Disney agrees to pay a whopping $100 million to settle an anti-poaching lawsuit brought on by its own animators and special effects wizards

The anti-poaching pact among the major movie animation and special effects studios colluded to keep workers' wages down
Another day, another big-dollar settlement for the Walt Disney Company in yet another major class-action lawsuit over charges of illegal anti-labor business practices.

Mickey Mouse was found guilty again of unfair labor practices, but this time
it will cost the mouse more than $100 million
The Walt Disney Company has agreed to pay $100 million to settle charges over unfair and anti-competitive labor practices in a class-action lawsuit brought on by its animators and visual effects workers who alleged that several major Hollywood studios colluded with Disney to adhere to an anti-poaching pact that kept workers' wages down since the 1980s.

Not surprisingly, Disney and its subsidiaries, Pixar Animation Studios and LucasFilm, were the last holdouts among the major movie studios to settle the long-running class-action suit that charged the animation movie studios of colluding to keep workers' wages down by preventing the studios, in a secret pact, from trying to lure each other's talent away from one another with incentives of better pay and work benefits.

The other defendants in the lawsuit—namely DreamWorks Animation, Sony Pictures Animation, and 20th Century Fox's Blue Sky Studios—already agreed to settle their cases last year for about $170 million in total with the plaintiffs of the suit.


Disney's proposed settlement, filed on January 31st, still has to be approved by U.S. District Judge Lucy H. Koh, and is the largest on record of any of the individual defendants' settlements thus far. The settlement damages encompasses liabilities for Disney and its subsidiaries Pixar, LucasFilm, and another one of Disney's subsidiaries, Two Pic MC.

Another embarrassing admission of Disney implementing
unfair labor practices will cost the company dearly
The class-action lawsuit, involving all the animation and special effects studios in Hollywood, was originally filed by former DreamWorks animation artist Robert Nitsch Jr. in September of 2014 in the U.S. District Court in San Jose, California.

The suit alleged that visual effects and digital animation companies in the movie industry "conspired to systematically suppress wages and salaries of those who they claim to prize as their greatest assets—their own workers."

The unfair labor practices of these movie companies, colluding to form an anti-poaching pact, began in the 1980s when Pixar and LucasFilm agreed not to "cold call" each other's employees to try to entice them to jump ship at new and better jobs for more money and better worker benefits.

This kind of unfair labor practice has since been deemed to be uncompetitive and damaging to the free labor market on behalf of the workers' interests.

The lawsuit was filed following a U.S. Department of Justice probe into similar anti-poaching labor collusion tactics used by numerous high-tech companies in Silicon Valley, including Pixar, Apple, Google, and Intel. Those companies settled with the U.S. Department of Justice in 2010, agreeing not to further engage in such anticompetitive, no-solicitation labor practices that harmed their workers.


After that Dept. of Justice probe ended, those high-tech companies faced a separate class-action civil lawsuit over the same anti-poaching claims brought on by their own software engineers as plaintiffs in 2012, which settled out of court in 2015.

Disney is learning the hard way: Greed is not good, especially when
linked to its public image with its employees and paying customers
Class-action certification for the current lawsuit involving the movie studios was approved by Judge Koh in May.

It involved more than 10,000 potential plaintiffs who might have been affected by the suit at the time of filing.

“We achieved a recovery for the class that we think is substantial and fair,” said attorney Steven G. Sklaver of Susman Godfrey, who represented the plaintiffs along with lawyers from Cohen Milstein Sellers & Toll and Hagens Berman Sobol Shapiro. “This is a conspiracy that involved suppressing compensation for employees all because it was viewed to be a cost that the companies didn’t want to incur.”

The proposed settlement, if approved, will force Disney to pay $100 million in compensatory damages to the plaintiffs, not including legal costs which Disney will also be responsible to pay, plus a permanent injunction to prohibit such anti-labor practices from the studio in the future.

As expected, Disney did not respond for comment on the matter; however, there are several reports that a number of large labor law firms practicing in the area of class-action lawsuits are looking for prospective plaintiffs who are working in The Disney Store retail operations who want to file a similar class-action civil lawsuit on behalf of retail workers against Disney who were taken advantage by Disney's previous on-call work schedules that Disney had recently settled with nine state Attorney Generals' offices across the nation.


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