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Steve Jobs, Google CEO plotted ‘gentlemen’s agreement’ to keep wages down – report

Published time: January 25, 2014 00:36
Edited time: January 27, 2014 10:41
ARCHIVE PHOTO. Apple chief executive Steve Jobs, (left) introduces Google chief executive officer Dr. Eric Schmidt. (AFP Photo / Tony Avelar)

ARCHIVE PHOTO. Apple chief executive Steve Jobs, (left) introduces Google chief executive officer Dr. Eric Schmidt. (AFP Photo / Tony Avelar)

Two of the most powerful people in the technology world secretly and perhaps illegally coordinated business strategies in which they agreed not to poach each other’s employees, thereby keeping salaries low, according to emails unveiled in federal court.

Apple founder Steve Jobs and Google CEO Eric Schmidt apparently kept a secret pact to institute a “no-hire” policy in which each executive promised not to recruit each other’s workers. Yet the tech superstars are just two of the business leaders to be implicated in the wink-wink agreement, which reportedly included Google, Apple, Intel, Adobe, Intuit, and Pixar.

According to Pando Daily journalist Mark Ames, the scheme began in early 2005, when the need for Silicon Valley engineers was at an all-time high. The deal’s consequences became so pervasive that the US Department of Justice launched an antitrust investigation in 2010, which laid the groundwork for a class action lawsuit filed on behalf of more than 100,000 Silicon Valley employees who allege they were deprived of over $9 billion since 2000.

The US 9th Circuit Court of Appeals refused to throw out the class action suit over the objections of executives at Apple, Google, Intel, and Adobe. The emails in question were unsealed Tuesday by Judge Lucy Koh, the same judge who presided over the Samsung-Apple patent lawsuit.

Jobs, who died in 2011, seems to be the principal architect behind the illegal conspiracy. Yet Schmidt, according to an email from Google senior advisor Bill Campbell dated February 27, 2005, “got directly involved and firmly stopped all efforts to recruit anyone from Apple.”

Schmidt is also said to have told his Senior Vice President for Business Operation Shona Brown to only mention the pact “verbally, since I don’t want to create a paper trail over which we can be sued later.”

Google founder Sergey Brin was also strong-armed when he approached members of Apple’s Safari team about working for Google. Jobs, in an emailed quoted by Pando Daily, cited the “gentlemen’s agreement” when threatening Brin, stating: “If you hire a single one of these people that means war.”

Testifying in court, former Palm CEO Edward Colligan said Jobs enforced the no-poaching policy by threatening to hire away Palm employees, or worse.

Mr. Jobs also suggested that if Palm did not agree to such an arrangement, Palm could face lawsuits alleging infringement of Apple’s many patents,” Colligan said.

Colligan swore he told Jobs the scheme was “likely illegal” and that Palm Inc. – a computer hardware firm eventually obtained by HP – would not be “intimidated” by a patent battle.

If you choose the litigation route, we can respond with our own claims based on patent assets, but I don’t think litigation is the answer,” Colligan testified to telling Jobs, as quoted by Reuters.

A jury trial has been set for May 27 in San Jose, California.

Comments (32)


Gaetano Aloi 09.03.2014 00:31

Wow! we all have guns so why don't we set a national suicide day, commit suicide en mass and depopulate the country. No more people to rob, no government to fleece the people and no corporations to collude with the government on how to fleece the world. Then there is the questions on how many virgins we get to share with our un-shaved confederates.


Carlos Gomez 07.03.2014 23:20

This is one of those deals where its called "Private Free Enterprise."

Given the same set of circumstance and putting each of you in their shoes, you would've done the exact same thing!

Now the coup de grace.......did any of you stop trying to get hired by these Corp's? My gut instinct tells me no. Now if you would spend your time productively challenging this A-typical practice and developed your own creativity you too could be this kind of Employer and rich people characteristic's.


Alt Bart 07.03.2014 21:46

LOL, and this from the jerk that stole everything Apple is built on from the Xerox Palo Alto Research Center.

Juha Teuvonnen 28.01.2014 19:15

May be this agreement existed back when when google CEO was on Apple's board of directors? That is, before Android. After Android was released Jobs said: "I'm going to destroy Android, because it's a stolen product. I'm willing to go thermonuclear war on this." and "I will spend my last dying breath if I need to, and I will spend every penny of Apple's $40 billion in the bank, to right this wrong."


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