Adobe, Apple, Google, Intel, Intuit, Pixar and Lucasfilm: The Case Over Who Recruiters Could Call

In the tech companies no cold call antitrust case, Adobe, Apple, Google and Intel agreed to a $415 million private settlement over alleged restrictions on recruiting each other’s employees. The allegations describe work a recruiter would recognize: an employer put off limits, an instruction passed down from executives, and an investigation when someone approached the wrong company’s employee. The government alleged that the companies never told workers about the agreements restricting their opportunities.

The Department of Justice’s civil complaint filed in September 2010 named six employers: Adobe, Apple, Google, Intel, Intuit and Pixar. The private employee case also included Lucasfilm. The court’s September 2015 approval order records separate settlements involving those seven employers.

Cold Calling Reached the Employees Who Had Not Applied

Cold calling meant approaching another company’s employee directly about a job when that person had not applied. In the government’s complaint, the term covered oral, written, telephone or electronic contact. The restraint reached the first approach, before an interview or competing offer could follow.

That mattered in a business competing for specialized computer engineers and scientists. The complaint described employers competing through salaries, benefits and career opportunities. Even companies receiving enormous numbers of applications still approached other firms’ employees because those people had particular skills and might not respond to ordinary recruiting.

The government alleged that the agreements removed a significant form of competition for that talent. According to the complaint, workers lost access to information about their value elsewhere and opportunities for better jobs. The alleged harm began before a worker had a rejected application or a withdrawn offer to point to. A recruiting call that never comes cannot tell an engineer what another company would pay.

How the Recruiting Restrictions Reached HR

The Department of Justice’s complaint alleged five agreements arranged and enforced by senior executives. They reached recruiters through company lists, hiring manuals and direct instructions. The complaint said none was limited by geography, job function, product group or time.

Apple and Google

According to the complaint, Apple and Google agreed no later than 2006 to stop cold calling each other’s employees. Apple placed Google on its internal “Do Not Call List.” Google’s hiring manual put Apple on its “Do Not Cold Call” list.

The complaint described executives policing the arrangement themselves: when Apple complained about Google’s recruiting, Google investigated internally and reported its findings back to Apple. In that account, an effort to attract talent became something to investigate and explain to the employer whose staff it had approached.

Apple and Adobe

The government alleged that Apple and Adobe reached their agreement no later than May 2005. According to the complaint, Apple put Adobe on its no-call list, while Adobe placed Apple on a list of “Companies that are off limits” and instructed recruiters accordingly.

The complaint alleged that the companies decided between themselves to put every employee off limits, without telling the workers or obtaining their agreement.

Apple and Pixar

The complaint alleged that Apple and Pixar reached their agreement no later than April 2007. It described Apple adding Pixar to its no-call list and Pixar telling human resources staff to document their compliance:

The alleged instruction had a revealing purpose: a paper trail to show that Pixar had refrained from approaching another employer’s people. A record of how an applicant arrived could help show whether the recruiter had honored the agreement.

Google and Intel

Google and Intel allegedly agreed no later than September 2007 to stop cold calling each other’s employees. The complaint described Google putting Intel in the hiring manual among companies covered by special agreements and its no-cold-call list, and Intel instructing its human resources staff about the agreement.

Google and Intuit

The alleged agreement between Google and Intuit had a different direction. The government alleged that in June 2007 the companies agreed that Google would not cold call any Intuit employee. The complaint said Google then included Intuit in its hiring manual’s no-cold-call list.

The Department of Justice expressly distinguished this arrangement from the others: it restricted Google’s approaches to Intuit employees, while the other agreements covered employees at both participating firms. Describing every agreement as a mutual hiring ban loses what the recruiters were actually told.

Bilateral No Cold Call Agreement Versus Absolute No Hire

A bilateral no cold call agreement restricts the employer’s approach to a candidate. An absolute no hire restriction reaches the hire itself. The tech-company complaint challenged agreements to suppress direct recruiting. Its definition of cold calling focused on employees who had not applied for an opening.

That distinction explains why the recruiting records matter. The alleged restriction operated before a candidate chose to seek the job. The government said it interfered with competition over compensation and access to opportunities, even though the challenged conduct was framed around solicitation.

The proposed judgment addressed agreements to refrain from soliciting, cold calling, recruiting or otherwise competing for employees, including requests and pressure to stop competing.

The government alleged that these company-wide restrictions were unnecessary to the companies’ collaborations. A shared project supplied no explanation for placing an entire company’s workforce off limits.

What the Government Sought to Change

The Department of Justice sought to stop the agreements and prevent similar restraints. Its proposed judgment would run for five years from court approval unless extended.

The proposal required accessible employee notice of covered collaboration and service agreements. That addressed a central feature of the complaint: the companies allegedly kept the arrangements from the people whose opportunities they restricted. The proposed remedy reached both the instructions inside HR and the information kept from the workforce.

The Private Settlement Resolved Employee Claims

The federal court in Northern California approved the private settlement with Adobe, Apple, Google and Intel on September 2, 2015. Its order separately recorded $20 million already secured from Intuit, Lucasfilm and Pixar. The order counted 64,466 class members.

The approved agreement replaced a $324.5 million proposal from the same four employers that the court had rejected.

The approved allocation connected employee shares to base salary received during the alleged conspiracy period. The court explained that the employers used different combinations of salary, bonuses and equity, but their base salary structures supplied a consistent measure for distributing the fund.

What an Insider Can Add to the Recruiting Records

An insider can connect an instruction in a hiring manual to the people who agreed on it and the decisions that followed. The government complaint described that chain: executive communications, company lists, instructions to HR, complaints about recruiting and internal investigations into those complaints.

The private approval order shows the other side of the evidence. With expert assistance, the employee class’s team analyzed over 15 gigabytes of employment-related compensation and recruiting data and studied the employers’ compensation systems. The instruction shows what recruiting was restricted. The employment data helps examine how workers were affected.

A recruiter may know why a company appeared on the list, who explained the restriction and whose complaint caused a candidate contact to stop. We work with that knowledge alongside the communications and recruiting records.

The Knorr-Bremse and Wabtec case extends the recruiting comparison to candidate refusals and permission to hire, beyond the cold-call restrictions here.

What the Settlement Means for a Whistleblower

The employee settlements resolved private compensation claims. Our whistleblower experts work with you to identify the case your recruiting records and inside knowledge support.

False claims for government money can support a different kind of case. A whistleblower case under the False Claims Act can pay 15% to 30% of what the government recovers.

You Know Why the Recruiter Stopped Calling

If a technical recruiter was told not to call a rival’s employee, our whistleblower experts can examine who set the restriction and whose complaint enforced it.