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June 3, 2009
The U.S. Justice Department is probing possible collusion in hiring by Microsoft Corp., Google Inc. and Yahoo! Inc. and several other companies, said two people familiar with the investigation.
The investigation may include a dozen technology companies, said the people, who spoke on condition of anonymity.
The Justice Department faces the difficult task of proving that there is an explicit agreement between the companies that they wouldn’t hire employees from their rivals, said David Balto, a former antitrust attorney with the Federal Trade Commission.
The investigation adds to the scrutiny of technology companies under President Barack Obama’s administration. The makeup of Google’s and Apple’s boards has already drawn the scrutiny of the U.S. Federal Trade Commission, and the Justice Department is looking into a settlement with publishers over Google’s book-scanning project.
Google, based in Mountain View, California confirmed it has been contacted by the Justice Department and is cooperating with the investigation, said spokesman Adam Kovacevich. Yahoo, based in Sunnyvale, California, is also cooperating, said company spokeswoman Kim Rubey. Microsoft spokesman Jack Evans, declined to comment.
Justice Department spokeswoman Gina Talamona declined to comment.
Technology companies often trade workers as they seek to lure the best talent, and sometimes end up in conflict. In 2005, Microsoft, the world’s largest software maker, sued after Google lured away Kai-Fu Lee to run a development center in China. The companies settled the suit.
Legal Battle
In January, Apple and International Business Machines Corp. resolved a three-month legal battle over the hiring of IBM executive Mark Papermaster as Apple’s engineering chief.
Christine Varney, the Justice Department’s antitrust chief, has promised aggressive enforcement to curb anticompetitive behavior by companies. After serving as a member of the FTC, Varney lobbied former President Bill Clinton’s administration on behalf of Netscape Communications Corp. to bring the government’s landmark 1998 antitrust lawsuit against Microsoft.
Microsoft rose 33 cents to $21.73 at 5:19 p.m. New York time in Nasdaq Stock Market trading. Google gained $3.25 to $431.65. Yahoo fell 32 cents to $16.30.
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