Intuit Admits Antitrust Violations

Filed in Intuit QuickBooks by on September 25, 2010

After years of conspiring by Apple, Adobe, Google, Intel, Intuit and Pixar, Intuit admits antitrust violations. The Justice Department said the companies acknowledged agreeing, starting in 2005, not to “cold call” competitor employees.

This involved a web of deals to eliminate competition and seriously violate federal antitrust law, as charged in a Justice Department antitrust lawsuit. Apple, Adobe, Google, Intel, Pixar and Intuit admits the antitrust violations and agreed to refrain from them for five years. There was no question Intuit would have to admit the antitrust violations, as the Justice Department obtained copies of these agreements between the companies:

Deal #1 – Beginning 2006, Apple and Google agreed to place each other on their HR Departments “Do Not Call” list.
Deal #2 – From May 2005, Apple set up a similar deal with Adobe.
Deal #3 – From April 2007, Apple and Pixar management agreed not to cold call each other’s employees.
Deal #4 – Google and Intuit agreed to a “cease fire” regarding cold calling employees in June 2007.
Deal #5 – Three months later, Google and Intel agreed to a similar deal.

The secret agreements, not to call each other’s employees at work, were no surprise to Silicon Valley veterans. Here are some quotes. “It happens all the time. The do not call scandal will be like the stock options backdating of the ’90s. Everybody did it. It was standard operating procedure.” “It’s like price-fixing the cost of your raw materials, but for these companies, their most valuable resource is intellectual property – their employees. By manipulating the workforce, they will set the price of raw material for their business, thereby affecting the ultimate price to consumers.”

One guilty company executive said, “You can steal someone’s employees through LinkedIn or personal references, but don’t cold-call them at work.” “The problem is there also is a victim. The practices are good for the bottom line, but blatantly unfair to rank-and-file (employees). If an engineer in a real niche can’t work for four out of five companies, he is stuck at his current employer and missing out on more money.”

“If you cut deals on how you hire people, you also might cut deals on the prices, or divvy the market up inappropriately.” Cozy relationships between top execs increase the danger of collusion. Google’s CEO was on Apple’s board before a Federal investigation. Intuit’s Chair is on Apple’s board and was a close advisor to Google’s founders. Intel’s CEO is on Google’s board and Apple’s CEO is on the board of Walt Disney, which owns Pixar. Many of the companies also use one venture capital firm, now tarred by wasteful Cap and Trade actions.

One expert said some companies make deals at top levels, while other anti-poaching edicts are subtle. I talked to former Intuit CEO Steve Bennet about a related Intuit act. Steve had Intuit drop a web list of top execs. He then asked me drop a similar extended list from my website. It is now clear that this relates to having Intuit admit antitrust violations.

That is very sad, considering that Intuit’s #1 Operating Value is supposedly, “Integrity Without Compromise.” To the contrary, having Intuit admit antitrust violations made it clear that Intuit Integrity has become The Big Lie.

(continued in next post)



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