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Judge Koh Rejects Wage-Fixing Settlement while Pointing to Silicon Valley's Fear and Deference to Steve Jobs

Earlier this morning the Financial Times wrote a great report about Judge Koh rejecting a $325M wage-fixing settlement. The report stated that "A US judge on Friday offered a behind-the-scenes look at the force of will with which Steve Jobs once held sway over Silicon Valley, as she threw out a proposed settlement of a lawsuit against Apple and three other tech companies."


According to the Financial Times, "The class action case had been brought on behalf of more than 64,000 tech workers over alleged collusion between the Silicon Valley companies not to poach each other's staff."


Judge Lucy Koh wrote as she rejected a $324.5m settlement that "There is compelling evidence that Steve Jobs  was a, if not the, central figure in the alleged conspiracy."


According to Judge Koh, the series of secret pacts began when Mr. Jobs reached a no-poaching deal for Pixar, the animation studio he controlled, with George Lucas, head of Lucasfilm.


That became the model for agreements with other companies, with "fear of and deference to" Mr. Jobs a big reason for the willingness of others to join in the alleged conspiracy, the judge added.


Ed Colligan, chief executive of rival smartphone maker Palm, was singled out on Friday for having stood up to Mr. Jobs' bullying. He wrote to the then-CEO of Apple that a no-poaching agreement between the two companies would be "not only wrong, it is likely illegal." He also called Mr. Jobs "out of line" for threatening a patent lawsuit in response to Palm's hiring of a single Apple employee."


In the end, Judge Koh said that the amount "falls below the range of reasonableness." given what the plaintiffs could hope to achieve at trial, and that the offer should have been "at least $380m."


That would have nice to hear Judge Koh weigh in like that in the Apple vs. Samsung trial. It would have been sweet to hear Koh state that Samsung is required to pay Apple more for their blatant patent infringement because it "falls below the range of reasonableness." I guess that would have been asking too much of the judge. Too bad.


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