eBay hit with antitrust lawsuits for alleged no-poach agreement with Intuit

3:27 PM, Nov 17, 2012   |    comments
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SAN JOSE (BCN) - The U.S. and California justice departments filed simultaneous antitrust lawsuits against eBay Inc. in federal court in San Jose today, alleging that the online shopping company illegally agreed with Intuit Inc. that the firms would not recruit each other's employees.

The pact between San Jose-based eBay and Mountain View-based Intuit, a financial software company, was in effect between 2006 and 2009, according to the lawsuits.

The lawsuits allege the agreement distorted competition and harmed employees.

"eBay's agreement with Intuit hurt employees by lowering the salaries and benefits they might have received and deprived them of better job opportunities at the other company," said Acting Assistant U.S. Attorney General and Antitrust Division head Joseph Wayland.

"If California is going to continue to be the high-tech capital of the world, we can't allow anticompetitive conduct that prevents talent from going where it's put to its highest use," said California Attorney General Kamala Harris.

Former eBay CEO Meg Whitman and Intuit founder Steve Cook "were intimately involved in forming, monitoring and enforcing this anticompetitive agreement," the federal lawsuit alleges.

Both lawsuits claim eBay's actions violated the U.S. Sherman Antitrust Act.

The state lawsuit filed by lawyers from Harris's office also alleges violations of state antitrust law and California's Unfair Competition Law. It seeks a court order declaring the alleged agreement illegal, an injunction barring any similar pacts in the future, and civil financial penalties.

The U.S. Justice Department said Intuit was not sued today because it was previously named along with five other high-tech companies, including Apple Inc. and Google Inc. in a lawsuit filed by the department in federal court in San Jose in 2010.

Intuit and the other five companies have reached a settlement with the DOJ in which they promised not to enter into such agreements, the department said.

The federal and state agencies said they worked closely together on the two lawsuits.

eBay spokeswoman Lara Wyss said, "eBay Inc. strongly believes that the Department of Justice and California attorney general are wrong and are using the wrong standard in these matters.

"The DOJ and state attorney general are taking an overly aggressive interpretation in their enforcement of antitrust law in this area. eBay will vigorously defend itself," she said.

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