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In re High-Tech Employee Antitrust Litigation

United States District Court, N.D. California, San Jose Division

March 3, 2015



LUCY H. KOH, District Judge.

This matter is before the Court on Plaintiffs' motion for preliminary approval of the proposed class action settlement (the "Settlement") between individual and representative Plaintiffs Mark Fichtner, Siddharth Hariharan, Daniel Stover, and Michael Devine and the Class of individuals they represent ("Plaintiffs") and Defendants Adobe Systems Incorporated, Apple Inc., Google Inc., and Intel Corporation (collectively, the "Settling Defendants"), as set forth in the Settlement Agreement. Having considered the Motion, the Settling Parties' Settlement Agreement, the proposed form of notice to the Class, the pleadings and other papers filed in this Action, and the statements of counsel and the parties, and for good cause shown, IT IS HEREBY ORDERED as follows:

1. Unless otherwise defined herein, all terms that are capitalized herein shall have meanings ascribed to those terms in the Settlement Agreement.

2. The Court has jurisdiction over this Action (and all actions and proceedings consolidated in the Action), Plaintiffs, Class Members, Adobe, Apple, Google, and Intel, the Released Parties, and any party to any agreement that is part of or related to the Settlement Agreement.

3. To grant preliminary approval of the proposed Settlement, the Court need only find that it falls within "the range of reasonableness." Alba Conte et al., Newberg on Class Actions § 11.25, at 11-91 (4th ed. 2002). The Manual for Complex Litigation (Fourth) (2004) (" Manual ") characterizes the preliminary approval stage as an "initial evaluation" of the fairness of the proposed settlement made by the court on the basis of written submissions and informal presentation from the settling parties. Manual § 21.632. A proposed settlement may be finally approved by the trial court if it is determined to be "fundamentally fair, adequate and reasonable." Class Plaintiffs v. City of Seattle, 955 F.2d 1268, 1276 (9th Cir. 1992). While consideration of the requirements for final approval is unnecessary at this stage, all of the relevant factors weigh in favor of approving the Settlement proposed here.

4. First, the Settlement appears to be the result of arm's-length negotiations among experienced counsel. On May 22, 2014, Plaintiffs Mark Fichtner, Siddharth Hariharan, and Daniel Stover moved the Court to preliminarily approve a settlement agreement with Defendants providing for a settlement fund of $324, 500, 000. The Court denied preliminary approval on August 8, 2014 (Dkt. 974). Thereafter, the parties resumed arm's-length negotiations through Hon. Layn Phillips (Ret.), an experienced mediator, while continuing to litigate outstanding pre-trial matters. Plaintiffs filed a reply in support of their motion for application of the per se standard (Dkt. 988), and Defendants requested leave to file a supplemental opposition (Dkt. 990 & 990-1), which was granted (Dkt. 1023). Plaintiffs also filed a motion to unseal all papers associated with their motion to compel (Dkt. 991), which Defendants opposed (Dkt. 994; see also Dkt. 1029).

5. Meanwhile, on September 4, 2014, Defendants filed a Petition for a Writ of Mandamus with the United States Court of Appeals for the Ninth Circuit, seeking an order vacating the Court's denial of preliminary approval and directing the Court to preliminarily approve the $324, 500, 000 settlement. (9th Cir. Case No. 14-72545, Dkt. 1.) On September 22, 2014, the Ninth Circuit issued an order stating that Defendants' "petition for a writ of mandamus raises issues that warrant a response, " ordered Plaintiffs to file a response, set a date for Defendants' reply, and ordered that upon completion of briefing the matter shall be placed on the next available merits panel for oral argument. (9th Cir. Dkt. 2; Dkt. 993.) Plaintiffs (and Michael Devine separately) opposed Defendants' petition (9th Cir. Dkt. Nos. 4 & 6), and Defendants replied (9th Cir. Dkt. 10). Putative amici curiae Chamber of Commerce of the United States of America, California Chamber of Commerce, and economic scholars filed motions for leave to file amici curiae briefs in support of the petition (9th Cir. Dkts. 8 & 9), which the Ninth Circuit referred to the panel to be assigned to hear the merits of the petition (9th Cir. Dkt. 15). Plaintiffs (and Michael Devine separately) opposed the motions for leave to file amici curiae briefs. (9th Cir. Dkts. 13 & 16.) The Ninth Circuit scheduled oral argument on the petition for March 13, 2015. (9th Cir. Dkt. 19.) On January 30, 2015, the Settling Defendants filed an unopposed motion to dismiss the mandamus petition (9th Cir. Dkt. 23), which the Ninth Circuit granted on February 2, 2015 (9th Cir. Dkt. 24).

6. At the time of settlement, the following motions remained pending: Defendants' motion to exclude Dr. Matthew Marx's testimony; Plaintiffs' motion to exclude Defendants' experts' testimony; Plaintiffs' motion for application of the per se standard; Defendants' motions in limine; and Plaintiffs' motion to compel. In addition, Plaintiffs and Defendants have continued to engage in the exchange of extensive pretrial disclosures and conferences regarding trial exhibits, witnesses, the joint pretrial statement, the authentication of business records and potential depositions related thereto, and many other issues.

7. Second, the consideration - a total of $415 million - is substantial, particularly in light of the risk that the jury could find no liability or award no damages. When combined with the $20 million received from Plaintiffs' previous settlements with Defendants Pixar, Lucasfilm, and Intuit, the result for the Class in this litigation will total $435 million.

8. Third, the Settlement's Plan of Allocation provides a neutral and fair way to compensate Class members based on their salary and alleged injury. In re NASDAQ Mkt.-Makers Antitrust Litig., 176 F.R.D. 99, 102 (S.D.N.Y. 1997).

9. Fourth, litigation through trial would be complex and costly, which settlement avoids. In re Austrian & German Bank Holocaust Litig., 80 F.Supp.2d 164, 174 (S.D.N.Y. 2000), aff'd sub. nom. D'Amato v. Deutsche Bank, 236 F.3d 78 (2d Cir. 2001). While settlement provides the Class with a timely, certain, and meaningful cash recovery, a trial - and any subsequent appeals - is highly uncertain, and in any event would substantially delay any recovery achieved.

10. Fifth, the Settling Parties agreed to settle at a particularly advanced stage of the proceedings - after class certification and the completion of discovery and dispositive motions.

11. Accordingly, the Court finds that notice to the Class is appropriate and that the Plan of Allocation is sufficiently fair, reasonable, and adequate such that it is hereby preliminarily approved, subject to further ...

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