Noncompete News: Justice Department: Non-solicit Agreements Among High-Tech Employers Violate Antitrust Law

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The Department of Justice's (DOJ) Antitrust Division recently filed two complaints, along with proposed settlement agreements, in D.C. federal court alleging that no-solicit agreements among high-tech employers constituted unlawful restraints on trade in the market for highly-skilled employees in the technology sector. In United States v. Adobe Systems, Inc., DOJ alleged that do-not-call agreements among Google, Apple, Adobe, Intel, Intuit and Pixar were formed and managed via communications between company executives to prohibit recruiters from contacting employees of cooperating firms to fill open positions.

In United States v. Lucasfilm, Ltd., DOJ alleged that, in addition to a do-not-call agreement, Lucasfilm and Pixar agreed to notify each other when making offers to each others' employees and to not make counteroffers to their own employees offered a position by the other company. In the Competitive Impact Statements filed in both cases, DOJ argued that such agreements reduce competition for highly-skilled employees such as engineers and digital animators, comparing the do-not-call lists for employees to the no-call lists for customers or suppliers previously found by courts to be "per se" unlawful restraints on competition.

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DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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