Shareholders Sue Apple Over Illegal Hiring Agreement
Apple is undergoing a lot of lawsuits nowadays. Although Apple recently signed truce with Samsung that made both the companies give up all the non-U.S. legal disputes, that deal is not enough to take Apple out of legal issues completely.
Apple is now being sued by one of the company’s shareholders — R Andre Klein — who has filed the case on behalf of all Apple shareholders. Apple is being accused of striking an illegal deal with other big companies, including Google, Adobe and Intel. The deal was not to hire employees from each other’s organizations.
The lawsuit claims that Apple misled its investors and damaged the value of the company by striking this deal. The defendants in the case are Tim Cook, William Campbell, Millard Drexler, Arthur Levinson, Robert Iger, Andrea Jung, Fred Anderson and the Estate of Steven Jobs.
To be specific, Apple is being accused for violating U.S. Securities and Exchange Act by striking this hiring agreement. As a result of this agreement, Apple was not allowed to hire employees from Google and other companies, which agreed on the deal, and vice versa.
“This is a shareholder derivative action seeking to remedy the wrongdoing committed by Apple’s senior directors and officers who have caused millions of dollars in damages to Apple and its shareholders. Plaintiff asserts claims under federal law for violations of Section 14(a) of the Securities Exchange Act of 1934 (the “Exchange Act”), 15 U.S.C. § 78n(a), and under state law for breach of fiduciary duty, gross mismanagement, corporate waste, and breach of the duty of honest services,” wrote PatentlyApple.
Judge Lucy Koh rejected the settlement deal that alleged companies had reached with tech workers to compensate for their losses incurred by the companies as a result of the controversial hiring agreement. Koh deemed $324 million deal to be unfair and inadequate after receiving strong evidence against former CEO of Apple — Steve Jobs (now deceased). Koh identified him as “a, if not the, central figure in the alleged conspiracy.”
This latest complaint submitted by Klein has 77 pages. He criticized Steve Jobs to be blinded for profits and notes that even widely respected businessman can knowingly strike illegal deals.
“In this case, Jobs and the other individual defendants knowingly caused Apple to enter into agreements that violated California law and US antitrust laws,” notes Klein in the complaint.