August 21, 2015 / 3:57 PM / in 2 years

Hollywood studios must face animators' anti-poaching lawsuit

(Reuters) - Several major Hollywood studios failed to persuade a federal judge to dismiss a antitrust lawsuit accusing them of illegally conspiring not to poach each others' animators, to help drive down wages.

In a Thursday night decision, U.S. District Judge Lucy Koh in San Jose, California, rejected the dismissal request by Walt Disney Co and its Lucasfilm and Pixar units, Sony Corp, DreamWorks Animation SKG Inc and 21st Century Fox Inc's Blue Sky Studios.

Without ruling on the merits, Koh said emails and other evidence suggested that the studios agreed not to solicit each other's workers, shared information about pay practices, offered "misleading, pretextual" reasons to justify why wages were not higher, and took steps to keep their conspiracy a secret.

"These allegations raise a plausible inference that defendants entered into an express agreement to suppress compensation," Koh wrote in a 55-page decision.

A lawyer for Disney declined to comment, as did DreamWorks spokesman Dan Berger. Other defendants and their lawyers did not immediately respond to requests for comment.

Animators accused the studios of suppressing wages since 2004 by refraining from cold-calling employees, sharing news of job offers, and trying to "not have a hiring war," a quotation attributed to Pixar President Ed Catmull.

The animators said the conspiracy originated with Pixar and Lucasfilm and later drew in rival studios, including when Steve Jobs, then at Pixar, and DreamWorks Chief Executive Officer Jeffrey Katzenberg "personally discussed" DreamWorks' joining the scheme.

Koh had dismissed the lawsuit in April, partly because many claims were brought too late.

But she said the amended complaint sufficiently alleged that the studios tried to fraudulently conceal their conspiracy and that the statute of limitations could therefore be put on hold.

Jeff Friedman, a lawyer for the animators, said his clients "appreciate Judge Koh's lengthy and detailed analysis" and "look forward to the opportunity to litigate this important case."

The lawsuit raised many of the issues underlying a 2009 U.S. Department of Justice probe into Silicon Valley recruiting and a separate $415 million settlement of claims that Apple Inc, Google Inc, Intel Corp and Adobe Systems Inc agreed not to poach each other's engineers.

Koh approved that accord in March.

The named plaintiffs in the animators' lawsuit are lighting artist Georgia Cano, character effects artist Robert Nitsch and production engineer David Wentworth.

The case is In re: Animation Workers Antitrust Litigation, U.S. District Court, Northern District of California, No. 14-04062.

Reporting by Jonathan Stempel in New York; Editing by Lisa Von Ahn

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