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“No-Poaching” Lawsuits Come to Hollywood

Posted in Covenants Not to Compete in California, Hiring a Competitor’s Employees, Protecting Trade Secrets and Other Business Information, Unfair Competition

Readers of this blog are familiar with our coverage of the various cases involving high tech firms in Silicon Valley such as Google and Adobe involving alleged “no poaching” agreements that they would not solicit each other’s employees for possible employment.  Both the U.S. Government and plaintiff class action attorneys have alleged that such conduct violates anti-trust laws and/or constitutes unfair competition under California law for violating the provisions of Business and Professions Code section 16600 regarding the prohibitions on non-compete agreements.

Earlier this week, a similar class action lawsuit was filed against various entertainment companies, including DreamWorks Animation SKG and the Walt Disney Co., accusing these companies of agreeing not to “poach” each other’s animation and visual effect artists.  The suit also alleges that the defendants agreed to fix wages and salary ranges for these employees.  The plaintiffs in this new action will likely follow the “roadmap” set forth in the Silicon Valley litigation.  It remains to be seen what other industries may be targeted with similar lawsuits in the near future.

For more details concerning this latest lawsuit, please see “DreamWorks Animation, Disney sued over alleged no-poaching scheme,” Los Angeles Times, September 8, 2014.