Photographer: Kiyoshi Ota/Bloomberg

Disney Agrees to Pay $100 Million to End No-Poaching Lawsuit

  • Company is final defendant in class action against studios
  • Workers alleged ‘gentlemen’s agreement’ to not recruit

Walt Disney Co. agreed to pay $100 million to resolve claims it colluded with other animation studios to not hire one another’s workers in California, where allegations of no-poaching pacts have plagued technology companies for the better part of a decade.

Disney and three of its units are the last remaining defendants in a class-action lawsuit alleging the studios conspired to suppress wages through a “gentleman’s agreement” to not recruit each other’s workers. Attorneys for Disney and employees submitted a court filing Tuesday seeking approval of their settlement.

Comcast Corp.’s DreamWorks Animation SKG previously agreed to a $50 million settlement, while two Sony Pictures units and Blue Sky Studios reached deals totaling $19 million.

Apple Inc., Google, Intel Corp. and Adobe Systems Inc. paid $415 million in 2015 to resolve their part in a similar case that was brought against Silicon Valley technology companies that had been investigated for collusion by the U.S. Justice Department.

Orly Lobel, a law professor at the University of San Diego, predicted Disney’s settlement will win approval because it satisfies requirements the agreement is fair, reasonable and adequate.

Last Holdout

“Given that this was the last holdout, there are already proxies of what should be the lump sum and it seems within the range," Lobel said. A $100 million settlement for one large company is proportional to the $415 million agreed to by several technology giants in the previous case, and the much smaller earlier settlements, she said.

A Disney spokesperson didn’t immediately respond to a call after regular business hours seeking comment on the agreement.

The studios case is Nitsch v. DreamWorks Animation SKG Inc., 14-cv-04062, U.S. District Court, Northern District of California (San Jose).

— With assistance by Christopher Palmeri

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