business and Professions Code §

10

16600; and California Business and Professions Code §§ 17200, et seq.

11
12

6.

The Court has subject matter jurisdiction pursuant to Sections 4 and 16 of

the Clayton Act (15 U.S.C. §§ 15 and 26) and 28 U.S.C. §§ 1331 and 1337.

13

7.

Venue is proper in this judicial district pursuant to Section 12 of the

14

Clayton Act (15 U.S.C. § 22) and 28 U.S.C. § 1391(b), (c), and (d) because a substantial part of

15

the events giving rise to Plaintiffs’ claims occurred in this district, a substantial portion of the

16

affected interstate trade and commerce was carried out in this district, and one or more of the

17

defendants reside in this district.

18

8.

Defendants are subject to the jurisdiction of this Court by virtue of their

19

nationwide contacts and other activities, as well as their contacts with the State of California.

20

III.

21

CHOICE OF LAW
9.

California law applies to the claims of Plaintiffs and all Class members.

22

Application of California law is constitutional, and California has a strong interest in deterring

23

unlawful business practices of resident corporations and compensating those harmed by activities

24

occurring in and emanating from California.

25

10.

California is the state in which Defendants negotiated, entered into,

26

implemented, monitored, and enforced the conspiracy and associated agreements. These illicit

27

activities were centered within, and for the most part occurred within, the County of Santa Clara.

28
936003.1

-2-

CONSOLIDATED AMENDED COMPLAINT
MASTER DOCKET NO. 11-CV-2509-LHK

1

11.

Defendants’ actively concealed their participation in the conspiracy, and

2

actively concealed the existence of their unlawful agreements, in California. These active

3

concealment efforts were centered within the County of Santa Clara.

4

12.

California is the State in which Plaintiffs’ and Class members’ relationship

5

with the Defendants is centered. More specifically, Santa Clara is the County in which Plaintiffs

6

and Class members’ relationship with Defendants is centered. At least a majority of class

7

members reside in California. At least 98% of Class members were employed by Defendants

8

who maintained (and continue to maintain) their principal places of business in Santa Clara.

9

13.

Plaintiffs and Class members were injured by conduct occurring in, and

10

emanating from, California. The overwhelming majority of the conduct causing the injuries

11

suffered by Plaintiffs and Class members occurred within the County of Santa Clara.

12

14.

For these reasons, among others, California has significant contacts, and a

13

significant aggregation of contacts, creating state interests, with all parties and the acts alleged

14

herein.

15
16

15.
IV.

17

THE PARTIES
A.

18

California’s substantial interests far exceed those of any other state.

Plaintiffs
16.

Plaintiff Michael Devine is a citizen of the State of Washington. From

19

approximately October of 2006 through July 7, 2008, Mr. Devine was a citizen of the State of

20

Washington and worked in the state of Washington as a software engineer for Adobe Systems

21

Inc. Mr. Devine was injured in his business or property by reason of the violations alleged

22

herein.

23

17.

Plaintiff Mark Fichtner is a citizen of the State of Arizona. From

24

approximately May of 2008 through May of 2011, Mr. Fichtner was a citizen of the State of

25

Arizona and worked in the State of Arizona as a software engineer for Intel Corp. Mr. Fichtner

26

was injured in his business or property by reason of the violations alleged herein.

27
28

18.

Plaintiff Siddharth Hariharan is a citizen of the State of California. From

January 8, 2007 through August 15, 2008, Mr. Hariharan was a citizen of the State of California
936003.1

-3-

CONSOLIDATED AMENDED COMPLAINT
MASTER DOCKET NO. 11-CV-2509-LHK

1

and worked in California as a software engineer for Lucasfilm. Mr. Hariharan was injured in his

2

business or property by reason of the violations alleged herein.

3

19.

Plaintiff Brandon Marshall is a citizen of the State of California and resides

4

in the County of Santa Clara. From approximately July of 2006 through December of 2006, Mr.

5

Marshall was a citizen of the State of California, resided in the County of Santa Clara, and

6

worked in the County of Santa Clara as a software engineer for Adobe Systems Inc. Mr. Marshall

7

was injured in his business or property by reason of the violations alleged herein.

8
9

20.

Plaintiff Daniel Stover is a citizen of the State of Washington. From July

of 2006 through December of 2010, Mr. Stover was a citizen of the State of California and

10

worked in the County of Santa Clara as a software engineer for Intuit Inc. Mr. Stover was injured

11

in his business or property by reason of the violations alleged herein.

12

B.

13
14

21.

Defendant Adobe Systems Inc. (“Adobe”) is a Delaware corporation with

its principal place of business located at 345 Park Avenue, San Jose, California 95110.

15
16

Defendants

22.

Defendant Apple Inc. (“Apple”) is a California corporation with its

principal place of business located at 1 Infinite Loop, Cupertino, California 95014.

17

23.

Defendant Google Inc. (“Google”) is a Delaware corporation with its

18

principal place of business located at 1600 Amphitheatre Parkway, Mountain View, California

19

94043.

20
21

24.

place of business located at 2200 Mission College Boulevard, Santa Clara, California 95054.

22
23

25.

26.

Defendant Lucasfilm Ltd. (“Lucasfilm”) is a California corporation with its

principal place of business located at 1110 Gorgas Ave., in San Francisco, California 94129.

26
27

Defendant Intuit Inc. (“Intuit”) is a Delaware corporation with its principal

place of business located at 2632 Marine Way, Mountain View, California 94043.

24
25

Defendant Intel Corp. (“Intel”) is a Delaware corporation with its principal

27.

Defendant Pixar is a California corporation with its principal place of

business located at 1200 Park Avenue, Emeryville, California 94608.

28
936003.1

-4-

CONSOLIDATED AMENDED COMPLAINT
MASTER DOCKET NO. 11-CV-2509-LHK

1

28.

Plaintiffs allege on information and belief that DOES 1-50, inclusive, were

2

co-conspirators with other Defendants in the violations alleged in this Complaint and performed

3

acts and made statements in furtherance thereof. DOES 1-50 are corporations, companies,

4

partnerships, or other business entities that maintain their principal places of business in

5

California. Plaintiffs are presently unaware of the true names and identities of those defendants

6

sued herein as DOES 1-50. Plaintiffs will amend this Complaint to allege the true names of the

7

DOE defendants when they are able to ascertain them.

8
9

29.

Plaintiffs allege on information and belief that DOES 51-200, inclusive,

were co-conspirators with other Defendants in the violations alleged in this Complaint and

10

performed acts and made statements in furtherance thereof. DOES 51-200 are residents of the

11

State of California and are corporate officers, members of the boards of directors, or senior

12

executives of Adobe, Apple, Google, Intel, Intuit, Lucasfilm, Pixar, and DOES 1-50. Plaintiffs

13

are presently unaware of the true names and identities of those defendants sued herein as DOES

14

51-200. Plaintiffs will amend this Complaint to allege the true names of the DOE defendants

15

when they are able to ascertain them.

16

V.

17

CLASS ACTION ALLEGATIONS
30.

Plaintiffs bring this action on behalf of themselves and all others similarly

18

situated (the “Class”) pursuant to Federal Rules of Civil Procedure 23(a), 23(b)(2), and 23(b)(3).

19

The Class is defined as follows:

20

All natural persons employed by Defendants in the United States on
a salaried basis during the period from January 1, 2005 through
January 1, 2010 (the “Class Period”). Excluded from the Class are:
retail employees; corporate officers, members of the boards of
directors, and senior executives of Defendants who entered into the
illicit agreements alleged herein; and any and all judges and
justices, and chambers’ staff, assigned to hear or adjudicate any
aspect of this litigation.

21
22
23
24
25

31.

Plaintiffs do not, as yet, know the exact size of the Class because such

26

information is in the exclusive control of Defendants. Based upon the nature of the trade and

27

commerce involved, Plaintiffs believe that there are at least tens of thousands of Class members,

28
936003.1

-5-

CONSOLIDATED AMENDED COMPLAINT
MASTER DOCKET NO. 11-CV-2509-LHK

1

and that Class members are geographically dispersed throughout California and the United States.

2

Joinder of all members of the Class, therefore, is not practicable.

3
4

32.
limited to:

5
6

a.

b.

c.

whether Defendants’ agreements are void as a matter of law under

California Business and Professions Code § 16600;

11
12

whether Defendants’ conspiracy and associated agreements, or any

one of them, constitute a per se violation of the Sherman Act or Cartwright Act;

9
10

whether the conduct of Defendants violated the Sherman Act or

Cartwright Act;

7
8

The questions of law or fact common to the Class include but are not

d.

whether the conduct of Defendants violated California Business and

Professions Code §§ 17200, et seq.;

13

e.

whether Defendants fraudulently concealed their conduct;

14

f.

whether Defendants’ conspiracy and associated agreements

15

restrained trade, commerce, or competition for skilled labor among Defendants;

16
17

g.

whether Plaintiffs and the Class suffered antitrust injury or were

threatened with injury;

18

h.

the difference between the total compensation Plaintiffs and the

19

Class received from Defendants, and the total compensation Plaintiffs and the Class would have

20

received from Defendants in the absence of the illegal acts, contracts, combinations, and

21

conspiracy alleged herein;

22
23

i.
Class.

24
25

the type and measure of damages suffered by Plaintiffs and the

33.

These and other questions of law and fact are common to the Class, and

predominate over any questions affecting only individual Class members.

26

34.

Plaintiffs’ claims are typical of the claims of the Class.

27

35.

Plaintiffs will fairly and adequately represent the interests of the Class and

28

have no conflict with the interests of the Class.
936003.1

-6-

CONSOLIDATED AMENDED COMPLAINT
MASTER DOCKET NO. 11-CV-2509-LHK

1
2

36.

litigation and class action litigation to represent themselves and the Class.

3
4

Plaintiffs have retained competent counsel experienced in antitrust

37.

Defendants have acted on grounds generally applicable to the Class,

thereby making final injunctive relief appropriate with respect to the Class as a whole.

5

38.

This class action is superior to the alternatives, if any, for the fair and

6

efficient adjudication of this controversy. Prosecution as a class action will eliminate the

7

possibility of repetitive litigation. There will be no material difficulty in the management of this

8

action as a class action. By contrast, prosecution of separate actions by individual Class members

9

would create the risk of inconsistent or varying adjudications, establishing incompatible standards

10

of conduct for Defendants.

11

VI.

12

FACTUAL ALLEGATIONS
A.

13
14

39.

During the Class Period, Defendants employed Class members in

California and throughout the United States, including this judicial district.

15
16

Trade And Commerce

40.

Defendants’ conduct substantially affected interstate commerce throughout

the United States and caused antitrust injury throughout the United States.

17

B.

18

Market For High Technology Employees
41.

In a properly functioning and lawfully competitive labor market, each

19

Defendant would compete for employees by soliciting current employees of one or more other

20

Defendants. Defendants refer to this recruiting method as “cold calling.” Cold calling includes

21

communicating directly in any manner (including orally, in writing, telephonically, or

22

electronically) with another firm’s employee who has not otherwise applied for a job opening.

23
24

42.

Cold calling is a particularly effective recruiting method because current

employees of other companies are often unresponsive to other recruiting strategies.

25

43.

Defendants and other high technology companies classify potential

26

employees into two categories: first, those who are currently employed by rival firms and not

27

actively seeking to change employers; and second, those who are actively looking for

28

employment offers (either because they are unemployed, or because they are unsatisfied with
936003.1

-7-

CONSOLIDATED AMENDED COMPLAINT
MASTER DOCKET NO. 11-CV-2509-LHK

1

their current employer). Defendants and other high technology companies value potential

2

employees of the first category significantly higher than potential employees of the second

3

category, because current satisfied employees tend to be more qualified, harder working, and

4

more stable than those who are actively looking for employment.

5

44.

In addition, a company searching for a new hire is eager to save costs and

6

avoid risks by poaching that employee from a rival company. Through poaching, a company is

7

able to take advantage of the efforts its rival has expended in soliciting, interviewing, and training

8

skilled labor, while simultaneously inflicting a cost on the rival by removing an employee on

9

whom the rival may depend.

10

45.

For these reasons and others, cold calling is a key competitive tool

11

companies use to recruit employees, particularly high technology employees with advanced skills

12

and abilities.

13

46.

The practice of cold calling has a significant impact on employee

14

compensation in a variety of ways. First, without receiving cold calls from rival companies,

15

current employees lack information regarding potential pay packages and lack leverage over their

16

employers in negotiating pay increases. When a current employee receives a cold call from a

17

rival company with an offer that exceeds her current compensation, the current employee may

18

either accept that offer and move from one employer to another, or use the offer to negotiate

19

increased compensation from her current employer. In either case, the recipient of the cold call

20

has an opportunity to use competition among potential employers to increase her compensation

21

and mobility.

22

47.

Second, once an employee receives information regarding potential

23

compensation from rival employers through a cold call, that employee is likely to inform other

24

employees of her current employer. These other employees often use the information themselves

25

to negotiate pay increases or move from one employer to another, despite the fact that they

26

themselves did not receive a cold call.

27
28

48.

Third, cold calling a rival’s employees provides information to the cold

caller regarding its rival’s compensation practices. Increased information and transparency
936003.1

-8-

CONSOLIDATED AMENDED COMPLAINT
MASTER DOCKET NO. 11-CV-2509-LHK

1

regarding compensation levels tends to increase compensation across all current employees,

2

because there is pressure to match or exceed the highest compensation package offered by rivals

3

in order to remain competitive.

4

49.

Fourth, cold calling is a significant factor responsible for losing employees

5

to rivals. When a company expects that its employees will be cold called by rivals with

6

employment offers, the company will preemptively increase the compensation of its employees in

7

order to reduce the risk that its rivals will be able to poach relatively undercompensated

8

employees.

9

50.

The compensation effects of cold calling are not limited to the particular

10

individuals who receive cold calls, or to the particular individuals who would have received cold

11

calls but for the anticompetitive agreements alleged herein. Instead, the effects of cold calling

12

(and the effects of eliminating cold calling, pursuant to agreement) commonly impact all salaried

13

employees of the participating companies.

14
15

51.

levels to achieve certain goals, including:

16
17

Defendants carefully monitor and manage their internal compensation

a.

maintaining approximate compensation parity among employees

within the same employment categories (for example, among junior software engineers);

18

b.

maintaining certain compensation relationships among employees

19

across different employment categories (for example, among junior software engineers relative to

20

senior software engineers);

21

c.

maintaining high employee morale and productivity;

22

d.

retaining employees; and

23

e.

attracting new and talented employees.

24

52.

To accomplish these objectives, Defendants set baseline compensation

25

levels for different employee categories that apply to all employees within those categories.

26

Defendants also compare baseline compensation levels across different employee categories.

27

Defendants update baseline compensation levels regularly.

28
936003.1

-9-

CONSOLIDATED AMENDED COMPLAINT
MASTER DOCKET NO. 11-CV-2509-LHK

1

53.

While Defendants sometimes engage in negotiations regarding

2

compensation levels with individual employees, these negotiations occur from a starting point of

3

the pre-existing and pre-determined baseline compensation level. The eventual compensation any

4

particular employee receives is either entirely determined by the baseline level, or is profoundly

5

influenced by it. In either case, suppression of baseline compensation will result in suppression

6

of total compensation.

7

54.

Thus, under competitive and lawful conditions, Defendants would use cold

8

calling as one of their most important tools for recruiting and retaining skilled labor, and the use

9

of cold calling among Defendants commonly impacts and increases total compensation and

10

mobility of all Defendants’ employees.

11

C.

12
13

Defendants’ Conspiracy To Fix The Compensation Of Their Employees At
Artificially Low Levels
55.

Defendants’ conspiracy consisted of an interconnected web of express

14

agreements, each with the active involvement and participation of a company under the control of

15

Steven P. Jobs (“Steve Jobs”) and/or a company that shared at least one member of Apple’s board

16

of directors. Defendants entered into the express agreements and entered into the overarching

17

conspiracy with knowledge of the other Defendants’ participation, and with the intent of

18

accomplishing the conspiracy’s objective: to reduce employee compensation and mobility

19

through eliminating competition for skilled labor.

20

2.

The Conspiracy Began With Secret and Express Agreements Between
Pixar And Lucasfilm

56.

The conspiracy began with an agreement between senior executives of

21
22
23

Pixar and Lucasfilm to eliminate competition between them for skilled labor, with the intent and

24

effect of suppressing the compensation and mobility of their employees.

25

57.

Pixar and Lucasfilm have a shared history. In 1986, Steve Jobs purchased

26

Lucasfilm’s computer graphics division, established it as an independent company, and called it

27

“Pixar.” Thereafter and until 2006, Steve Jobs remained C.E.O. of Pixar.

28
936003.1

- 10 -

CONSOLIDATED AMENDED COMPLAINT
MASTER DOCKET NO. 11-CV-2509-LHK

1

58.

Before Steve Jobs’s departure as C.E.O. of Pixar and beginning no later

2

than January 2005, senior executives of Pixar and Lucasfilm entered into at least three agreements

3

to eliminate competition between them for skilled labor.

4

59.

First, each agreed not to cold call each other’s employees.

5

60.

Second, each agreed to notify the other company when making an offer to

6

an employee of the other company, if that employee applied for a job notwithstanding the absence

7

of cold calling.

8

61.

Third, each agreed that if either made an offer to such an employee of the

9

other company, neither company would counteroffer above the initial offer. This third agreement

10

was created with the intent and effect of eliminating “bidding wars,” whereby an employee could

11

use multiple rounds of bidding between Pixar and Lucasfilm to increase her total compensation.

12

62.

Pixar and Lucasfilm reached these express agreements through direct and

13

explicit communications among senior executives. Pixar drafted the written terms of the

14

agreements in Emeryville, California and sent those terms to Lucasfilm. Pixar and Lucasfilm

15

then provided the written terms to management and certain senior employees with the relevant

16

hiring or recruiting responsibilities.

17

63.

The three agreements covered all employees of the two companies, were

18

not limited by geography, job function, product group, or time period, and were not ancillary to

19

any legitimate collaboration between Pixar and Lucasfilm.

20

64.

Senior executives of Pixar and Lucasfilm actively concealed their unlawful

21

agreements. Employees of Pixar and Lucasfilm were not aware of, and did not agree to, the terms

22

of the agreements between Pixar and Lucasfilm.

23

65.

After entering into the agreements, senior executives of both Pixar and

24

Lucasfilm monitored compliance and policed violations. For instance, in 2007, from its principal

25

place of business in Emeryville, California, Pixar twice contacted Lucasfilm regarding suspected

26

violations of their agreements. Lucasfilm responded by changing its conduct to conform to its

27

anticompetitive agreements with Pixar. The senior executives of Pixar who monitored

28
936003.1

- 11 -

CONSOLIDATED AMENDED COMPLAINT
MASTER DOCKET NO. 11-CV-2509-LHK

1

Lucasfilm’s compliance and policed Lucasfilm’s violations worked in Pixar’s principal place of

2

business in Emeryville, California.

3

66.

Until no later than May of 2005, Lucasfilm employees were harmed

4

primarily through the actions and inactions of Pixar, pursuant to Pixar’s illicit agreements with

5

Lucasfilm (agreements that were drafted in Emeryville, California).

6

67.

First, but for its agreements with Lucasfilm, Pixar would have cold called

7

Lucasfilm employees from Pixar’s principal place of business in Emeryville, California, where

8

Pixar’s management and senior employees with the relevant hiring or recruiting responsibilities

9

worked. Instead, pursuant to agreement, Pixar (in Emeryville, California) directed its

10

management and certain senior employees not to cold call Lucasfilm employees.

11

68.

Second, when Pixar (from Emeryville, California) made an offer to a

12

Lucasfilm employee, Pixar (from Emeryville, California) notified Lucasfilm of the terms of the

13

offer.

14

69.

Third, if Lucasfilm, upon receiving Pixar’s notification, decided to match

15

Pixar’s offer to retain the employees in question, Pixar (from Emeryville, California) did not raise

16

its offer beyond Pixar’s initial bid.

17

70.

Thus, until no later than May of 2005, the acts that reduced artificially the

18

compensation of Lucasfilm employees occurred primarily in Pixar’s offices in Emeryville,

19

California.

20

71.

After no later than May of 2005, and continuing until approximately

21

January 1, 2010, Lucafilm employees were also harmed by the conduct of the remaining

22

Defendants, as hereafter alleged. The conduct of the remaining Defendants occurred principally

23

in the County of Santa Clara.

24

3.

Apple Enters Into A Similar Express Agreement With Adobe

25

72.

Shortly after Pixar entered into the agreements with Lucasfilm, Apple

26

(which was then also under the control of Steve Jobs) entered into an agreement with Adobe that

27

was identical to the first agreement Pixar entered into with Lucasfilm. Apple and Adobe agreed

28
936003.1

- 12 -

CONSOLIDATED AMENDED COMPLAINT
MASTER DOCKET NO. 11-CV-2509-LHK

1

to eliminate competition between them for skilled labor, with the intent and effect of suppressing

2

the compensation and mobility of their employees.

3
4

73.

Beginning no later than May 2005, Apple and Adobe agreed not to cold

call each other’s employees.

5

74.

Senior executives of Apple and Adobe reached the agreement through

6

direct and explicit communications. These executives then actively managed and enforced the

7

agreement through further direct communications.

8
9

75.

This explicit agreement between Apple and Adobe was negotiated,

finalized, implemented, and enforced in the County of Santa Clara.

10

76.

The agreement between Apple and Adobe concerned all Apple and all

11

Adobe employees, was not limited by geography, job function, product group, or time period, and

12

was not ancillary to any legitimate collaboration between the companies.

13

77.

Senior executives of Apple and Adobe actively concealed their unlawful

14

agreement and their participation in the conspiracy. These concealment efforts occurred

15

principally in the County of Santa Clara. Employees of Apple and Adobe were not aware of, and

16

did not agree to, these restrictions.

17

78.

In complying with the agreement, Apple placed Adobe on its internal “Do

18

Not Call List,” which instructed Apple recruiters not to cold call Adobe employees. Adobe

19

included Apple on its internal list of “Companies that are off limits,” instructing its employees not

20

to cold call employees of Apple. Both of these lists were created and maintained in the County of

21

Santa Clara.

22

4.

Apple Enters Into an Express Agreement with Google To Suppress
Employee Compensation And Eliminate Competition

79.

The conspiracy expanded to include Google no later than 2006. Apple and

23
24
25

Google agreed to eliminate competition between them for skilled labor, with the intent and effect

26

of suppressing the compensation and mobility of their employees. Senior executives of Apple

27

and Google expressly agreed, through direct communications, not to cold call each other’s

28

employees. During 2006, Arthur D. Levinson sat on the boards of both Apple and Google.
936003.1

- 13 -

CONSOLIDATED AMENDED COMPLAINT
MASTER DOCKET NO. 11-CV-2509-LHK

1
2

80.

This explicit agreement between Apple and Google was negotiated,

finalized, implemented, and enforced in the County of Santa Clara.

3

81.

The agreement between Apple and Google concerned all Apple and all

4

Google employees, was not limited by geography, job function, product group, or time period,

5

and was not ancillary to any legitimate collaboration between the companies.

6

82.

Apple and Google actively concealed their agreement and their

7

participation in the conspiracy. These concealment efforts occurred principally in the County of

8

Santa Clara. Employees were not informed of and did not agree to the restrictions.

9

83.

To ensure compliance with the agreement, Apple placed Google on its

10

internal “Do Not Call List,” which instructed Apple employees not to cold call Google

11

employees. In turn, Google placed Apple on its internal “Do Not Cold Call” list, and instructed

12

relevant employees not to cold call Apple employees. Both of these lists were created and

13

maintained in the County of Santa Clara.

14

84.

Senior executives of Apple and Google monitored compliance with the

15

agreement and policed violations. In February and March 2007, Apple contacted Google to

16

complain about suspected violations of the agreement. In response, Google conducted an internal

17

investigation and reported its findings back to Apple. These enforcement activities occurred in

18

the County of Santa Clara.

19

5.

Apple Enters Into Another Express Agreement with Pixar

20

85.

Beginning no later than April 2007, Apple entered into an agreement with

21

Pixar that was identical to its earlier agreements with Adobe and Google. Apple and Pixar agreed

22

to eliminate competition between them for skilled labor, with the intent and effect of suppressing

23

the compensation and mobility of their employees. Senior executives of Apple and Pixar

24

expressly agreed, through direct communications, not to cold call each other’s employees.

25
26

86.

implemented, and enforced in the County of Santa Clara and the County of Alameda.

27
28

This explicit agreement between Apple and Pixar was negotiated, finalized,

87.

At this time, Steve Jobs continued to exert substantial control over Pixar.

On January 24, 2006, Jobs announced that he had agreed to sell Pixar to the Walt Disney
936003.1

- 14 -

CONSOLIDATED AMENDED COMPLAINT
MASTER DOCKET NO. 11-CV-2509-LHK

1

Company. After the deal closed, Jobs became the single largest shareholder of the Walt Disney

2

Company, with over 6% of the company’s stock. Jobs thereafter sat on Disney’s board of

3

directors and continued to oversee Disney’s animation businesses, including Pixar.

4

88.

The agreement between Apple and Pixar concerned all Apple and all Pixar

5

employees, was not limited by geography, job function, product group, or time period, and was

6

not ancillary to any legitimate collaboration between the companies.

7
8

89.

Apple and Pixar actively concealed their agreement and their participation

in the conspiracy. Employees were not informed of and did not agree to the restrictions.

9

90.

To ensure compliance with the agreement, Apple placed Pixar on its

10

internal “Do Not Call List,” which instructed Apple employees not to cold call Pixar employees.

11

Apple created and maintained this list in the County of Santa Clara. Pixar instructed its human

12

resource personnel to adhere to the agreement and to preserve documentary evidence establishing

13

that Pixar had not actively recruited Apple employees.

14

91.

15

agreement and policed violations.

Senior executives of Apple and Pixar monitored compliance with the

16

6.

Steve Jobs Attempts To Expand the Conspiracy to Include Palm Inc.

17

92.

In approximately August 2007, Steve Jobs contacted the CEO of Palm Inc.

18

(“Palm”), Edward T. Colligan (“Ed Colligan”), to propose that Apple and Palm agree to refrain

19

from hiring each other’s employees.

20

93.

In the several months preceding August 2007, Apple and Palm cold called

21

each other’s employees and otherwise competed for each other’s skilled labor. Apple hired

22

approximately 2% of Palm’s workforce, and Palm hired a valuable and highly talented Apple

23

executive, Jon Rubinstein, among other Apple employees. This lawful competition led to

24

increased compensation for employees of the companies and increased labor mobility and choice.

25

94.

Steve Jobs sought to end competition between Palm and Apple for skilled

26

labor. Steve Jobs communicated directly with Ed Colligan, stating that “We must do whatever

27

we can” to stop cold calling and other competitive recruiting efforts between the companies.

28
936003.1

- 15 -

CONSOLIDATED AMENDED COMPLAINT
MASTER DOCKET NO. 11-CV-2509-LHK

1

Steve Jobs attempted to intimidate Palm into agreeing to the proposal by threatening litigation,

2

and stating that Apple had patents and more money than Palm.

3

95.

Ed Colligan rebuffed Steve Jobs’ efforts, telling him: “Your proposal that

4

we agree that neither company will hire the other’s employees, regardless of the individual’s

5

desires, is not only wrong, it is likely illegal.”

6

96.

Approximately all of the relevant events and communications regarding

7

Steve Jobs’ illicit offer to Palm, and Ed Colligan’s refusal, occurred within the County of Santa

8

Clara.

9

7.

Google Enters Into An Express Agreement With Intel

10

97.

In 2007, Google CEO Eric Schmidt sat on Apple’s board of directors,

11

along with Arthur D. Levinson, who continued to sit on the boards of both Apple and Google.

12

98.

Beginning no later than September 2007, Google entered into an agreement

13

with Intel that was identical to Google’s earlier agreement with Apple, and identical to Apple’s

14

earlier agreements with Adobe and Pixar. Google and Intel agreed to eliminate competition

15

between them for skilled labor, with the intent and effect of suppressing the compensation and

16

mobility of their employees. Senior executives of Google and Intel expressly agreed, through

17

direct communications, not to cold call each other’s employees.

18
19

99.

This explicit agreement between Google and Intel was negotiated,

finalized, implemented, and enforced in the County of Santa Clara.

20

100.

The agreement between Google and Intel concerned all Google and all

21

Intel employees, was not limited by geography, job function, product group, or time period, and

22

was not ancillary to any legitimate collaboration between the companies. Google and Intel

23

actively concealed their agreement and their participation in the conspiracy. These concealment

24

efforts occurred principally in the County of Santa Clara. Employees were not informed of and

25

did not agree to the restrictions.

26

101.

To ensure compliance with the agreement, Google listed Intel on its “Do

27

Not Cold Call” list and instructed Google employees not to cold call Intel employees. Intel also

28

informed its relevant personnel about its agreement with Google, and instructed them not to cold
936003.1

- 16 -

CONSOLIDATED AMENDED COMPLAINT
MASTER DOCKET NO. 11-CV-2509-LHK

1

call Google employees. Google’s “Do Not Cold Call” list was created and maintained in the

2

County of Santa Clara.

3

102.

Senior executives of Google and Intel monitored compliance with the

4

agreement and policed violations. These enforcement activities occurred in the County of Santa

5

Clara.

6

8.

Google and Intuit Enter Into Another Express Agreement

7

103.

In June 2007, Google entered into an express agreement with Intuit that

8

was identical to Google’s earlier agreements with Intel and Apple, and identical to the earlier

9

agreements between Apple and Adobe, and between Apple and Pixar. Google CEO Eric Schmidt

10

sat on Apple’s board of directors, along with Arthur D. Levinson, who continued to sit on the

11

boards of both Apple and Google.

12

104.

Google and Intuit agreed to eliminate competition between them for skilled

13

labor, with the intent and effect of suppressing the compensation and mobility of their employees.

14

Senior executives of Google and Intuit expressly agreed, through direct communications, not to

15

cold call each other’s employees. This explicit agreement between Google and Intuit was

16

negotiated, finalized, implemented, and enforced in the County of Santa Clara.

17

105.

The agreement between Google and Intuit concerned all Google and all

18

Intuit employees, was not limited by geography, job function, product group, or time period, and

19

was not ancillary to any legitimate collaboration between the companies. Google and Intuit

20

actively concealed their agreement and their participation in the conspiracy. These concealment

21

efforts occurred principally in the County of Santa Clara. Employees were not informed of and

22

did not agree to the restrictions.

23

106.

To ensure compliance with the agreement, Google listed Intuit on its “Do

24

Not Cold Call” list and instructed Google employees not to cold call Intuit employees. Intuit also

25

informed its relevant personnel about its agreement with Google, and instructed them not to cold

26

call Google employees.

27
28
936003.1

- 17 -

CONSOLIDATED AMENDED COMPLAINT
MASTER DOCKET NO. 11-CV-2509-LHK

1

107.

Senior executives of Google and Intuit monitored compliance with the

2

agreement and policed violations. These enforcement activities occurred in the County of Santa

3

Clara.

4

D.

5

Effects Of Defendants’ Conspiracy On Plaintiffs And The Class
108.

Defendants eliminated competition for skilled labor by entering into the

6

interconnected web of agreements, and the overarching conspiracy, alleged herein. These

7

agreements are summarized graphically as follows:

8
9
10
11
12
13
14
15
16
17
18
19
20
21

Defendants entered into, implemented, and policed these agreements with the knowledge of the

22

overall conspiracy, and did so with the intent and effect of fixing the compensation of the

23

employees of participating companies at artificially low levels. For example, every agreement

24

alleged herein directly involved a company either controlled by Steve Jobs, or a company that

25

shared a member of its board of directors with Apple. As additional companies joined the

26

conspiracy, competition among participating companies for skilled labor further decreased, and

27

compensation and mobility of the employees of participating companies was further suppressed.

28

These anticompetitive effects were the purpose of the agreements, and Defendants succeeded in
936003.1

- 18 -

CONSOLIDATED AMENDED COMPLAINT
MASTER DOCKET NO. 11-CV-2509-LHK

1

lowering the compensation and mobility of their employees below what would have prevailed in

2

a lawful and properly functioning labor market.

3

109.

Defendants’ conspiracy was an ideal tool to suppress their employees’

4

compensation. Whereas agreements to fix specific and individual compensation packages would

5

be hopelessly complex and impossible to monitor, implement, and police, eliminating entire

6

categories of competition for skilled labor (that affected the compensation and mobility of all

7

employees in a common and predictable fashion) was simple to implement and easy to enforce.

8

110.

Plaintiffs and each member of the Class were harmed by each and every

9

agreement herein alleged. The elimination of competition and suppression of compensation and

10

mobility had a cumulative effect on all Class members. For example, an individual who was an

11

employee of Lucasfilm received lower compensation and faced unlawful obstacles to mobility as

12

a result of not only the illicit agreements with Pixar, but also as a result of Pixar’s agreement with

13

Apple, and so on.

14

E.

15
16

The Investigation By The Antitrust Division Of The United States
Department Of Justice And Subsequent Admissions By Defendants
111.

Beginning in approximately 2009, the Antitrust Division of the United

17

States Department of Justice (the “DOJ”) conducted an investigation into the employment

18

practices of Defendants. The DOJ issued Civil Investigative Demands to Defendants that resulted

19

in Defendants producing responsive documents to the DOJ. The DOJ also interviewed witnesses

20

to certain of the agreements alleged herein.

21

112.

After reviewing these materials, the DOJ concluded that Defendants had

22

agreed to naked restraints of trade that were per se unlawful under the antitrust laws. The DOJ

23

found that Defendants’ agreements “are facially anticompetitive because they eliminated a

24

significant form of competition to attract high tech employees, and, overall, substantially

25

diminished competition to the detriment of the affected employees who were likely deprived of

26

competitively important information and access to better job opportunities.” The DOJ further

27

found that the agreements “disrupted the normal price-setting mechanisms that apply in the labor

28

setting.”
936003.1

- 19 -

CONSOLIDATED AMENDED COMPLAINT
MASTER DOCKET NO. 11-CV-2509-LHK

1

113.

The DOJ also concluded that Defendants’ agreements “were not ancillary

2

to any legitimate collaboration” and were “much broader than reasonably necessary for the

3

formation or implementation of any collaborative effort.”

4

114.

On September 24, 2010, the DOJ filed a complaint regarding Defendants’

5

agreements against Adobe, Apple, Google, Intel, Intuit, and Pixar. On December 21, 2010, the

6

DOJ filed another complaint regarding Defendants’ agreements, this time against Lucasfilm and

7

Pixar. In both cases, the DOJ filed stipulated proposed final judgments in which Adobe, Apple,

8

Google, Intel, Intuit, Lucasfilm, and Pixar agreed that the DOJ’s complaints “state[] a claim upon

9

which relief may be granted” under federal antitrust law.

10

115.

In the stipulated proposed final judgments, Adobe, Apple, Google, Intel,

11

Intuit, Lucasfilm, and Pixar agreed to be “enjoined from attempting to enter into, maintaining or

12

enforcing any agreement with any other person or in any way refrain from, requesting that any

13

person in any way refrain from, or pressuring any person in any way to refrain from soliciting,

14

cold calling, recruiting, or otherwise competing for employees of the other person.” Defendants

15

also agreed to a variety of enforcement measures and to comply with ongoing inspection

16

procedures. The United States District Court for the District of Columbia entered the stipulated

17

proposed final judgments on March 17, 2011 and June 3, 2011.

18

116.

After the DOJ’s investigation became public in the fall of 2010,

19

Defendants acknowledged participating in the agreements the DOJ alleged in its complaints.

20

These acknowledgments included a statement on September 24, 2010 by Amy Lambert, associate

21

general counsel for Google, who stated that, for years, Google had “decided” not to “‘cold call’

22

employees at a few of our partner companies.” Lambert also said that a “number of other tech

23

companies had similar ‘no cold call’ policies—policies which the U.S. Justice Department has

24

been investigating for the past year.”

25

117.

The DOJ did not seek monetary penalties of any kind against Defendants,

26

and made no effort to compensate employees of the Defendants who were harmed by Defendants’

27

anticompetitive conduct.

28
936003.1

- 20 -

CONSOLIDATED AMENDED COMPLAINT
MASTER DOCKET NO. 11-CV-2509-LHK

1

118.

Without this class action, Plaintiffs and the Class will be unable to obtain

2

compensation for the harm they suffered, and Defendants will retain the benefits of their unlawful

3

conspiracy.

4

FIRST CLAIM FOR RELIEF
(Violations of Section 1 of the Sherman Act, 15 U.S.C. § 1)

5
6

119.

Plaintiffs, on behalf of themselves and all others similarly situated, reallege

7

and incorporate herein by reference each of the allegations contained in the preceding paragraphs

8

of this Complaint, and further allege against Defendants and each of them as follows:

9

120.

Defendants entered into and engaged in unlawful agreements in restraint of

10

the trade and commerce described above in violation of Section 1 of the Sherman Act,

11

15 U.S.C. § 1. Beginning no later than January 2005 and continuing at least through 2009,

12

Defendants engaged in continuing trusts in restraint of trade and commerce in violation of Section

13

1 of the Sherman Act.

14

121.

Defendants’ agreements have included concerted action and undertakings

15

among the Defendants with the purpose and effect of: (a) fixing the compensation of Plaintiffs

16

and the Class at artificially low levels; and (b) eliminating, to a substantial degree, competition

17

among Defendants for skilled labor.

18

122.

As a direct and proximate result of Defendants’ combinations and contracts

19

to restrain trade and eliminate competition for skilled labor, members of the Class have suffered

20

injury to their property and have been deprived of the benefits of free and fair competition on the

21

merits.

22
23

123.
among others:

24
25

a.

competition among Defendants for skilled labor has been

suppressed, restrained, and eliminated; and

26
27

The unlawful agreements among Defendants has had the following effects,

b.

Plaintiffs and class members have received lower compensation

from Defendants than they otherwise would have received in the absence of Defendants’ unlawful

28
936003.1

- 21 -

CONSOLIDATED AMENDED COMPLAINT
MASTER DOCKET NO. 11-CV-2509-LHK

1

agreements, and, as a result, have been injured in their property and have suffered damages in an

2

amount according to proof at trial.

3

124.

The acts done by each Defendant as part of, and in furtherance of, their

4

contracts, combinations or conspiracies were authorized, ordered, or done by their respective

5

officers, directors, agents, employees, or representatives while actively engaged in the

6

management of each Defendant’s affairs.

7
8

125.

Defendants’ contracts, combinations and/or conspiracies are per se

violations of Section 1 of the Sherman Act.

9

126.

Accordingly, Plaintiffs and members of the Class seek three times their

10

damages caused by Defendants’ violations of Section 1 of the Sherman Act, the costs of bringing

11

suit, reasonable attorneys’ fees, and a permanent injunction enjoining Defendants’ from ever

12

again entering into similar agreements in violation of Section 1 of the Sherman Act.

13

SECOND CLAIM FOR RELIEF
(Violations of the Cartwright Act, Cal. Bus. & Prof. Code §§ 16720, et seq.)

14
15

127.

Plaintiffs, on behalf of themselves and all others similarly situated, reallege

16

and incorporate herein by reference each of the allegations contained in the preceding paragraphs

17

of this Complaint, and further alleges against Defendants and each of them as follows:

18

128.

Defendants entered into and engaged in an unlawful trust in restraint of the

19

trade and commerce described above in violation of California Business and Professions Code

20

section 16720. Beginning no later than January 2005 and continuing at least through 2009,

21

Defendants engaged in continuing trusts in restraint of trade and commerce in violation of the

22

Cartwright Act.

23

129.

Defendants’ trusts have included concerted action and undertakings among

24

the Defendants with the purpose and effect of: (a) fixing the compensation of Plaintiffs and the

25

Class at artificially low levels; and (b) eliminating, to a substantial degree, competition among

26

Defendants for skilled labor.

27
28

130.

As a direct and proximate result of Defendants’ combinations and contracts

to restrain trade and eliminate competition for skilled labor, members of the Class have suffered
936003.1

- 22 -

CONSOLIDATED AMENDED COMPLAINT
MASTER DOCKET NO. 11-CV-2509-LHK

1

injury to their property and have been deprived of the benefits of free and fair competition on the

2

merits.

3
4

131.
others:

5
6

The unlawful trust among Defendants has had the following effects, among

a.

competition among Defendants for skilled labor has been

suppressed, restrained, and eliminated; and

7

b.

Plaintiffs and Class members have received lower compensation

8

from Defendants than they otherwise would have received in the absence of Defendants’ unlawful

9

trust, and, as a result, have been injured in their property and have suffered damages in an amount

10

according to proof at trial.

11
12

132.

Plaintiffs and members of the Class are “persons” within the meaning of

the Cartwright Act as defined in section 16702.

13

133.

The acts done by each Defendant as part of, and in furtherance of, their

14

contracts, combinations or conspiracies were authorized, ordered, or done by their respective

15

officers, directors, agents, employees, or representatives while actively engaged in the

16

management of each Defendant’s affairs.

17
18

134.

Defendants’ contracts, combinations and/or conspiracies are per se

violations of the Cartwright Act.

19

135.

Accordingly, Plaintiffs and members of the Class seek three times their

20

damages caused by Defendants’ violations of the Cartwright Act, the costs of bringing suit,

21

reasonable attorneys’ fees, and a permanent injunction enjoining Defendants’ from ever again

22

entering into similar agreements in violation of the Cartwright Act.

23

THIRD CLAIM FOR RELIEF
(Violations of Cal. Bus. & Prof. Code § 16600)

24
25

136.

Plaintiffs, on behalf of themselves and all others similarly situated, reallege

26

and incorporate herein by reference each of the allegations contained in the preceding paragraphs

27

of this Complaint, and further alleges against Defendants and each of them as follows:

28
936003.1

- 23 -

CONSOLIDATED AMENDED COMPLAINT
MASTER DOCKET NO. 11-CV-2509-LHK

1
2

137.

Defendants entered into, implemented, and enforced express agreements

that are unlawful and void under Section 16600.

3

138.

Defendants’ agreements and conspiracy have included concerted action

4

and undertakings among the Defendants with the purpose and effect of: (a) reducing open

5

competition among Defendants for skilled labor; (b) reducing employee mobility; (c) eliminating

6

opportunities for employees to pursue lawful employment of their choice; and (d) limiting

7

employee professional betterment.

8

139.

9
10

legislative policy in favor of open competition and employee mobility, and are therefore void and
unlawful.

11
12

140.

Defendants’ agreements and conspiracy were not intended to protect and

were not limited to protect any legitimate proprietary interest of Defendants.

13
14

Defendants’ agreements and conspiracy are contrary to California’s settled

141.

Defendants’ agreements and conspiracy do not fall within any statutory

exception to Section 16600.

15

142.

The acts done by each Defendant as part of, and in furtherance of, their

16

contracts, combinations or conspiracies were authorized, ordered, or done by their respective

17

officers, directors, agents, employees, or representatives while actively engaged in the

18

management of each Defendant’s affairs.

19

143.

Accordingly, Plaintiffs and members of the Class seek a judicial

20

declaration that Defendants’ agreements and conspiracy are void as a matter of law under Section

21

16600, and a permanent injunction enjoining Defendants’ from ever again entering into similar

22

agreements in violation of Section 16600.

23

FOURTH CLAIM FOR RELIEF
(Unfair Competition in Violation of Cal. Bus. & Prof. Code §§ 17200, et seq.)

24
25

144.

Plaintiffs, on behalf of themselves and all others similarly situated, reallege

26

and incorporate herein by reference each of the allegations contained in the preceding paragraphs

27

of this Complaint, and further alleges against Defendants as follows:

28
936003.1

- 24 -

CONSOLIDATED AMENDED COMPLAINT
MASTER DOCKET NO. 11-CV-2509-LHK

1

145.

Defendants’ actions to restrain trade and fix the total compensation of their

2

employees constitute unfair competition and unlawful, unfair, and fraudulent business acts and

3

practices in violation of California Business and Professional Code sections 17200, et seq.

4

146.

The conduct of Defendants in engaging in combinations with others with

5

the intent, purpose, and effect of creating and carrying out restrictions in trade and commerce;

6

eliminating competition among them for skilled labor; and fixing the compensation of their

7

employees at artificially low levels, constitute and was intended to constitute unfair competition

8

and unlawful, unfair, and fraudulent business acts and practices within the meaning of California

9

Business and Professions Code section 17200.

10
11

147.

Defendants also violated California’s Unfair Competition Law by violating

the Sherman Act, Cartwright Act, and/or by violating Section 16600.

12

148.

As a result of Defendants’ violations of Business and Professions Code

13

section 17200, Defendants have unjustly enriched themselves at the expense of Plaintiffs and the

14

Class. The unjust enrichment continues to accrue as the unlawful, unfair, and fraudulent business

15

acts and practices continue.

16

149.

To prevent their unjust enrichment, Defendants and their co-conspirators

17

should be required pursuant to Business and Professions Code sections 17203 and 17204 to

18

disgorge their illegal gains for the purpose of making full restitution to all injured class members

19

identified hereinabove. Defendants should also be permanently enjoined from continuing their

20

violations of Business and Professions Code section 17200.

21

150.

The acts and business practices, as alleged herein, constituted and

22

constitute a common, continuous, and continuing course of conduct of unfair competition by

23

means of unfair, unlawful, and/or fraudulent business acts or practices within the meaning of

24

California Business and Professions Code section 17200, et seq., including, but in no way limited

25

to, violations of the Sherman Act, Cartwright Act, and/or Section 16600.

26

151.

Defendants’ acts and business practices as described above, whether or not

27

in violation of the Sherman Act, Cartwright Act, and/or Section 16600 are otherwise unfair,

28

unconscionable, unlawful, and fraudulent.
936003.1

- 25 -

CONSOLIDATED AMENDED COMPLAINT
MASTER DOCKET NO. 11-CV-2509-LHK

1
2

152.

situated, requests the following classwide equitable relief:

3
4

Accordingly, Plaintiffs, on behalf of themselves and all others similarly

a.

that a judicial determination and declaration be made of the rights

of Plaintiffs and the Class members, and the corresponding responsibilities of Defendants;

5

b.

that Defendants be declared to be financially responsible for the

6

costs and expenses of a Court-approved notice program by mail, broadcast media, and publication

7

designed to give immediate notification to class members; and

8
9

c.

requiring disgorgement and/or imposing a constructive trust upon

Defendants’ ill-gotten gains, freezing Defendants’ assets, and/or requiring Defendants to pay

10

restitution to Plaintiffs and to all members of the Class of all funds acquired by means of any act

11

or practice declared by this Court to be an unlawful, unfair, or fraudulent.

12

PRAYER FOR RELIEF

13
14

WHEREFORE, Plaintiffs pray that this Court enter judgment on their behalf and that of
the Class by adjudging and decreeing that:

15
16

153.

This action may be maintained as a class action, with Plaintiffs as the

designated Class representatives and their counsel as Class counsel;

17

154.

Defendants have engaged in a trust, contract, combination, or conspiracy in

18

violation of Section 1 of the Sherman Act and California Business and Professions Code

19

section 16750(a), and that Plaintiffs and the members of the Class have been damaged and injured

20

in their business and property as a result of this violation;

21
22

155.

The alleged combinations and conspiracy be adjudged and decreed to be

per se violations of the Sherman Act and Cartwright Act;

23

156.

Plaintiffs and the members of the Class they represent recover threefold the

24

damages determined to have been sustained by them as a result of the conduct of Defendants,

25

complained of herein, and that judgment be entered against Defendants for the amount so

26

determined;

27
28

157.

The alleged combinations and conspiracy be adjudged void and unlawful

under Section 16600;
936003.1

- 26 -

CONSOLIDATED AMENDED COMPLAINT
MASTER DOCKET NO. 11-CV-2509-LHK

1

Eric L. Cramer
Shanon J. Carson
Sarah R. Schalman-Bergen
BERGER & MONTAGUE, P.C.
1622 Locust Street
Philadelphia, PA 19103
Telephone: [phone]
Facsimile: [phone]

2
3
4
5
6

Linda P. Nussbaum
John D. Radice
GRANT & EISENHOFER P.A.
485 Lexington Avenue, 29th Floor
New York, NY 10017
Telephone: [phone]
Facsimile: [phone]

7
8
9
10

Counsel for Plaintiffs and the Proposed Class

11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
936003.1

- 28 -

CONSOLIDATED AMENDED COMPLAINT
MASTER DOCKET NO. 11-CV-2509-LHK