Did Apple CEO Steve Jobs ask Palm’s Colligan to collude?

“Former Palm Inc. Chief Executive Officer Ed Colligan rejected a proposal from Apple Inc.’s Steve Jobs to refrain from hiring each other’s employees two years ago, calling it wrong and ‘likely illegal,’ according to their communications,” Connie “The Vulture” Guglielmo reports for Bloomberg.

MacDailyNews Note: You remember Ed:

We’ve learned and struggled for a few years here figuring out how to make a decent phone. PC guys are not going to just figure this out. They’re not going to just walk in.Palm CEO Ed Colligan, commenting on then-rumored Apple iPhone, Nov. 16, 2006

Guglielmo continues, “Colligan, who stepped down as CEO in June, discussed the matter with Jobs in August 2007, as the mobile-phone war heated up, according to the communications. Apple had introduced the iPhone two months earlier, just as Palm hired a former Apple executive, Jon Rubinstein, to develop new smart phones. Jobs, Apple’s CEO, told Colligan he was concerned that Rubinstein was recruiting Apple employees. ‘We must do whatever we can to stop this,’ Jobs said in the communications.”

“The U.S. Justice Department is investigating possible collusion in hiring among technology companies, a person familiar with the probe said in June,” Guglielmo reports. “Derick Mains, a spokesman for Palm, said the company hasn’t been contacted by the Justice Department. Bloomberg News reviewed the communications between Jobs and Colligan.”

“The exact details of what Jobs proposed to Colligan aren’t known; Jobs didn’t mention a proposal in the communications reviewed by Bloomberg. Jobs said Apple had patents and more money than Palm if the companies ended up in a legal fight, according to the communications,” Guglielmo reports.

“Rubinstein was head of Apple’s iPod unit before he left the company in 2006 and had worked with Jobs for more than 15 years,” Guglielmo reports. “Palm hired him as executive chairman in 2007 and he succeeded Colligan, 48, as CEO this year.”

“‘Your proposal that we agree that neither company will hire the other’s employees, regardless of the individual’s desires, is not only wrong, it is likely illegal,’ Colligan said to Jobs, 54, according to the communications,” Guglielmo reports. “Colligan said he thought about Jobs’s proposal and considered offering hiring concessions, before deciding against it, according to the exchanges.”

Guglielmo reports, “Employees are entitled to seek work wherever they want, including at rival firms, said Donald Russell, an antitrust lawyer who worked at the Justice Department for more than two decades before going into private practice in Washington.”

Much more in the full article here.

MacDailyNews Take: We’ve heard talk that Rubinstein’s departure from Apple wasn’t all sunshine and roses. In fact, sunshine and roses were not present at all. Despite the public pronouncements, according to rumors we’ve heard, Rubinstein’s departure from Apple was, uh, let’s say, not-so-amicable. Worse than Fred Anderson’s exit even.

Let’s cut right to the chase: Why is Bloomberg News privy to Palm’s communications and who gave them to Bloomberg News and for what purpose?

Is this the best Palm can do? Is this all they have left? If so, we might be hearing Palm’s death rattle on this lovely Thursday morning.

In our opinion, Palm is headed by vindictive, derivative, scorned little men. Outfits headed by such people usually do not fare very well. Neither do people who get into pissing matches with Steve Jobs.

25 Comments

  1. Apple and its vendors in Colorado Springs area did in fact have an agreement not to hire each others employes in the early 1990s when Apple had a computer factory in the area.
    I know this because I worked for one of the vendors and Apple personnel would not talk to me unless I first quit my job with the vendor. When the vendor announced by way of press release that they were going out of business Apple contacted me the very same day to set up an interview for a job in their engineering department. I know of several other cases where similar occurrences happened with agreements between Apple and other companies not to hire each others employes, although people might not like it, this is common practice in the business world and is not illegal. The author of this article is therefore full of crap and is guilty of try to create a tempest in a teapot and should have his journalistic nuggets cut off for lack of research.

  2. If employees have contracts with their employer, then trying to recruit employees can be inducing people to break a legal contract, which often leads to nasty and expensive civil lawsuits. To avoid those lawsuits, competitors will agree not to recruit people to break their contractual agreements. That’s common sense and not illegal and it can keep protracted and disruptive legal battles to a minimum. I’m sure this was not about lower level employees, but involves key people who are likely under some kind of contract with Apple.

  3. Thing one: no one outside of us Apple watchers will ever even be aware of this. People I know who aren’t tech watchers never hear about things like Jobs’ liver transplant, companies suing Apple over supposed patent or copyright infringements, and so on.

    Thing two: MDN is committing a logical error by just pointing out possible motives for why this info might be passed around right now and then dismissing it. Having a motive to say something does not make that thing untrue. In other words, Palm may, in fact, be “headed by vindictive, derivative, scorned little men,” but Steve Jobs may also be culpable of collusion. To what extent that collusion is illegal would have to be decided by authorities who know the law.

  4. I just hope Palm open sources WebOS before they go out of business. WebOS is actually a very good platform with very interesting ideas. Unfortunately, the hardware it runs on is complete crap.

  5. Jobs’ competence in things legal seems rather weak, judging from that recent options backdating issue.

    Palm people have reason to be vindictive, as Apple implicated Rubinstein and Anderson (who had to resign) in that.

    And, ultimately, Palm is following the Kawasaki rulebook, so…

  6. Every reputable tech firm requires employees to sign nondisclosure agreements to prevent proprietary information being used by competitors. If Jobs was begging Palm to adopt a “nonpoaching agreement” it would demonstrate:

    1. Jobs’ fear of losing dissatisfied and/or vengeful employees with critical information.
    2. Jobs’ fear of losing necessary talent.
    3. Jobs’ fear of competitors gaining and economic advantage.
    4.Job’s ignorance of federal antitrust laws and/or risks of collusion.
    5. Any combination of the above.

  7. Seems simple and straightforward to me:

    “Here’s a little warning shot across your bows Colligan…”

    “You recruit our team and you better look to defend yourself against any and all patent thefts…”

    Quite right too. Just like Microtheft, Palm are proven not to be able to innovate, so they resort to theft…

  8. To me, this just adds to the long list of unethical actions and standards Jobs has continued to embody. From dumping The Waz, to potentially “poaching” the idea for iTunes from his neighborning company, now defunct, Personics. Apple users have been mislead as to what Apple represents, it doesn’t represent independence, alternative style, etc. but rather one man’s wreckless abandon to climb to the top.

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