Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-cand-5_14-cv-04062/USCOURTS-cand-5_14-cv-04062-11/pdf.json

Nature of Suit Code: 410
Nature of Suit: Antitrust
Cause of Action: 15:1 Antitrust Litigation

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Case No. 14-CV-04062-LHK

ORDER DENYING DEFENDANTS’ JOINT MOTION TO DISMISS

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UNITED STATES DISTRICT COURT

NORTHERN DISTRICT OF CALIFORNIA

SAN JOSE DIVISION

IN RE ANIMATION WORKERS 

ANTITRUST LITIGATION

THIS DOCUMENT RELATES TO:

ALL ACTIONS

MASTER DOCKET NO.: 14-CV-04062-

LHK 

ORDER DENYING DEFENDANTS’ 

JOINT MOTION TO DISMISS

Re: Dkt. No. 126

Defendants DreamWorks Animation SKG, Inc.; The Walt Disney Company; Lucasfilm 

Ltd., LLC; Pixar; ImageMovers, LLC; Two Pic MC LLC (f/k/a ImageMovers Digital); Sony 

Pictures Animation Inc.; Sony Pictures Imageworks Inc.; and Blue Sky Studios (collectively, 

“Defendants”) have filed a joint motion to dismiss the second amended complaint. (“Mot.”), ECF 

No. 126. Pursuant to Civil Local Rule 7-1(b), the Court finds this motion suitable for disposition 

without oral argument and VACATES the hearing set for September 17, 2015. Having considered 

the parties’ submissions, the relevant law, and the record in this case, the Court DENIES 

Defendants’ motion.

I. BACKGROUND

This is a consolidated class action brought by former employees alleging antitrust claims 

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against their former employers, various animation studios with principal places of business in 

California.1Plaintiffs contend that Defendants engaged in a conspiracy to fix and suppress 

employee compensation and to restrict employee mobility. 

A. Factual Background

The Court draws the following factual background from the uncontroverted allegations in 

the Second Amended Complaint (“SAC”), and from judicially noticed documents.2 Unless 

otherwise noted, Plaintiffs’ allegations are presumed to be true for purposes of ruling on 

Defendants’ motion to dismiss. Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009).

1. The Parties

Defendants include the following animation and visual effects studios: Blue Sky Studios, 

Inc. (“Blue Sky”), a Delaware corporation with its principal place of business in Greenwich, CT; 

DreamWorks Animation SKG, Inc. (“DreamWorks”), a Delaware corporation with its principal 

place of business in Glendale, CA; ImageMovers Digital LLC, a Delaware corporation with its 

principal place of business in Burbank, CA; Lucasfilm Ltd., LLC (“Lucasfilm”), a California 

corporation with its principal place of business in San Francisco, CA;3Pixar, a California 

 

1 Defendant Blue Sky Studios, Inc. has its principal place of business in Greenwich, CT, but 

Plaintiffs allege that it is owned by Twentieth Century Fox Film Corporation, which has its 

principal place of business in Los Angeles, California. SAC ¶ 22. 

2

In its initial order granting Defendant’s motion to dismiss, the Court granted Defendants’ 

unopposed request for judicial notice, ECF No. 76, and took notice of the adjudicative facts 

contained therein. Defendants requested that the Court take judicial notice of the Civil 

Investigative Demands issued by the Department of Justice; public records from the State of 

Delaware; the expert report of Edward E. Leamer, as filed in In re High-Tech Antitrust Litig., Case 

No. 11-CV-2509-LHK, ECF No. 856-8; media articles regarding the DOJ investigation; and an 

advertisement published by Plaintiffs’ counsel. See United States ex rel. Robinson Rancheria 

Citizens Council v. Borneo, Inc., 971 F.2d 244, 248 (9th Cir. 1992) (holding a court may take 

notice of proceedings in other courts); Lee v. City of Los Angeles, 250 F.3d 668, 689–90 (9th Cir. 

2001) (matters of public record); MGIC Indem. Co. v. Weisman, 803 F.2d 500, 505 (9th Cir. 1986) 

(court records); Von Saher v. Norton Simon Museum of Art at Pasadena, 592 F.3d 954, 960 (9th 

Cir. 2010), overruled on other grounds by Galbraith v. Cnty. of Santa Clara, 307 F.3d 1119, 

1125–26 (9th Cir. 2002) (media publications); see also Fed. R. Evid. 201(d).

Similarly, in its initial order granting Defendants’ motion to dismiss, the Court granted 

Plaintiffs’ unopposed request for judicial notice, ECF No. 97 at 37, and took notice of the 

adjudicative facts contained therein. Plaintiffs requested that the Court take judicial notice of two 

sealing orders from the High-Tech litigation and a media report. See Lee, 250 F.3d at 689–90; Van 

Saher, 592 F.3d at 960.

3

Plaintiffs aver that Industrial Light & Magic (“ILM”) is a division of Lucasfilm. 

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corporation with its principal place of business in Emeryville, CA; 4Sony Pictures Animation, Inc. 

and Sony Pictures Imageworks, Inc. (collectively, “the Sony Defendants”), California corporations 

with their principal places of business in Culver City, CA; and The Walt Disney Company 

(“Disney”) is a Delaware corporation with its principal place of business in Burbank, CA.5SAC

¶¶ 22–29.

Plaintiffs Robert A. Nitsch, Jr., Georgia Cano, and David Wentworth (collectively, 

“Plaintiffs”), are artists and engineers that were previously employed by four of the named 

Defendants. Id. ¶¶ 19–21. Nitsch worked for Sony Picture Imageworks in 2004 and DreamWorks 

from 2007 to 2011. Id. ¶ 19. Cano worked for Walt Disney Feature Animation from 2004 to 2005, 

ImageMovers Digital in 2010, and at various other visual effects and animation studios. Id. ¶ 20. 

Wentworth worked at ImageMovers Digital from 2007 to 2010. Id. ¶ 21. Nitsch is a resident of 

Massachusetts, and Cano and Wentworth are residents of California. Id. ¶¶ 19–21. 

Plaintiffs seek to represent the following class:

All persons who worked at any time from 2004 to the present for 

Pixar, Lucasfilm, DreamWorks Animation, Walt Disney Animation 

Studios, Walt Disney Feature Animation, Blue Sky Studios, Digital 

Domain, ImageMovers Digital, Sony Pictures Animation or Sony 

Pictures Imageworks in the United States. Excluded from the Class 

are officers, directors, senior executives and personnel in the human 

resources and recruiting departments of the Defendants.

Id. ¶ 195.

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2. In re High-Tech Employees Litigation and the Department of Justice investigation

There is significant factual overlap between Plaintiffs’ allegations and the related action In 

re High-Tech Employees Litigation, No. 11-CV-02509-LHK, as well as the civil complaints filed 

by the Department of Justice (“DOJ”) against several Silicon Valley technology companies, Pixar, 

and Lucasfilm. As both the factual and procedural history of the related action, In re High-Tech, 

 

4 According to Plaintiffs, ILM, Lucasfilm, and Pixar have been owned by Defendant The Walt 

Disney Company since 2012. SAC ¶¶ 25–26. 

5 Disney also “oversees the operations of” Walt Disney Animation Studios, formerly known as 

Walt Disney Feature Animation. SAC ¶ 29.

6

Plaintiffs also allege that “[t]he relevant Class members do not bring in this complaint any claims 

against Pixar, Lucasfilm and Disney that were released [in High-Tech].” SAC ¶ 196.

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and the DOJ investigations and complaints are relevant to the substance of Defendants’ motion to 

dismiss, the Court briefly summarizes the background of that litigation below. 

From 2009 to 2010, the Antitrust Division of the DOJ investigated the employment and 

recruitment practices of various Silicon Valley technology companies, including Adobe Systems, 

Inc., Apple, Inc., Google, Inc., Intel Corp., and Intuit, Inc. See In re High-Tech Employees Litig., 

856 F. Supp. 2d 1103, 1109 (N.D. Cal. 2012). In September of 2010, the DOJ then filed civil 

complaints against the above-mentioned technology companies, in addition to Pixar and 

Lucasfilm. Id. The DOJ filed its complaint against Adobe, Apple, Google, Intel, Intuit, and Pixar 

on September 24, 2010. Id. On December 21, 2010, the DOJ filed another complaint against 

Lucasfilm and Pixar. See No. 11-2509, ECF No. 65. The defendants, including Pixar and 

Lucasfilm, stipulated to proposed final judgments in which they agreed that the DOJ’s complaints 

had stated claims under federal antitrust law and agreed to be “enjoined from attempting to enter 

into, maintaining or enforcing any agreement with any other person or in any way refrain from . . . 

soliciting, cold calling, recruiting, or otherwise competing for employees of the other person. 

High-Tech, 856 F. Supp. 2d at 1109–10 (quoting Adobe Proposed Final Judgment at 5). The D.C. 

District Court entered the stipulated proposed final judgments in March and June of 2011. Id. at 

1110.

The High-Tech plaintiffs filed five separate state court actions between May and July of 

2011. Following removal, transfer to San Jose to the undersigned judge, and consolidation, the 

High-Tech plaintiffs filed a consolidated amended complaint on September 13, 2011. Id. at 1112–

13. In their complaint, the High-Tech plaintiffs alleged antitrust claims against their employers, 

claiming that the defendants had conspired “to fix and suppress employee compensation and to 

restrict employee mobility.” Id. at 1108. More specifically, the High-Tech plaintiffs alleged a 

conspiracy comprised of “an interconnected web of express bilateral agreements.” Id. at 1110. One 

agreement, the “Do Not Cold Call” agreement involved one company placing the names of the 

other company’s employees on a “Do Not Cold Call” list and instructing its recruiters not to cold 

call the employees of the other company. Id. In addition to the “Do Not Cold Call” agreements, 

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the High-Tech plaintiffs also alleged that Pixar and Lucasfilm, defendants in both High-Tech and 

the instant action, entered into express, written agreements to (1) not cold call each other’s 

employees, (2) to notify the other company whenever making an offer to an employee of the other 

company, and (3) not to engage in “bidding wars.” Id. at 1111. 

3. Alleged Conspiracy in the Instant Action

Here, Plaintiffs allege that Defendants conspired to suppress compensation in two ways. 

First, Defendants allegedly entered into a scheme not to actively solicit each other’s employees. 

SAC ¶ 42. Second, Defendants allegedly engaged in “collusive discussions in which they 

exchanged competitively sensitive compensation information and agreed upon compensation 

ranges,” which would artificially limit compensation offered to Defendants’ current and 

prospective employees. Id.

a. Anti-Solicitation Scheme

According to Plaintiffs, “Defendants agreed not to contact their coconspirators’ employees 

to inform them of available positions unless that individual employee had applied for a job 

opening on his or her own initiative.” Id. ¶ 43. This solicitation, also known as “cold calling,” is “a 

key competitive tool in a properly functioning labor market, especially for skilled labor.” Id.

¶ 44. Plaintiffs aver that employees of competitor studios represent “one of the main pools of 

potential hires,” and that employees of competitor studios that are not actively searching for new 

employment are “more likely to be among the most sought after employees.” Id. Hiring an 

employee from a competitor studio “can save costs and avoid risks.” Id. Absent active solicitation, 

these employees are also difficult to reach. Id. Defendants’ anti-solicitation scheme also allegedly 

included “notifying each other when an employee of one Defendant applied for a position with 

another Defendant, and agreeing to limit counteroffers in such situations.” Id. ¶ 45. Moreover, 

Defendants allegedly “often refrained from hiring other Defendants’ employees at all without the 

permission of the current employer,” and would sometimes decline to make offers of employment 

to an unemployed prospective hire if that individual had an outstanding offer from another 

Defendant. Id. ¶ 46. 

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Pixar and Lucasfilm: According to Plaintiffs, “the roots of the conspiracy reach back to the 

mid-1980s,” when George Lucas, the former Lucasfilm Chairman of the Board and CEO, sold 

Lucasfilm’s “computer division” to Steve Jobs, who had recently left Apple. Id. ¶ 47. Jobs named 

his new company Pixar. Id. Pixar’s President, Ed Catmull, Lucas, and “other senior executives, 

subsequently reached an agreement to restrain their competition for the skilled labor that worked 

for the two companies.” Id. Pixar drafted the terms of the agreement, which both Defendants 

communicated to their senior executives and “select human resources and recruiting employees.” 

Id. Lucas stated in an email that Pixar and Lucasfilm “have agreed that we want to avoid bidding 

wars,” and that the agreement prevented the two companies from “raid[ing] each other’s 

companies.” Id. Pixar and Lucasfilm allegedly agreed to the following terms: (1) not to cold call 

each other’s employees; (2) to notify each other when making an offer to the other company’s 

employee; and (3) that any offer by the other company would be “final,” i.e., neither Pixar nor 

Lucasfilm would engage in counteroffers. Id. ¶¶ 47–51 (citing internal Pixar email sent on January 

16, 2006).

Plaintiffs further allege that while the conspiracy originated with Pixar and Lucasfilm, 

Catmull brought additional studios into the fold. Id. ¶ 52. In a 2005 email, then Vice President of 

Human Resources at Pixar, Lori McAdams, wrote “With regard to ILM, Sony, Blue Sky, etc., we 

have no contractual obligations, but we have a gentleman’s agreement not to directly solicit/poach 

from their employee pool.” Id. ¶ 53. Pixar also drafted an internal “competitors list” that “listed 

anti-solicitation rules for each of the Defendants.” Id. According to Plaintiffs, Blue Sky, 

DreamWorks, ImageMovers Digital, Sony Pictures Imageworks, and Walt Disney Animation 

Studios were “all listed with directions not to ‘recruit directly’ or ‘solicit or poach employees.’” 

Id. Plaintiffs’ allegations as to each Defendant’s alleged role and participation in the antisolicitation scheme is detailed below.

DreamWorks: Jobs and DreamWorks CEO, Jeffrey Katzenberg, “personally discussed 

DreamWorks joining into the conspiracy.” Id. ¶ 55. In a February 18, 2004 email from Catmull to 

Jobs, Catmull stated that the mutual agreement “worked quite well.” Id. A January 14, 2007 email 

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from Catmull to Disney’s Chairman Dick Cook, also provided that “we have an agreement with 

Dreamworks not to actively pursue each other’s employees.” Id. In further emails between 

Catmull, McAdams, and DreamWorks’s head of human resources, Kathy Mandato, Pixar and 

DreamWorks reiterated their “non-poaching practices.” Id. ¶ 56. Mandato explained to McAdams 

that she “thought that we already had this kind of arrangement in place, based on a conversation 

between Steven Spielberg and Steve Jobs.” Id. ¶ 57. When a Pixar recruiting email was sent to a 

DreamWorks employee, Mandato reached out to McAdams, and McAdams responded that she’d 

“put a stop to it!” Id. ¶ 58.

Disney: A 2005 Pixar email “confirmed that Pixar would not recruit workers out of Disney 

or other studios.” Id. ¶ 60. In 2006, Disney purchased Pixar, and Catmull assumed responsibility 

for Walt Disney Animation Studios. Id. In communications between Disney Chairman Cook and 

Catmull, Cook agreed that “avoid[ing] raiding each other” was necessary to avoid “seriously 

mess[ing] up the pay structure.” Id. Cook allegedly promised to “reaffirm our position again” with 

ImageMovers Digital, which Plaintiffs contend is a joint venture Disney launched with 

ImageMovers.7Id. In 2006, Disney’s Director of Animation Resources apparently asked ILM, a 

division of Lucasfilm, to “observe ‘the Gentlewomen’s agreement’” that ILM not recruit Disney 

digital artists. Id. ¶ 61. In 2009, Karen Toliver, the Vice President of Animation at Twentieth

Century Fox, the owner of Blue Sky, apparently emailed the Chief Operating Officer of Blue Sky, 

Briane Keane, regarding a Disney employee who was interested in “explor[ing] opportunities with 

Blue Sky.” Id. ¶ 62. According to Plaintiffs, because of Blue Sky and Disney’s agreement, 

however, Blue Sky’s Keane responded to Toliver that “we need to be sensitive and not reach out 

in a way that could get back to Disney.” Id.

Sony Defendants: Beginning in 2002, Sony Pictures Imageworks expanded significantly by 

 

7 Defendants submit that Exhibit F in their request for judicial notice, consisting of Certificates of 

Corporate Formation and Amendment filed with the Secretary of State of the State of Delaware, 

Division of Corporations, disproves Plaintiffs’ allegation that ImageMovers LLC was a party to 

the joint venture that created ImageMovers Digital. See ECF No. 76. Plaintiffs voluntarily 

dismissed ImageMovers LLC from this action after Defendants filed their motion to dismiss and 

request for judicial notice. Consequently, the Court concludes that ImageMovers’s involvement in 

the purported joint venture is not relevant. 

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offering higher salaries to lure workers away from other studios. Id. ¶ 63. In response, Catmull 

allegedly met with Sony executives in person in 2004 or 2005 to “ask[] them to quit calling our 

employees.” Id. ¶ 65. Plaintiffs allege that Catmull reached an agreement with Sony at that time 

that the companies would not directly solicit or poach from each other. Id. Following this 

agreement, McAdams contacted Sony’s recruiting team when a Pixar employee left to work at 

Sony of his own initiative and a Sony recruiter apparently asked “if another employee was ‘still 

employed and if she [could] contact [that employee].’” Id. ¶ 67. McAdams spoke to an individual 

at Sony “in person and over the phone to ‘make sure they’re still honoring [the agreement] as they 

may have had turnover in their Recruiting team.’” Id. Similarly, when a Sony recruiter contacted a 

Pixar employee in October 2006, McAdams apparently contacted her counterpart at Sony to “tell 

them to knock it off.” Id. By July 2009, “Sony was insistent that the non-solicitation agreement be 

observed.” Id. ¶ 68. When a recruiter from a smaller studio, ReelFX, contacted Sony employees, 

Sony Pictures Digital President Bob Osher emailed ReelFX. Id. Osher threatened not only to 

withhold business from ReelFX but stated that “Dreamworks and others will avoid hiring Reel 

Effects as well.” Id.

Blue Sky Studios: Plaintiffs aver that Blue Sky “similarly entered the conspiracy,” did not 

recruit from other studios, and requested that other studios not recruit from Blue Sky. Id. ¶ 69. In 

2005, Blue Sky allegedly declined to pursue a DreamWorks employee that would have been “an 

amazing addition,” because Blue Sky did not “want to be starting anything with [Katzenberg, the 

DreamWorks CEO] over one story guy.” Id. 

On September 29, 2004, McAdams explained that “[w]ith regard to ILM, Sony, Blue Sky, 

etc., we have no contractual obligations, but we have a gentleman’s agreement not to directly 

solicit/poach from their employee pool. . . . This agreement is mutual, so if you ever hear that the 

studios are calling our people, let me know right away and I’ll take care of it (as was the case with 

Sony a few months ago).” Id. ¶ 70. Blue Sky’s Director of Human Resources, Linda Zazza, also 

allegedly spoke with Pixar’s McAdams to discuss “our sensitive issue of employee retention,” and 

McAdams assured Blue Sky that Pixar was not attempting to poach Blue Sky employees. Id. ¶ 71. 

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When Zazza “noticed a trend of departing employees in 2008,” she allegedly “probed to find out if 

they’ve been approached by Pixar, etc.” Id. ¶ 72. According to Plaintiffs, Managers at Twentieth 

Century Fox Animation, the parent company of Blue Sky, were “careful to honor the agreement,” 

and Twentieth Century Fox President Vanessa Morrison noted that “[w]e have to be careful not to 

poach people” from Sony. Id. ¶ 73.

ImageMovers:

8

ImageMovers allegedly also joined the conspiracy. Catmull wrote in a 

January 2007 email to Disney Chairman Cook that Catmull knew ImageMovers would “not target 

Pixar.” Id. ¶ 75. Plaintiffs allege, however, that ImageMovers continued to recruit from other 

conspiring studios, including DreamWorks, by “offering higher salaries.” Id. ¶ 76. Catmull then 

met with one of the founders of ImageMovers, Steve Starkey. Starkey allegedly told Catmull that 

ImageMovers had informed Lucas that ImageMovers would “not raid ILM.” Id. ¶ 77. Catmull 

then contacted Disney Studio’s President, Alan Bergman, and Senior Vice President of Human 

Resources, Marjorie Randolph, requesting that they require the ImageMovers Defendants to 

comply with the anti-solicitation scheme. Id. ¶ 78. According to Plaintiffs, Randolph “responded 

that Disney had in fact gotten the ImageMovers Defendants to agree to the ‘rules’ of the antisolicitation scheme.” Id.

An October 10, 2008, Lucasfilm email confirmed that the “resulting agreement” applied to 

“any type of position.” Id. ¶ 77. Similarly, ILM Recruiter Lori Beck confirmed that potential 

recruits were “not available” when “working at IMdigital [sic].” Id. In 2009, Beck stated that ILM 

should not pursue an employee because “we have the gentlemen’s agreement with IMD,” and 

again stated that “we have a gentlemen’s agreement with IMD that we cannot recruit people from 

their studio.” Id. ¶ 79. Lori McAdams of Pixar also noted in an email that “[w]e can’t call our 

friends or leads who work at IMD, or Disney Animation (or Lucasfilm) and try to entice them to 

apply.” Id.

Digital Domain9: Digital Doman allegedly joined the conspiracy and had anti-solicitation 

 

8

Plaintiffs dismissed ImageMovers LLC without prejudice pursuant to a tolling agreement on 

January 14, 2015. ECF No. 83. 

9

Plaintiffs also dismissed Digital Domain 3.0 without prejudice pursuant to a tolling agreement. 

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agreements with “at least” DreamWorks, Lucasfilm/ILM, and the Sony Defendants. Id. ¶ 80. 

According to Plaintiffs, starting in 2007, Digital Domain hired a new Head of Human Resources 

Lala Gavgavian. Id. ¶ 82. Gavgavian had previously worked at Lucasfilm’s ILM division “in 

senior roles in talent acquisition . . . during which time Pixar President Jim Morris explicitly 

informed her that Pixar and Lucasfilm” had an anti-solicitation/no-poaching agreement. Id. 

Gavgavian and other senior personnel at Digital Domain allegedly “specifically instructed 

employees not to cold call or otherwise solicit other Defendants’ employees.” Id. ¶ 83. 

As to all Defendants, Plaintiffs contend that Defendants “repeatedly sought to recruit” new 

studios into the scheme, including a small studio named Lightstream Animation in 2008. Id. ¶ 84. 

b. Compensation Ranges

In addition to the anti-solicitation scheme, Plaintiffs further allege that Defendants 

“directly communicated and met regularly to discuss and agree upon compensation ranges.” Id. 

¶ 86 (citing March 28, 2007 email from McAdams). According to Plaintiffs, Defendants met at 

least once a year in California at meetings organized by the Croner Company, a third party that 

apparently collects industry-specific salary information. At the official meetings, Defendants “set 

the parameters of a compensation survey” that “provides wage and salary ranges for the studios’ 

technical or artistic positions, broken down by position and experience level.” Id. ¶ 87. The 

purpose of the meetings was for Defendants to “confirm or adjust [their] salary ranges.” Id. Senior 

human resources and recruiting personnel from DreamWorks, Pixar, Lucasfilm/ILM, Disney, 

ImageMovers, the Sony Defendants, Blue Sky, and Digital Domain attended these survey 

meetings, in addition to other studios. Id. ¶ 88. Defendants also requested “custom cuts” of the 

survey information collected by the Croner Company, which allegedly involved a “special subset 

of Croner Survey participants, namely Blue Sky, DreamWorks, Lucasfilm, Sony, and Pixar.” Id.

¶ 93.

Plaintiffs aver that Defendants used the Croner meetings to “go further than their matching 

of job positions across companies; they discussed, agreed upon and set wage and salary ranges 

 

See SAC at 19 n.3.

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during meals, drinks and other social gatherings that they held outside of the official Croner 

meetings.” Id. ¶ 89. It was at one such side meeting in 2007 that Pixar discovered that 

ImageMovers was recruiting employees away from DreamWorks “at substantial salary 

increase[s],” which prompted Pixar’s president, Catmull, to contact Disney’s chairman. 

Defendants’ human resources and recruiting personnel also allegedly held “side” meetings at the 

Siggraph conference, a major visual effects industry conference, which senior personnel from Blue 

Sky, Pixar, DreamWorks, Lucasfilm, and Sony Picture ImageWorks attended. Id. ¶ 91. 

Defendants’ Directors of Human Resources also allegedly “frequently sought to create new 

relationships when one of their counterparts was replaced at a co-conspirator to ensure the efficacy 

of communications about the conspiracy,” and met with each other one-on-one “on many 

occasions.” Id. ¶¶ 91–92. Plaintiffs further allege that Defendants regularly emailed each other 

with specific salary ranges. On May 13, 2005, DreamWorks requested that Disney provide salary 

information on three positions, and Disney promptly responded. Id. ¶ 94. The following spring, 

DreamWorks also requested similar information from Pixar and Disney, and “made clear it was 

surveying multiple studios.” Id. ¶ 95. On September 2, 2009, Blue Sky’s Director of Human 

Resources requested salary range information from Pixar. Id. ¶ 96. Plaintiffs contend that 

Defendants’ “collusive compensation setting was not limited to wages and salaries, but extended 

to other benefits and terms of employment.” Id. ¶ 97. 

In a 2007 email, DreamWorks’ Head of Compensation explained that “we do sometimes 

share general comp information (ranges, practices) in order to maintain the relationships with 

other studios and to be able to ask for that kind of information ourselves when we need it.” Id.

¶ 100. For example, a DreamWorks HR officer emailed Pixar’s McAdams and Disney HR 

executives to ask whether Disney matched employee 401K contributions, and Disney HR 

responded with numbers. Id. ¶ 98. McAdams responded within a half an hour with percentage 

details. Id. Similarly, McAdams asked Lucasfilm and DreamWorks executives whether they had 

policies to reimburse memberships for employees. Id. ¶ 99. 

According to Plaintiffs, Defendants’ communications regarding salary ranges were not 

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limited to bilateral “one off” exchanges, but rather Defendants would “openly email[] each other 

in large groups with competitively sensitive confidential current and future compensation 

information.” Id. ¶ 102. On November 17, 2006, Pixar’s McAdams emailed senior human 

resources personnel at DreamWorks, Sony Pictures Imageworks, Lucasfilm, Walt Disney 

Animation Studios, and others: 

Quick question from me, for those of you who can share the info.

What is your salary increase budget for FY ’07? Ours is 

[REDACTED] but we may manage it to closer to [REDACTED] on 

average. Are you doing anything close, more, or less?

Id. ¶ 103. In January 2009, DreamWorks’s Head of Production Technology emailed the heads of 

human resources at Pixar, ILM, Sony Pictures Animation, and Disney to “learn how they handled 

overtime.” More specifically, DreamWorks wanted to “see if the other companies were ‘as 

generous.’” Id. ¶ 88. On February 14, 2007, McAdams emailed human resources personnel at 

DreamWorks, Sony, Disney, ILM, and another studio to find out the “base salary range” for a 

“manager of archives position.” Id. ¶ 105. McAdams disclosed that Pixar intended to place the 

position in the “$60K-80K base” range, but wanted to “do a reality check as we head into salary 

discussions.” Id. McAdams sent a similar email on May 1, 2007, regarding salary ranges for a 

supervising animator position. She asked Disney and others to “[s]hare with me your base salary 

range, perhaps how many of these folks you have (we have 7) and a general idea of actual median 

base pay? Also knowing any other comp they are eligible for (e.g. bonuses or stock) would be 

helpful.” Id. ¶ 107. Similarly, McAdams also apparently directed Pixar’s staff in the compensation 

department to “talk with Disney or other studios & post houses to ensure that our salary ranges for 

the positions are correct.” Id. ¶ 106. 

These collusive exchanges were also allegedly reflected in internal company documents. 

For example, a Lucasfilm document in 2006 included a chart for fiscal year 2004 and fiscal year 

2005 salary information for competitor studios such as Twentieth Century Fox, Sony, and Disney, 

and stated that “updates” of these figures were “ongoing,” which apparently indicated that 

conspirators continued to collude on wages through the period. Id. ¶ 101. 

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Defendants’ human resources and recruiting personnel also allegedly regularly 

communicated via telephone. Id. ¶ 112. Plaintiffs quote emails from Pixar’s McAdams to Sony 

Pictures Imageworks, ILM, DreamWorks, Disney, and Blue Sky “in early 2007” stating that 

“[c]hatting with all of you each day is really becoming a fun habit,” and an email response from 

Walt Disney Animation Studios Vice President of Human Resources also commenting that “[i]t is 

fun to hear from you all on a daily basis.” Id. ¶ 113.

As Plaintiffs describe it, the Croner survey meetings, side meetings, emails, and telephone 

calls “provided the means and opportunities for Defendants to collude and to implement and 

enforce the conspiracy to suppress workers’ compensation.” Id. ¶ 114. Plaintiffs note that 

McAdams also emailed ILM’s Senior Director of Human Resources Sharon Coker in June 2008 

stating that “[s]ince money can always be a factor, that’s the other thing we should consider (e.g. 

we wouldn’t want to offer a lateral move more money than you, and vice versa).” Id. ¶ 109. 

According to Plaintiffs, both McAdams and other executives “knew that such conversations were 

inappropriate,” and expressed concern that it might be “taboo” to discuss compensation. Id. ¶ 110. 

In 2008 and 2009, Sony “laid off hundreds of employees and hired many of them back at lower 

rates,” and Sony apparently informed other studios “that [it] was rehiring folks back at a lower rate 

than when they left,” and to “stand firm in [their] offers to exSony candidates and not worry too 

much about matching their last Sony rate.” Id. ¶ 115. 

Plaintiffs further allege that while press reports in 2009 noted that the DOJ was 

investigating anti-solicitation agreements among high-tech companies, including Google and 

Apple, there was no indication that the DOJ was also investigating Pixar, Lucasfilm, or any other 

animation company. Id. ¶ 119. Plaintiffs aver that September 17, 2010 marked the first news story 

naming Pixar as a company under investigation, but that there was no public disclosure that any 

other Defendant in the instant action was part of the conspiracy. Id. ¶¶ 119, 184. According to 

Plaintiffs, Lucasfilm was implicated in the Pixar investigation in December 2010, but until the 

Court unsealed certain filings in the High-Tech case, there was no public information that the other 

Defendants in this action had engaged in similar conduct. Id. Plaintiffs also cite the absence of 

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news coverage as proof that Plaintiffs had no way of discovering the conspiracy, as even industry 

journalists were “unable to discover and explore the conspiracy.” Id. ¶ 186. 

c. Fraudulent Concealment

In their SAC, Plaintiffs allege that Defendants fraudulently concealed the conspiracy and 

therefore prevented the Plaintiffs from filing their claims on time. Plaintiffs allege that Defendants

(1) took affirmative steps to keep their conspiracy a secret; (2) affirmatively misled class members 

by claiming that compensation and recruiting was determined by factors other than the alleged 

conspiracy; and (4) took affirmative steps to mislead class members about the conspiracy during 

the High-Tech litigation.

1. Affirmative steps to keep their conspiracy a secret

Plaintiffs aver that Defendants carried out their conspiracy “in a manner specifically 

designed to avoid detection.” Id. ¶ 136. Plaintiffs claim that Defendants limited meetings to top 

executives and HR employees, “avoided discussing the agreements in written documents,” and 

“avoided unnecessarily creating evidence that might alert Plaintiffs . . . to the conspiracy’s 

existence.” Id. For example, Blue Sky employees allegedly stated that discussions “need[ed] to be 

a phone conversation” due to the “sensitivity” of the subject.10 Id. ¶ 137. Plaintiffs also allege that 

Lucasfilm “code-named” the anti-solicitation agreements as “DNR” agreements, and that 

conversations about the “DNR” agreements needed to be made over the phone. Id. ¶ 138. For 

example, Plaintiffs point to an internal Lucasfilm document that stated: “DNR questions CALL 

Steve. If you see an email forward to Steve and one of our lawyers.” Id. Similarly, Plaintiffs cite 

ILM’s Coker’s deposition testimony that “the reason the agreement was termed a ‘gentleman’s 

agreement’ was because it was not written down.” Id. ¶ 139. A DreamWorks employee explained 

that the head of recruitment described the no-poach agreement to the employee orally, and that a 

 

10 The Court notes that Defendants submitted the complete email exchange that Plaintiffs cite in 

the SAC, and that the relevant quoted portion reads “There is a time sensitive recruiting question 

that needs to be a phone conversation.” See ECF No. 127-1, at 3. While Defendants focus on 

Plaintiffs’ selective quotation, the Court does note that the emails also reference whether 

“everyone is comfortable with . . . efforts made to recruit. This is going to come up a lot and I 

have been reiterating the sensitivity here.” Id. at 2. 

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head recruiter informed the employee that “it was unsaid and certainly not in writing.” Id. ¶ 141. 

Plaintiffs also point out that Defendants sometimes communicated about the conspiracy 

over personal email accounts instead of employer accounts, which Plaintiffs characterize as a 

“sharp deviation from standard business practices.” Id. ¶ 140. Plaintiffs aver that “[t]he most 

logical inference of such atypical business contacts is to avoid detection.” Id.

In addition to using personal emails, Defendants also allegedly “opted for in-person 

meetings” when possible, instead of communication via email. Id. ¶ 143. For example, Pixar’s 

McAdams had dinner with Lucasfilm’s Jan Van der Voort on June 24, 2008, wherein McAdams 

planned “to ask her about their merit increase budget for 2009.” Id.

2. Pretextual statements regarding compensation and recruiting

Plaintiffs further allege that Defendants “routinely provided pretextual, incomplete or 

materially false and misleading explanations for compensation decisions and recruiting and 

retention practices.” Id. ¶ 145. For example, Defendants’ recruiting websites and brochures state 

that they provide “fair” and “competitive salar[ies]” and “competitive compensation,” which, 

according to Plaintiffs, “hid[es] . . . the fact that compensation that normally exists among rival 

employers had been restrained by collusion.” Id. ¶ 146.

Plaintiffs allege that Pixar’s HR department drafted annual “talking points” for its 

managers “in an effort to help prepare [the managers] for [the managers’] conversations with [the 

managers’] employees” about salaries. Id. ¶ 147. Pixar, in these talking points, noted that salaries 

were set by outside surveys. Id. There was no mention of the effects of non-solicitation 

agreements or agreed-upon collusive salary ranges. Id. Similarly, Plaintiffs allege that “[i]n 

response to questions from employees about salary determinations” Pixar instructed its managers 

to inform employees that their salaries were set based on performance, skills, and proficiency, 

without mention of collusion. Id. ¶ 148. This allegedly provided “untrue assurances to employees 

that they were receiving compensation based on what the competitive market would bear—in 

direct contrast to Pixar’s covert conspiracy to suppress the compensation that employees could 

command in an unrestrained labor market.” Id. 

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Moreover, Pixar’s McAdams and ILM recruiter Lori Beck explained to putative class 

members Eben Ostby and Frankie Rodriguez that compensation was competitive without 

disclosing collusion. Id. ¶ 150. On October 24, 2006, McAdams emailed Ostby stating that 

McAdams was “confident that our actual total comp is quite competitive on the average.” Id. Beck 

also emailed putative class member Matthew Bouchard, noting that ILM “consider[s] employee 

equity and the skillset and experience of the entire [Technical Director] group at ILM when 

determining ILM’s rate,” rather than admitting to the conspiracy. Id. Plaintiffs also allege that 

Pixar Senior Recruiter Dawn Haagstad told putative class member Philip Metschan that Pixar’s

initial salary offer to Metschan was the “best offer” Pixar could put out there, noting that “it’s 

important to recognize one’s talent from the start—so that artists don’t feel the need to go back 

and forth regarding money.” Id. ¶ 165. Plaintiffs contend that the real reason Pixar opened with its 

best offer was because it had agreed with co-conspirators to avoid bidding wars.

With regard to employee questions about modest salary increases, Pixar, in one of its 

“talking point” memos, explained that “one of the main reasons” for the modest 3.5% salary 

increase in 2007 was because Pixar sought to fund additional benefit programs for employees, for 

example, a daycare. Id. ¶ 149. Similarly, Ed Catmull, in a company-wide email, defended the 

modest increases as a result of the company’s construction of a new child-care center. Id.

Plaintiffs also allege that Defendants’ own codes of conduct contained statements that 

“misrepresented the truth about the conspiracy.” Id. ¶ 151. Pixar’s code, for example, directed its 

employees and executives to “comply with all applicable governmental laws, rules and 

regulations” and emphasized the importance of “preserving and protecting its proprietary 

information.” Id. ¶¶ 151–52. Plaintiffs contend that this was misleading because Pixar itself was in 

violation of antitrust laws and exchanged proprietary information regarding wages and benefits 

with competitors. Id. Plaintiffs make similar allegations against Disney. Id. ¶¶ 155–58. More 

specifically, Disney’s code provided that “[a]ny decisions related to hiring, evaluating 

performance, promoting, disciplining or terminating Cast Members and employees are made 

fairly, with discretion and respect for privacy.” Id. ¶ 156. Plaintiffs allege that this statement is 

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misleading and false, as “Disney’s hiring decisions were not made fairly.” Id.

Plaintiffs also point to the Defendants’ public filings with the Securities and Exchange 

Commission (“SEC”), as misleading. Id. ¶ 159. DreamWorks, for example, states in its SEC 

filings that it “attract[ed] and retain[ed] [its] animators with competitive compensation packages 

and an artist friendly environment.” Id. ¶ 163. Moreover, in Pixar’s merger agreement with 

Disney, Pixar stated that “[t]o the Company’s Knowledge, the Company and its Subsidiaries are in 

compliance in all material respects with all Laws and Orders . . . relating to the employment of 

labor.” Id. ¶ 160. Pixar’s 2005 10-K form also allegedly contained “affirmative 

misrepresentations,” as Pixar stated that “[w]e believe that the primary competitive factors in the 

market for animated feature films include creative content and talent” and that Pixar “presently 

compete favorably with respect to each of these factors.” Id. ¶ 161. Pixar also represented that 

“[c]ompetition for the caliber of talent required to make our films, particularly our film directors, 

producers, animators, creative personnel and technical directors, will continue to intensify as more 

studios build their in-house CGI-animation or special effects capabilities.” Id. ¶ 162. Plaintiffs 

characterize these statements as misleading because Pixar knew that such competition would not 

intensify as a result of the conspiracy’s efforts to suppress competition. Similarly, DreamWorks 

also publicly assured employees and prospective employees in its SEC filings that it “compete[d]

with other animated film and visual effect studios for artists, animators, directors and producers,” 

and “attract[ed] and retain[ed] our animators with competitive compensation packages and an 

artist friendly environment.” Id. ¶ 163.

Defendants also allegedly made pretextual and misleading statements regarding recruiting 

and retention. Id. ¶ 166. According to Plaintiffs, Defendants “misrepresented the steps they took to 

retain or attract” employees, including Lucasfilm’s statements on its recruiting website that it was 

“continually on the lookout for talent,” despite having agreed not to solicit or cold call employees 

of its competitors. Id. ¶ 166. Lucasfilm’s President and CEO, in a town hall with employees, also

described the “key reasons why people stay” without mentioning the anti-solicitation agreement. 

Id. ¶ 167. Similarly, ILM’s Lori Beck told a recruit that “[o]nce we find strong people, we do our 

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absolute best to keep them with us at ILM,” without mentioning the conspiracy. Id. One of

DreamWorks’s executives was quoted in San Francisco Business Times stating that the market for 

talent was “stiff” and that DreamWork had “stepped up recruiting.” Id. ¶ 169. Plaintiffs contend 

that DreamWorks, at the time, did not face “stiff competition” because of the conspiracy and that 

DreamWorks was not actually “stepp[ing] up” its recruiting.

3. Misleading statements during the High-Tech litigation

Plaintiffs also allege that Defendants Pixar and Lucasfilm made affirmative 

misrepresentations to Plaintiffs and putative class members at the outset of the High-Tech

litigation. Id. ¶ 171. According to Plaintiffs, Pixar and Lucasfilm denied that the anti-solicitation 

agreement “was created with the intent and effect of eliminating bidding wars,” whereby a 

prospective employee could increase her total compensation by leveraging offers from either 

Defendant. Id. ¶ 172. Plaintiffs contend that this denial “affirmatively deceive[d]” Plaintiffs and 

putative class members “as to the purpose of the agreement.” Id. Moreover, Plaintiffs point to 

Pixar’s and Lucasfilm’s apparently misleading statements regarding the scope of their agreement. 

Id. ¶ 173. 

In addition to these representations, Plaintiffs also contend that Defendants Pixar and 

Lucasfilm denied under oath that Pixar or Lucasfilm had “conspired with any entities beyond 

those named by the DOJ.” Id. ¶ 174. Specifically, Plaintiffs cite Pixar’s McAdams’s deposition 

testimony that Pixar did not “have gentleman’s agreements or understandings of that kind with 

any other companies besides Lucasfilm.” Id. ¶ 175. McAdams also apparently described an 

agreement with Defendant Disney as part of a “co-production agreement,” rather than disclosing 

the full breadth of the non-solicitation agreement. Id. Similarly, Lucasfilm’s senior manager of 

compensation, Michelle Maupin, in a sworn declaration filed in High-Tech, described sources of 

information and factors that Lucasfilm used to determine “market compensation levels.” Id. ¶ 177. 

Maupin’s declaration does not mention the communications among Defendants, but instead 

“falsely suggested that compensation was measured against market surveys and self-reporting 

from candidates.” Id.

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Finally, Plaintiffs allege that Defendants “took steps to conceal documents revealing the 

true scope of their conspiracy by designating all depositions, declarations and most documents in 

High-Tech ‘attorneys’ eyes only,’” thus preventing putative class members from examining these 

documents until the Court unsealed the documents in 2013. Id. ¶ 179. According to Plaintiffs, 

Defendants “made the affirmative decision” to file such documents under seal or seek sealing 

“even when such requests were unjustified,” and that the true purpose of Defendants’ actions was 

to “conceal the documents.” Id. ¶ 180. For example, in support of their sealing requests, 

Defendants argued that the documents contained internal decisionmaking regarding business 

strategies and internal assessments of their competitive position in the labor market. Plaintiffs 

contend that these descriptions were misleading as “many of the documents were not internal at 

all: they covered inter-company communications regarding the conspiracy.” Id. ¶ 181. Plaintiffs 

also put forth Defendants’ public statements that the claims in the High-Tech litigation were 

“meritless” as evidence of Defendants’ attempts to conceal the conspiracy. Id. ¶ 182. 

4. Claims

Plaintiffs’ SAC contains three claims for relief under the following statutes: (1) Section 1 

of the Sherman Act, 15 U.S.C. § 1; (2) California’s Cartwright Act, Cal. Bus. & Prof. Code 

§ 16720; and (3) California’s Unfair Competition Law (“UCL”), Cal. Bus. & Prof. Code §§ 17200 

et seq. Plaintiffs seek damages, pre- and post-judgment interest, attorney’s fees and expenses, and 

a permanent injunction. Id. ¶ 147.

B. Procedural Background

In light of the relationship between the instant case and the High-Tech case, the Court 

briefly summarizes the relevant procedural history in High-Tech in addition to the instant case. 

1. High-Tech Procedural Background

The High-Tech defendants removed the first state-court action on May 23, 2011. No. 11-

2509, ECF No. 1. On April 18, 2012, the Court granted in part and denied in part the High-Tech 

defendants’ joint motion to dismiss and denied Lucasfilm’s motion to dismiss. No. 11-2509, ECF 

No. 119. On April 5, 2013, the Court granted in part and denied in part the High-Tech plaintiffs’ 

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motion for class certification with leave to amend. No. 11-2509, ECF No. 382. The Court granted 

the High-Tech plaintiffs’ supplemental motion for class certification on October 24, 2013. No. 11-

2509, ECF No. 531. On November 13, 2013, the High-Tech defendants filed a Rule 23(f) petition 

before the Ninth Circuit, requesting permission to appeal this Court’s October 24, 2013 class 

certification order. No. 13-80223, ECF No. 1. The Ninth Circuit denied the defendants’ petition on 

January 14, 2014. No. 13-80223, ECF No. 18.

In the interim, three of the High-Tech defendants, Intuit, Lucasfilm, and Pixar, reached an 

early settlement with the plaintiffs. On September 21, 2013, the High-Tech plaintiffs filed a 

motion for preliminary approval of a proposed class action settlement as to defendants Intuit, 

Lucasfilm, and Pixar. No. 11-2509, ECF No. 501. On October 30, 2013, the Court preliminarily 

approved the proposed settlement with Intuit, Lucasfilm, and Pixar. No. 11-2509, ECF No. 540. 

The Court granted final approval as to that settlement on May 16, 2014. No. 11-2509, ECF No. 

915. The Court entered a final judgment with regards to Lucasfilm, Pixar, and Intuit on June 9, 

2014. No. 11-2509, ECF No. 936. At the request of Intuit, the Court entered an amended final 

judgment on June 20, 2014. No. 11-2509, ECF No. 947.

The remaining High-Tech defendants, Adobe, Apple, Google, and Intel, filed individual 

motions for summary judgment, and joint motions for summary judgment and to strike certain 

expert testimony on January 9, 2014. No. 11-2509, ECF Nos. 554 (Intel), 556–57 (joint motions), 

560 (Adobe), 561 (Apple), 564 (Google). The Court denied the High-Tech defendants’ individual 

motions for summary judgment on March 28, 2014. No. 11-2509, ECF No. 771. On April 4, 2014, 

the Court granted in part and denied in part the High-Tech defendants’ motion to strike, and 

denied the defendants’ joint motion for summary judgment. No. 11-2509, ECF No. 778.

On May 22, 2014, the High-Tech plaintiffs filed a motion for preliminary approval of class 

action settlement as to the remaining defendants. No. 11-2509, ECF No. 920. On August 8, 2014, 

the Court denied the High-Tech plaintiffs’ motion for preliminary approval, concluding that the 

proposed settlement did not fall “within the range of reasonableness.” No. 11-2509, ECF No. 974, 

at 30. On September 4, 2014, the High-Tech defendants filed a petition for a writ of mandamus 

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with the Ninth Circuit. No. 14-72745, ECF No. 1. On September 22, 2014, the Ninth Circuit found 

that the petition “raises issues that warrant a response,” and ordered briefing. No. 14-72745, ECF 

No. 2. On January 13, 2015, the High-Tech defendants filed correspondence with the Ninth Circuit 

referring to a new proposed settlement agreement. No. 14-72745, ECF No. 21. On January 30, 

2015, the defendants filed an unopposed motion to dismiss the petition, which the Ninth Circuit 

granted on February 2, 2015. No. 14-72745, ECF Nos. 23, 24. 

On January 15, 2015, the High-Tech plaintiffs filed a motion for preliminary approval of 

class action settlement as to the remaining defendants. No. 11-2509, ECF No. 1032. In this second 

proposed class action settlement, the parties had reached a settlement amount exceeding the 

previously rejected settlement by approximately $90.5 million dollars. Id. at 1. Following a 

fairness hearing on March 2, 2015, the Court granted preliminary approval to the January 2015 

settlement agreement on March 3, 2015. No. 11-2509, ECF Nos. 1051, 1054. A final approval 

hearing was held on July 9, 2015. Plaintiffs’ counsel completed filing supplemental briefing on 

attorney’s fees on July 24, 2015. No. 11-2509, ECF No. 1108.

2. Procedural Background in the Instant Action

Plaintiff Nitsch filed the first complaint against all Defendants but Blue Sky on September 

8, 2014. ECF No. 1. The Court related Nitsch’s action to In re High-Tech Employee Antitrust 

Litigation, No. 11-2509, on September 23, 2014. Plaintiff Cano filed the second complaint against 

all Defendants on September 17, 2014, which the Court related to High-Tech on October 7, 2014. 

See Case No. 14-4203, ECF Nos. 1, 9. Plaintiff Wentworth filed the third complaint against all 

Defendants but Blue Sky on October 2, 2014, which the Court related to High-Tech on October 

28, 2014. See Case No. 14-4422, ECF Nos. 1, 26. On November 5, 2014, the Court granted 

Plaintiffs’ motion to consolidate the above-mentioned three cases into a single action, In re 

Animation Workers Antitrust Litigation. See Case No. 14-4062, ECF No. 38. 

Pursuant to the Court’s case management order, Plaintiffs filed their first consolidated 

amended complaint (“CAC”) on December 2, 2014. ECF No. 63. On January 9, 2015, Defendants 

filed a joint motion to dismiss, and a request for judicial notice. ECF Nos. 75, 76. Defendants also 

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filed an administrative motion to seal exhibits in support of their motion to dismiss. ECF No. 79. 

Plaintiffs filed a timely opposition, ECF No. 97, and Defendants replied, ECF No. 100. On April 

3, 2015, the Court granted Defendants’ motion to dismiss. In re Animation Workers Antitrust 

Litig., --- F. Supp. 3d. ---, No. 14-4062, 2015 WL 1522368 (N.D. Cal. Apr. 3, 2015). The Court 

found that Plaintiffs’ claims were time barred under the statute of limitations, and that Plaintiffs 

had failed to adequately plead a “continuing violations” theory or a “fraudulent concealment” 

theory. See id. at *17. The dismissal was without prejudice, as the Court determined that Plaintiffs 

might be able to allege sufficient facts to support their continuing violations or fraudulent 

concealment theories. Id. 

On May 15, 2015, Plaintiffs filed their SAC. ECF No. 121. Six days later, Defendants filed 

the instant joint motion to dismiss the SAC. ECF No. 126. Defendants also filed a request for 

judicial notice. ECF No. 127.11 Plaintiffs filed a timely opposition, ECF No. 132, and Defendants 

replied, ECF No. 137. Defendant Blue Sky filed a motion to seal, ECF No. 124, as did the Sony 

Defendants, ECF No. 130. The Court addresses those sealing motions in a separate order. 

II. LEGAL STANDARD

A. Rule 12(b)(6) 

Under Federal Rule of Civil Procedure 12(b)(6), a party may move to dismiss a complaint 

for failure to state a claim upon which relief can be granted. Such a motion tests the legal 

sufficiency of a complaint. Navarro v. Block, 250 F.3d 729, 732 (9th Cir. 2001). In considering 

whether the complaint is sufficient, the Court must accept as true all of the factual allegations 

contained in the complaint. Iqbal, 556 U.S. at 678. However, the Court need not accept as true 

“allegations that contradict matters properly subject to judicial notice or by exhibit” or “allegations 

 

11 Defendants’ unopposed request for judicial notice is GRANTED, and the Court takes notice of 

the adjudicative facts contained therein. See ECF No. 127. Defendants request that the Court take 

judicial notice of documents incorporated by reference into the SAC (emails and deposition 

testimony quoted in SAC ¶¶ 137, 140), matters of public record (SEC filings, quoted in SAC ¶¶ 

161, 163), and newspaper articles (quoted in SAC ¶ 169). These documents are appropriate for 

judicial notice. See Knievel v. ESPN, 393 F.3d 1068, 1076 (9th Cir. 2005) (documents referenced 

in complaint but not physically attached); Lee, 250 F.3d at 689–90 (matters of public record); Von 

Saher, 592 F.3d at 960 (media publications); see also Fed. R. Evid. 201(d).

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that are merely conclusory, unwarranted deductions of fact, or unreasonable inferences.” In re 

Gilead Scis. Secs. Litig., 536 F.3d 1049, 1055 (9th Cir. 2008) (citation omitted). While a 

complaint need not allege detailed factual allegations, it “must contain sufficient factual matter, 

accepted as true, to ‘state a claim to relief that is plausible on its face.’” Iqbal, 556 U.S. at 678 

(quoting Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570 (2007)). “A claim has facial plausibility 

when the plaintiff pleads factual content that allows the court to draw the reasonable inference that 

the defendant is liable for the misconduct alleged. The plausibility standard is not akin to a 

‘probability requirement,’ but it asks for more than a sheer possibility that a defendant has acted 

unlawfully.” Iqbal, 556 U.S. at 678 (internal citation omitted). 

B. Rule 9(b) 

Claims sounding in fraud or mistake are subject to the heightened pleading requirements of 

Federal Rule of Civil Procedure 9(b), which require that a plaintiff alleging fraud “must state with 

particularity the circumstances constituting fraud.” Fed. R. Civ. P. 9(b); see Kearns v. Ford Motor 

Co., 567 F.3d 1120, 1124 (9th Cir. 2009). To satisfy the heightened standard under Rule 9(b), the 

allegations must be “specific enough to give defendants notice of the particular misconduct which 

is alleged to constitute the fraud charged so that they can defend against the charge and not just 

deny that they have done anything wrong.” Semegen v. Weidner, 780 F.2d 727, 731 (9th Cir. 

1985). Thus, claims sounding in fraud must allege “an account of the time, place, and specific 

content of the false representations as well as the identities of the parties to the 

misrepresentations.” Swartz v. KPMG LLP, 476 F.3d 756, 764 (9th Cir. 2007) (per curiam) 

(internal quotation marks and citation omitted). A plaintiff must set forth what is false or 

misleading about a statement, and why it is false.” In re GlenFed, Inc. Secs. Litig., 42 F.3d 1541, 

1548 (9th Cir. 1994) (en banc), superseded by statute on other grounds as stated in Marksman 

Partners, L.P. v. Chantal Pharm. Corp., 927 F. Supp. 1297, 1309 (C.D. Cal. 1996). However, 

“intent, knowledge, and other conditions of a person’s mind” need not be stated with particularity, 

and “may be alleged generally.” Fed. R. Civ. P. 9(b).

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III.DISCUSSION

Defendants move to dismiss Plaintiffs’ SAC on the following grounds: that (1) Plaintiffs’ 

claims are barred under the relevant statutes of limitations; (2) Plaintiffs fail to state plausible 

claims against Defendants Blue Sky or Sony Pictures; and (3) Plaintiffs fail to sufficiently allege a 

per se antitrust claim based on wage-fixing agreements. The Court begins by addressing whether 

Plaintiffs’ claims are time barred. 

A. Fraudulent Concealment

The Court previously concluded that Plaintiffs’ claims are time barred under the relevant 

statutes of limitations unless Plaintiffs adequately allege either a continuing violations theory or a 

fraudulent concealment theory. In re Animation Workers Antitrust Litig., 2015 WL 1522368, at 

*17. In their SAC, Plaintiffs have abandoned their continuing violations theory, and the parties 

agree that absent a showing of fraudulent concealment, Plaintiffs’ claims are time-barred. For the 

reasons discussed below, the Court finds that Plaintiffs have adequately pled fraudulent 

concealment and the statute of limitations may be tolled.

The purpose of the fraudulent concealment doctrine is to prevent a defendant from 

“concealing a fraud . . . until such a time as the party committing the fraud could plead the statute 

of limitations to protect it.” Bailey v. Glover, 88 U.S. (21 Wall.) 342, 349 (1874). Thus, “[a]

statute of limitations may be tolled if the defendant fraudulently concealed the existence of a cause 

of action in such a way that the plaintiff, acting as a reasonable person, did not know of its 

existence.” Hexcel Corp. v. Ienos Polymers, Inc., 681 F.3d 1055, 1060 (9th Cir. 2012). The 

plaintiff bears the burden of pleading and proving fraudulent concealment. Id.; see also Conmar

Corp. v. Mitsui & Co. (U.S.A.), Inc., 858 F.2d 499, 502 (9th Cir. 1988). To plead fraudulent 

concealment, the plaintiff must allege that: (1) the defendant took affirmative acts to mislead the 

plaintiff; (2) the plaintiff did not have “actual or constructive knowledge of the facts giving rise to 

its claim”; and (3) the plaintiff acted diligently in trying to uncover the facts giving rise to its 

claim. Hexcel, 681 F.3d at 1060; see also Conmar, 858 F.2d at 502; Beneficial Standard Life 

Insurance Co. v. Madariaga, 851 F.2d 271, 276 (9th Cir. 1988). 

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Moreover, allegations of fraudulent concealment must be pled with particularity. Conmar, 

858 F.2d at 502. However, “it is generally inappropriate to resolve the fact-intensive allegations of 

fraudulent concealment at the motion to dismiss stage, particularly when the proof relating to the 

extent of the fraudulent concealment is alleged to be largely in the hands of the alleged 

conspirators.” In re Rubber Chemicals Antitrust Litig., 504 F. Supp. 2d 777, 789 (N.D. Cal. 2007).

1. Affirmative acts to mislead

a. The Court’s April 3, 2015 order

Before turning to the substance of Defendants’ motion to dismiss for failure to sufficiently

plead fraudulent concealment, the Court briefly summarizes its April 3, 2015 order granting 

Defendants’ motion to dismiss Plaintiffs’ CAC. See In re Animation Workers Antitrust Litig., No. 

14-CV-04062-LHK, 2015 WL 1522368, at *15 (N.D. Cal. Apr. 3, 2015). The Court granted 

Defendants’ motion to dismiss, finding that Plaintiffs failed to plead any facts showing affirmative 

acts of concealment. Id. More specifically, the Court found that Plaintiffs’ conclusory allegations 

that Defendants engaged in a “secret conspiracy” and that “Defendants’ conspiracy was 

concealed” were insufficient as a matter of law. Id. at *16. 

In addition to their allegations with respect to Defendants’ alleged secret conspiracy, 

Plaintiffs also argued that Defendants took affirmative steps to mislead Plaintiffs as to the 

existence of Plaintiffs’ claims through the Croner survey. The Court rejected Plaintiffs’ argument 

and found that there were no allegations in the CAC “that the compensation information in the 

Croner survey was publicly accessible, that Defendants were responsible for publishing the Croner 

survey, or that Defendants publicized the Croner survey as ‘affirming their compliance with 

applicable antitrust laws . . . .’” Id. (citing In re Lithium Ion Batteries Antitrust Litig., No. 13-MD2420, 2014 WL 309192, at *16 (N.D. Cal. Jan. 21, 2014)). The Court also found that the bare 

allegation that Defendants provided “pretextual, incomplete or materially false and misleading 

explanations for hiring, recruiting and compensation decisions” was conclusory and insufficient to 

state a claim under Rule 9(b), as Plaintiffs failed to offer “specific facts showing the ‘who, what, 

where, when’ of [the] alleged incomplete or materially false statements.” In re Animation Workers 

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Antitrust Litig., 2015 WL 1522368, at *16 (citing Swartz, 476 F.3d at 764). 

The Court noted, however, that “the combination of . . . misleading, pretextual statements 

and . . . affirmative efforts taken to . . . otherwise keep the conspirac[y] secret” could support a 

fraudulent concealment claim if such pretextual statements were pled with particularity and if the 

alleged affirmative acts to conceal went beyond mere “passive concealment.” In re Animation 

Workers Antitrust Litig., 2015 WL 1522368, at *16 (citing Lithium Ion, 2014 WL 309192 at *16; 

In re TFT-LCD (Flat Panel) Antitrust Litig., 586 F. Supp. 2d 1109, 1119 (N.D. Cal. 2008) (finding 

sufficient allegations of pretextual explanations for price increase and affirmative efforts to ensure 

secrecy of conspiracy); In re Cathode Ray Tube (CRT) Antitrust Litig., 738 F. Supp. 2d 1101, 

1024–25 (N.D. Cal. 2010) (same)). However, as initially pled in the CAC, Plaintiffs’ allegations 

were either insufficient to meet the particularity requirement or merely constituted “passive 

concealment.” In re Animation Workers Antitrust Litig., 2015 WL 1522368, at *16. The Court 

further concluded that amendment would not necessarily be futile, and granted Plaintiffs leave to 

amend their complaint. 

The Court now turns to whether Plaintiffs’ amended allegations with respect to 

Defendants’ alleged fraudulent concealment are sufficient to state a plausible claim.

b. Plaintiffs’ claims in the SAC

Defendants contend that even if the new factual allegations in the SAC are taken as true, 

Plaintiffs have not established a plausible claim for fraudulent concealment because (1) Plaintiffs’ 

allegations that the alleged conspiracy was secret do not establish affirmatively misleading 

conduct; (2) Plaintiffs fail to identify any instance where Defendants made specific and 

affirmatively false or misleading statements to conceal the conspiracy; (3) Pixar’s and Lucasfilm’s 

conduct in defense of the High-Tech litigation does not constitute affirmative acts of concealment;

and (4) Plaintiffs have failed to allege that they diligently investigated their claims after Plaintiffs

were put on notice of their claims. Mot. 4–17. The Court turns to these arguments below.

c. Legal standard for “affirmative acts”

Before the Court evaluates the legal sufficiency of Plaintiffs’ factual allegations, the Court 

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begins by addressing the parties’ dispute with respect to what standard for “affirmatively 

misleading conduct” Plaintiffs’ allegations must meet. In the Court’s April 3, 2015 order granting 

Defendants’ motion to dismiss, the Court concluded that Plaintiffs “faile[d] to show affirmatively 

misleading conduct ‘above and beyond’ the alleged conspiracy itself.” In re Animation Workers 

Antitrust Litig., 2015 WL 1522368, at *15 (quoting Guerrero v. Gates, 442 F.3d 697, 706–07 (9th 

Cir. 2003)). Relying on the Ninth Circuit’s decisions in Guerrero and Conmar, the Court 

explained that “the fact that a defendant’s acts are ‘by nature self-concealing’ is insufficient to 

show that the defendant has affirmatively misled the plaintiff as to the existence of the plaintiff’s 

claim.’” In re Animation Workers Antitrust Litig., 2015 WL 1522368, at *15 (quoting Conmar, 

858 F.2d at 505). The Court found that Plaintiffs must allege that “Defendants took affirmative

steps to mislead Plaintiffs” and concluded that “Plaintiffs fail[ed] to allege facts showing that 

Defendants did more than passively conceal information.” Id.

The Court begins by addressing the parties’ apparent confusion and disagreement with 

respect to the relationship between the “above and beyond” language used in Guerrero and what 

type of fraudulent conduct is necessary for a fraudulent concealment claim in the Ninth Circuit. 

More specifically, the parties dispute whether Plaintiffs must allege acts of concealment that are 

“separate and apart” from the wrongful conspiracy itself. As the Fourth Circuit explained in 

Supermarket of Marlinton, Inc. v. Meadow Gold Dairies, Inc., 71 F.3d 119, 122 (4th Cir. 1995), 

the circuits have adopted three standards for what acts satisfy the requirement that a defendant has

“fraudulently concealed the facts that are the basis of the plaintiff’s claim”: the (1) “selfconcealing” standard; (2) the “separate and apart” standard; and (3) the “affirmative acts” 

standard. 

Under the most lenient standard, the “affirmatively misleading conduct” element is 

satisfied so long as the plaintiff pleads a “self-concealing” antitrust violation. Thus, the mere 

existence of a secret conspiracy is enough to prove fraudulent concealment. Id. at 122 (citing New 

York v. Hendrickson Bros., Inc., 840 F.2d 1065 (2d Cir. 1988), cert. denied, 488 U.S. 848 (1988)). 

In contrast, under the “separate and apart” standard, the most demanding standard, a plaintiff must 

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plead affirmative acts of concealment separate from acts of concealment inherent in the conspiracy 

itself. Id. (citing Colorado v. W. Paving Constr. Co., 630 F. Supp. 206, 210 (D. Colo. 1986)

(noting that the affirmative acts alleged by the plaintiffs “are the acts taken in carrying out the 

conspiracy itself” and that “[f]raudulent concealment occurs when a defendant takes affirmative 

steps in addition to the original wrongdoing”), aff’d en banc by an equally divided court, 841 F.2d 

1025 (10th Cir.), cert. denied, 488 U.S. 870 (1988)). Finally, under the intermediate “affirmative 

acts” standard, a plaintiff must show that the defendant affirmatively acted to conceal the 

conspiracy, but the proof may include acts of concealment that were in furtherance of the

conspiracy itself. Id. (citing Texas v. Allan Construction Co., 851 F.2d 1526, 1532 (5th Cir. 

1988)).

There is no dispute that the “self-concealing” standard is not the law of this circuit. In 

Conmar, the Ninth Circuit explicitly held that fraudulent concealment “require[s] more” than acts 

that “by nature [are] self-concealing.” Conmar, 858 F.2d at 505; see also Volk, 816 F.2d at 1416 

(“[S]ilence or passive conduct does not constitute fraudulent concealment.”). As evidenced by the 

parties’ dispute, however, it is less evident whether the Ninth Circuit requires a plaintiff to allege 

acts of concealment that are wholly separate and independent from the underlying conspiracy 

itself. Adding to the complexity is the fact that, as the leading treatise on antitrust law concludes, 

“the line between active and passive concealment is very fine indeed.” P. Areeda and H. 

Hovencamp, Antitrust Law ¶ 320e. The Court further acknowledges that the “above and beyond” 

language in Guerrero has engendered some confusion between the parties. However, as discussed 

below, the Ninth Circuit’s application of the fraudulent concealment doctrine supports the 

conclusion that a plaintiff in this circuit must allege “affirmative” acts or “affirmatively 

misleading conduct” to conceal, but those acts do not need to be “separate and apart” from the 

underlying conspiracy itself. 

In Conmar, for example, the Ninth Circuit held that “affirmative conduct” which was 

integral to the underlying conspiracy itself could support a fraudulent concealment claim. See 

Conmar, 858 F.2d 499–501. More specifically, the plaintiff, Conmar, brought an antitrust action 

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against Mitsui, a foreign supplier of PC-strand steel, alleging that Mitsui imported PC-strand steel 

at below-market prices, (i.e., “dumping”), in conspiracy with Conmar’s competitors. “Dumping” 

steel products allowed Conmar’s competitors to obtain PC-strand steel from Mitsui at illegally low 

prices, suppressing competition. Id. Mitsui was able to import PC-strand steel at below-market 

prices “in part by using false customs reports” that “split[] . . . the difference between nominal 

and actual exchange rates.” Id. at 500. In support of its fraudulent concealment claim, Conmar 

alleged that “Mitsui affirmatively acted to conceal its anticompetitive behavior by creating 

customs and other documents false reporting prices for PC-strand.” Id. at 505. The Ninth Circuit 

held that a jury could conclude that the “the filing of false customs forms was affirmative conduct

sufficient for a finding of fraudulent concealment.” Id.

Indeed, the Fourth Circuit in Meadow Gold Dairies cited Conmar for the proposition that 

“affirmative acts in furtherance of a conspiracy provide sufficient evidence of fraudulent 

concealment to establish the first element of the fraudulent concealment test.” Meadow Gold 

Dairies, 71 F.3d at 125–26. Similarly, in E.W. French & Sons, Inc. v. General Portland Inc., 885 

F.2d 1392 (9th Cir. 1989), the Ninth Circuit found that acts part and parcel of the underlying 

conspiracy could support a finding of fraudulent concealment. In E.W. French, the plaintiff 

alleged antitrust violations in the form of an illegal price fixing conspiracy, in which the defendant 

allegedly provided secret discounts and lower prices to certain co-conspirators. E.W. French, 885 

F.2d at 1394–95. In addition to alleging that the defendant had flatly denied any wrongdoing, the 

plaintiff also alleged that the defendant’s use of “plain white envelopes” to mail discount and price 

information to co-conspirators was an affirmative act of fraudulent concealment. Id. at 1399. The 

Ninth Circuit agreed, and held that a reasonable jury could conclude that the use of “plain white 

envelopes” to communicate anti-competitive prices and discounts, in combination with the 

defendant’s denial of wrongful conduct, could establish fraudulent concealment. Id. at 1399.

In both Conmar and E.W. French, the Ninth Circuit held that a defendant’s acts which 

were in furtherance of the underlying conspiracy could be sufficient to show fraudulent 

concealment. These cases cannot be reconciled with the “separate and apart” standard, which 

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requires that a plaintiff allege fraudulent conduct that is extrinsic of the underlying conspiracy 

itself. See Meadow Gold Dairies, 71 F.3d at 125–26. The Ninth Circuit and other courts in this 

District have consistently required only that a plaintiff allege “affirmative acts” of concealment. 

These acts must be “affirmative steps to mislead” that are more than mere “passive[] 

conceal[ment].” Volk, 816 F.2d at 1415–16. That does not, however, impose the heightened 

requirement that a plaintiff allege fraudulent conduct that is independent of the underlying 

conspiracy, or that the affirmative conduct be “separate and apart” from acts in furtherance of the 

underlying conspiracy. See, e.g., Lithium Ion, 2014 WL 309192, at *16 (efforts by the defendants 

to keep conspiracy secret, such as instructing destruction of emails after reading, instructing 

personnel to refrain from memorializing conversations, and using code names were relevant to the 

fraudulent concealment question); TFT-LCD, 586 F. Supp. 2d at 1119, 1132 (defendants’ use of 

pretextual explanations for price increases and agreement not to publicly disclose the nature of the 

conspiracy could establish fraudulent concealment).

Moreover, the Court notes that such an interpretation of existing Ninth Circuit case law is 

in accord with the majority of the circuits, which have adopted either the “self-concealing” 

standard, or the intermediate “affirmative acts” standard. See New York v. Hendrickson Bros., Inc., 

840 F.2d 1065, 1084–85 (2d Cir. 1988) (“[T]he State sufficiently proved the concealment by the 

defendants of the conspiracies . . . both because the bid-rigging was self-concealing and because 

the . . . defendants’ affirmative acts of concealment were properly admissible against all of the 

defendants.”); Marlington, 71 F.3d at 126 (“Those acts, however, need not be separate and apart 

from the acts of concealment involved in the antitrust violation; rather, [plaintiff’s] proof may 

include acts of concealment involved in the alleged antitrust violation itself.”); Texas v. Allan 

Const. Co., 851 F.2d 1526, 1541 (5th Cir. 1988) (“Refusing to allow affirmative acts that further a 

conspiracy to support a finding of fraudulent concealment rests upon a view . . . that we find 

unacceptable.”); Pinney Dock and Transport Co. v. Penn Central Corp., 838 F.2d 1445, 1472 (6th 

Cir. 1988) (“[A]ffirmative acts may be found by the trier of fact to constitute both wrongful 

concealment of the alleged conspiracy in violation of the antitrust laws and acts in furtherance of 

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the conspiracy.”); Baker v. F & F Inv., 420 F.2d 1191, 1199 (7th Cir. 1970) (“Where, as in the 

case of many conspiracies in violation of federal antitrust laws, the wrong is self-concealing, little 

need be added in order to justify tolling the statute.”); Hill v. Texaco, Inc., 825 F.2d 333, 335 n.2 

(11th Cir. 1987) (holding that fraudulent concealment may be shown if “the wrong is of such a 

character as to be self-concealing.”).

Defendants rely on the “above and beyond” language in Guerrero, which this Court cited 

in its April 3, 2015 order, in support of their argument that fraudulent concealment requires 

conduct that is “separate and apart” from the underlying conspiracy. In Guerrero, the Ninth 

Circuit held that fraudulent concealment “halts the statute of limitations when there is ‘active 

conduct by a defendant, above and beyond the wrongdoing upon which the plaintiff’s claim is 

filed, to prevent the plaintiff from suing in time.’” Guerrero, 442 F.3d at 706 (quoting Santa 

Maria v. Pac. Bell, 202 F.3d 1170, 1176 (9th Cir. 2000)). As discussed above, the Court concludes 

that the Ninth Circuit has consistently held in antitrust actions that allegations of affirmative acts 

of concealment, even if in furtherance of the conspiracy, may be sufficient to support a fraudulent 

concealment claim. To the extent there may be any ambiguity as to whether the “above and 

beyond” language in Guerrero requires a plaintiff to allege fraudulent acts that are “separate and 

apart” from the underlying conspiracy itself, the Court finds that the Ninth Circuit, at least in 

antitrust actions,12 has required only “affirmative acts” of concealment. Reading Guerrero against 

the Ninth Circuit’s decisions in Conmar, E.W. French, and Volk, the Court concludes that these 

cases stand for the proposition that a plaintiff must allege active, affirmative acts of fraudulent 

concealment that entail more than passive silence, but those affirmative acts may be intertwined 

with the underlying antitrust conspiracy.13

 

12 Defendants contend that the Ninth Circuit has not explicitly held that the standard for fraudulent 

concealment differs in antitrust actions. While that may be the case, the Court is not persuaded that 

Guerrero abrogated the long line of Ninth Circuit authority finding that affirmatively misleading 

acts that were also in furtherance of the conspiracy could establish fraudulent concealment. 

13 While not relevant here, the Court does note that silence may be sufficient to show fraudulent 

concealment where there is an affirmative duty to disclose, e.g., a fiduciary duty. Conmar, 858 

F.2d at 505 (“Passive concealment of information is not enough to toll the statute of limitations, 

unless the defendant had a fiduciary duty to disclose information to the plaintiff.”) (internal 

citation omitted).

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Accordingly, the Court rejects Plaintiffs’ “invitation” to reconsider the Court’s previous 

finding that Plaintiffs failed to sufficiently plead “affirmative acts” of misconduct. In its April 3, 

2015 order, the Court relied on Guerrero, Conmar, and Volk to conclude that Plaintiffs’ 

conclusory allegations with respect to Defendants’ “secret conspiracy,” were insufficient to show 

more than mere passive concealment. See In re Animation Workers Litig., 2015 WL 1522368, at 

*15–16. Plaintiffs’ bare allegations in their CAC consisted of claims that Defendants engaged in a 

“secret conspiracy” or that “Defendants’ conspiracy was concealed.” As the Court previously 

concluded, under Ninth Circuit precedent, allegations that a “secret conspiracy” existed are 

insufficient to show “affirmative acts” of concealment. Id. (citing Conmar, 858 F.2d at 505). The 

Court therefore denies Plaintiffs’ request to “reconsider” its April 3, 2015 order. 

The Court therefore turns to whether Plaintiffs have now sufficiently alleged facts in their

SAC showing “affirmative acts” of concealment. 

d. Plaintiffs have pled sufficient facts to satisfy the “affirmative acts” requirement

With the above principles in mind, the Court finds that Plaintiffs’ allegations, taken as a 

whole, have stated a plausible claim that Defendants took “affirmative acts” to mislead the 

Plaintiffs. The Court notes that Defendants Sony and Blue Sky have raised specific challenges to 

the sufficiency of Plaintiffs’ allegations of fraudulent concealment as to those Defendants, and the 

Court addresses those arguments in Part B. Setting aside Defendants Sony and Blue Sky’s separate 

arguments for the moment, the Court concludes that Plaintiffs have adequately pled the first 

element of a fraudulent concealment claim for the reasons discussed below. 

Here, the Court finds that Plaintiffs’ allegations of pretextual statements regarding 

compensation, in combination with Plaintiffs’ allegations that Defendants actively concealed and 

ensured the secrecy of the conspiracy, are sufficient to allege “affirmative acts.” See In re 

Animation Workers Litig., 2015 WL 1522368, at *16 (citing In re Lithium Ion Batteries Antitrust 

Litigation, No. 13-MD-2420, 2014 WL 309192, at *16 (N.D. Cal. Jan. 21, 2014); In re TFT-LCD 

(Flat Panel) Antitrust Litig., 586 F. Supp. 2d 1109, 1119 (N.D. Cal. 2008) (pretextual explanations 

for the inflated prices of LCDs and efforts to ensure secrecy were affirmative acts of 

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concealment); In re Cathode Ray Tube (CRT) Antitrust Litig., 738 F. Supp. 2d 1011, 1024–25 

(N.D. Cal. 2010) (same ). In Lithium Ion, for example, the plaintiffs alleged both that the 

defendants had made “public, putatively false statements . . . affirming their compliance with 

applicable antitrust laws, as well as the existence of vigorous price competition in the . . . market,” 

on which plaintiffs could have reasonably relied, and that the defendants had taken affirmative 

steps to destroy evidence of the conspirators’ secret meetings, avoided memorializing 

conversations, and used secret codes to refer to coconspirators and topics. Lithium Ion, 2014 WL 

309192, at *16. As this Court previously noted, “[i]t was the combination of those misleading, 

pretextual statements and the affirmative efforts taken to destroy evidence of the conspiracy or 

otherwise keep the conspiracies secret that supported the respective plaintiffs’ fraudulent 

concealment allegations.” In re Animation Workers Litig., 2015 WL 1522368, at *16

In the instant case, the Court finds that Plaintiffs have sufficiently alleged that Defendants 

both made misleading, pretextual statements and took affirmative steps to keep the alleged 

conspiracy a secret. Plaintiffs allege that Defendants both made general statements regarding the 

reasons for certain salary raises and ranges that belied the true reason for compensation decisions, 

i.e., the alleged conspiracy, and that Defendants made specific misleading statements to individual 

putative class members. For instance, Pixar’s Ed Catmull sent an email to Pixar employees 

suggesting that “one of the main reasons” for the modest 3.5% raise in 2007 was to “fund 

additional benefit programs.” SAC ¶ 149. According to Plaintiffs, such a statement could be 

misleading, because Plaintiffs contend that the actual reason salary increases were modest was the 

illegal conspiracy. Similarly, Pixar allegedly instructed its managers to inform employees that 

salaries were set based on performance, skills, and proficiency, without any mention of collusive 

salary range setting. Id. ¶ 148. In addition to these more generalized statements, Plaintiffs identify 

specific communications from Defendants to putative class members describing compensation as 

“competitive,” and explaining that compensation was determined on “employee equity . . . skill 

set[,] and experience,” without any mention of the alleged conspiracy. Id. ¶ 150 (quoting emails 

from Pixar’s McAdams and ILM’s Beck). 

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Taking these allegations as true, which the Court must on a motion to dismiss, the Court 

concludes that Plaintiffs have adequately alleged that Defendants provided pretextual explanations 

for Plaintiffs’ allegedly suppressed compensation. Attributing the anti-competitive effects of a 

conspiracy to some cause other than the collusive conduct can be an affirmative act of fraudulent 

concealment. See E.W. French, 885 F.2d at 1399 (finding affirmative acts where defendant

attributed price uniformity to competition, rather than collusion). Moreover, as this Court 

explained in its April 3, 2015 order, other courts in this District have consistently found that 

pretextual explanations for how or why certain anti-competitive effects are occurring can satisfy 

the “affirmative acts” requirement. 

For instance, in Cathode Ray, the court found that the defendant acted affirmatively when 

it attributed “stubbornly” high prices to a shortage of critical input components. 738 F. Supp. 2d at 

1024. Similarly, in TFT-LCD, the court found that the defendants’ pretextual explanations for the 

inflated prices of LCDs, such as undercapitalization and undersupply, were affirmative acts of 

concealment under the first element of the fraudulent concealment standard. 586 F. Supp. 2d at 

1119. Likewise, in Lithium Ion, the court found that the defendants’ “public, putatively false 

statements . . . affirming their compliance with applicable antitrust laws, as well as the existence of 

vigorous price competition in the . . . market,” in combination with efforts to maintain the secrecy 

of the conspiracy, could support a fraudulent concealment claim. Lithium Ion, 2014 WL 309192, 

at *16. Here, as in Cathode Ray, TFT-LCD, and Lithium Ion, Plaintiffs have identified instances 

where Defendants allegedly provided explanations for why compensation levels were set at certain 

levels that belied the actual reason for suppressed compensation, i.e., Defendants’ alleged 

conspiracy. 

In addition to these new specific factual allegations with respect to Defendants’ allegedly 

misleading, pretextual explanations for compensation levels, the Court further notes that Plaintiffs 

have made more detailed allegations with respect to Defendants’ affirmative attempts to maintain 

the secrecy of the conspiracy. Unlike Plaintiffs’ bare allegations of the existence of a “secret 

conspiracy” in Plaintiffs’ CAC, see CAC ¶ 126, Plaintiffs have now put forth specific factual 

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allegations concerning Defendants’ affirmative efforts to keep the conspiracy secret. Plaintiffs 

allege, and support with specific factual allegations, that Defendants actively attempted to conceal 

the existence of the conspiracy. See generally SAC ¶¶ 135–182. For example, “[i]n lieu of emails, 

[Pixar’s] McAdams opted for in-person meetings,” including a dinner she held with a Lucasfilm 

executive where she planned to “ask her about her merit increase budget for 2009.” SAC ¶ 143. 

Similarly, Plaintiffs cite the deposition testimony of Sharon Coker, the former ILM Senior 

Director Human Resources and Director of Human Resources at the Walt Disney Company and 

ImageMovers, where Coker explained that the non-solicitation agreement “was termed a 

‘gentleman’s agreement’ . . . because it was not written down.” Id. ¶ 139. Plaintiffs also contend 

that Lucasfilm made “affirmative efforts to eliminate a paper trail regarding its code-named 

‘DNR’ agreements,” including a requirement that “all discussions of ‘DNR’ needed to be 

conducted over the phone . . . [i]f you see an email forward to Steve and one of our lawyers.” Id. ¶ 

138.

These factual allegations raise the reasonable inference that Defendants took affirmative 

steps to conceal the details of their conspiracy by intentionally choosing to meet in-person or over 

the telephone, rather than risk memorializing details about the alleged conspiracy. 14 See, e.g., In re 

Capacitors Antitrust Litig., No. 14-cv-03264-JD, 2015 WL 3398199, at *7 (N.D. Cal., May 26, 

2015) (finding allegations that the defendants “generally agreed not to discuss public nature of the 

scheme,” “did not take or distribute official minutes or record the meetings,” and instructed 

 

14 The Court further notes that Plaintiffs have alleged a variety of other actions that Plaintiffs 

contend evince affirmative acts to conceal on the part of Defendants. As discussed in the factual 

background, Plaintiffs aver that Defendants would use personal emails instead of company emails 

to communicate about the conspiracy, published codes of conduct or documents that 

“misrepresented the truth about the conspiracy,” filed misleading SEC documents, and took active 

steps to conceal the breadth and scope of the conspiracy during the High-Tech litigation. See SAC 

¶¶ 140, 151–163, 171–182. Defendants contest the truth of some of these allegations, and also 

dispute whether any alleged action or conduct could individually and independently be considered 

misleading or fraudulent. See Mot. at 8–16. 

However, on a motion to dismiss the Court accepts as true Plaintiffs’ factual allegations 

and makes all reasonable inferences in favor of Plaintiffs. See Knevelbaard Dairies v. Kraft 

Foods, Inc., 232 F.3d 979, 984 (9th Cir. 2000) (In ruling on a motion to dismiss, “the court must 

presume all factual allegations of the complaint to be true and draw all reasonable inferences in 

favor of the nonmoving party.”) (citation omitted).

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employees to delete emails were sufficient to support the allegation of fraudulent concealment). 

These allegations also support Plaintiffs’ claim that Defendants actively took measures to ensure 

the secrecy of the conspiracy. While Defendants dispute Plaintiffs’ characterizations and 

interpretations of these factual allegations, and while Plaintiffs may not ultimately prevail in 

proving that their allegations are true, the Court accepts as true Plaintiffs’ factual allegations at the 

motion to dismiss stage. See Knevelbaard, 232 F.3d at 984. At this stage of the proceedings, 

Plaintiffs need only allege sufficient facts to state a plausible claim, not prove the veracity of their 

allegations. See id.

Defendants argue that Plaintiffs have not shown that these alleged pretextual statements

were made “for the purpose of misleading plaintiffs ‘or to keep the plaintiff unaware.’” Mot. 8 

(citing Hexcel, 681 F.3d at 1060). However, Defendants cite no Ninth Circuit authority, or any 

authority for that matter, that requires Plaintiffs to show that Defendants’ affirmative acts were for 

the purpose of misleading Plaintiffs. To the contrary, one court in this circuit has specifically held 

that “[t]he proper focus . . . is not whether the intent was to conceal the information from 

plaintiffs, but whether the ‘concealment . . . prevented [plaintiff] from being alerted.” In re

Coordinated Pretrial Proceedings in Petroleum Prods. Antitrust Litig., 782 F. Supp. 487, 490 

(C.D. Cal. 1991) (citing Conmar, 858 F.2d at 502). While it may be the case that Plaintiffs will 

ultimately have to prove the fact that Defendants’ alleged affirmative conduct “prevented 

[Plaintiffs] from being alerted to the” suppression of Plaintiffs’ compensation, that does not 

require that Plaintiffs prove that Defendants had the subjective intent of concealing the alleged 

conspiracy. Conmar, 858 F.2d at 505. 

Indeed, Defendants rely on this “purpose” argument in support of their contention that 

Plaintiffs have failed to allege more than mere passive concealment. However, for the reasons 

discussed above, the Court concludes that Plaintiffs have alleged more than a mere failure to 

disclose the existence of a conspiracy. As Plaintiffs argue, taking steps to ensure that a conspiracy 

remains secret is qualitatively different from failing to disclose a secret conspiracy. See, e.g., In re 

Capacitors Antitrust Litig., 2015 WL 3398199, at *7. At bottom, while Defendants characterize 

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their arguments as concerning the sufficiency of Plaintiffs’ allegations, the Court finds that

Defendants’ arguments go to the truth of Plaintiffs’ claims. As discussed above, the Court 

previously granted Defendants’ motion to dismiss because Plaintiffs’ “factual” allegations were 

comprised of conclusory allegations that “Defendants provided pretextual, incomplete or 

materially false and misleading explanations for hiring, recruiting and compensation decisions 

made pursuant to the conspiracy,” and that “Defendants engaged in a secret conspiracy.” See CAC

¶¶ 126, 130. In Plaintiffs’ SAC, however, Plaintiffs have made specific factual allegations with 

“an account of the time, place, and specific content of the false representations as well as the 

identities of the parties to the misrepresentations.” Swartz, 476 F.3d at 764. These factual 

allegations, taken as true, are sufficient to support a plausible claim of fraudulent concealment. 

Defendants also contend that Plaintiffs cannot show that any of Plaintiffs’ alleged 

pretextual statements were “putatively false.” Mot. at 11. For instance, according to Defendants, 

Plaintiffs “do not and cannot allege that Pixar was being deceptive” by explaining that the child 

care center was “one of the main reasons” for the modest salary raises. Reply at 9. Instead, “what 

[P]laintiffs are really arguing is that Pixar should have disclosed, in addition to the child care 

center, the purported conspiracy.” Id. Mere failure to disclose the alleged conspiracy, Defendants 

contend, cannot constitute “affirmative” conduct. Id. Defendants are correct that silence or mere 

passive concealment cannot constitute affirmatively misleading conduct. However, Plaintiffs 

assert that Pixar’s identification of the child-care center as “one of the main reasons” for modest 

salary increases in 2007 without disclosing that the conspiracy was allegedly the real reason for 

the modest increases constitutes more than mere silence and passive concealment. For the 

purposes of deciding a motion to dismiss, the Court finds this allegation sufficient. The alleged

pretextual explanation for the modest salary increases could plausibly be interpreted as a 

misleading partial disclosure designed to evade the suspicions of the Plaintiffs. See ,e.g., Cathode 

Ray., 738 F. Supp. 2d at 1024–25 (allegation that defendants provided pretextual explanations for 

price increases sufficient). Such evasion or attempt to mislead is neither silence nor passive 

concealment. 

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Furthermore, a statement need not be “putatively false” to mislead. Defendants, 

unsurprisingly, cite no authority for this proposition as Rule 9(b) merely requires that Plaintiffs 

plead “false or misleading” statements. GlenFed, 42 F.3d at 1548 (emphasis added). For instance, 

in Lithium Ion, the defendants “used the cobalt price increase as a pretext for an unwarranted price 

increase on their own products.” Lithium Ion, 2014 WL 309192, at *4. While there was, in fact, an 

increase in cobalt prices at that time, the defendants’ pretextual excuse for increasing prices 

prevented plaintiffs from discovering the true reason for the unwarranted price increases: 

defendants’ alleged illegal conspiracy. Id. at *4, 16. As in Lithium Ion, it may be the case that

Defendant Pixar’s explanation for its “modest” salary increases was not “putatively” false, but 

Plaintiffs have plausibly pled that Pixar’s explanation was misleading because it deflected 

attention from the allegedly anticompetitive conspiracy.

Defendants also contend that Plaintiffs have failed to allege that any pretextual statements 

“were the product of any concerted activity between or among defendants for the purpose of 

concealing the alleged conspiracy.” Mot. at 9 (citing Cathode Ray, 738 F. Supp. 2d at 1025). As 

Plaintiffs note, however, “Defendants’ attempt to convert the fraudulent concealment doctrine into 

a conspiracy-to-fraudulently-conceal doctrine is wholly unsupported.” Opp. at 8. It is true that the

Cathode Ray court found that the plaintiffs’ allegations that the defendants agreed, as part of pricefixing conspiracy, “‘not to discuss publicly, or otherwise reveal, the nature and substance’ of their 

dealings . . . . and to give ‘false and pretextual reasons for . . . price increases,” were sufficient to 

plead fraudulent concealment. In re Cathode Ray, 738 F. Supp. 2d at 1025. The Cathode Ray court 

did not, however, hold that such agreement was a necessary predicate to finding that the 

defendants had taken affirmative acts to fraudulently conceal their conspiracy. See id. Defendants’ 

identification of a case where certain factual allegations were found sufficient to plead fraudulent 

concealment does not support Defendants’ assertion that such allegations are necessary to plead 

fraudulent concealment. Here, for the reasons discussed above, Plaintiffs have sufficiently alleged 

that Defendants conspired to suppress compensation through their anti-solicitation and 

compensation setting agreements, and that Defendants took affirmative steps to fraudulently 

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conceal the alleged conspiracy. The Court declines to impose the novel requirement that any 

fraudulent concealment also have been an explicit, separate, and agreed-to term of the conspiracy. 

In sum, the Court finds that Plaintiffs have sufficiently alleged, with particularity, 

“affirmative acts” of concealment. While Plaintiffs may not ultimately prevail on these claims, and 

while Defendants vigorously contest Plaintiffs’ inferences and characterizations of certain factual 

allegations, the Court concludes that Plaintiffs have “ple[d] factual content that allows the court to 

draw the reasonable inference that the defendant[s are] liable for the misconduct alleged.” Iqbal, 

556 U.S. at 678. At the motion to dismiss stage, Plaintiffs are not required to do more.

2. Actual or constructive knowledge and due diligence

In addition to pleading affirmative conduct, the first element of the fraudulent concealment 

claim, Plaintiffs must also allege the second and third elements of a fraudulent concealment claim:

that Plaintiffs did not have “actual or constructive knowledge of the facts giving rise to its claim”; 

and that Plaintiffs acted diligently in trying to uncover the facts giving rise to their claims. Hexcel, 

681 F.3d at 1060; see also Conmar, 858 F.2d at 502; Beneficial Life, 851 F.2d at 276. “Where a 

plaintiff’s suspicions have been or should have been excited, there can be no fraudulent 

concealment where he [or she] ‘could have then confirmed his [or her] earlier suspicion by a 

diligent pursuit’ of further information.” Conmar, 858 F.2d at 504 (quoting Rutledge v. Boston 

Woven Hose & Rubber Co., 576 F.2d 248, 250 (9th Cir. 1978)). “The requirement of diligence is 

only meaningful, however, when facts exist that would excite the inquiry of a reasonable person.” 

Conmar, 858 F.2d at 504.

Here, Defendants focus primarily on whether Plaintiffs have sufficiently alleged that 

Plaintiffs diligently investigated their claims. See Mot. at 17. More specifically, Defendants 

contend that “[r]egardless of when plaintiffs had notice of their claims, they offer no allegations 

whatsoever as to what they did to investigate them.” Id. Defendants’ argument puts the cart before 

the horse, however, as Plaintiffs were not obligated to investigate their claims until Plaintiffs had 

reason to suspect the existence of their claims. See Conmar, 858 F.2d at 504–05; see also In re 

Coordinated Pretrial Proceedings, 782 F. Supp. at 498 (“Due diligence is not required in the 

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abstract. Plaintiffs are not under a duty continually to scout around to uncover claims which they 

have no reason to suspect they might have.”). In other words, as the parties appear to agree, 

Plaintiffs’ duty to diligently investigate their claims would only have been triggered by inquiry 

notice. 

Plaintiffs allege that Plaintiffs “had no reason to know Defendants had conspired to 

suppress compensation . . . until 2013, when incriminating documents were unsealed and filed 

publicly in the High-Tech docket.” SAC ¶ 184. Plaintiffs further allege that Plaintiffs diligently 

pursued and investigated their claims shortly after the “documents disclosing the conspiracy were 

first released, and just two months after the first news article suggesting that the conspiracy might 

go beyond the one in the high-tech industry.” Id. ¶ 189. Moreover, Plaintiffs also argue that 

“plaintiffs tried to obtain information that might have given rise to their claims, but such inquiries 

were met with misrepresentations.” Opp. at 21 (citing SAC ¶¶ 147–48, 150, 165, 183). Defendants 

contend, in a footnote, that Plaintiffs “were on notice by early 2010, if not sooner” based on 

“many widely read publications” reporting the DOJ’s investigation “into employment practices at 

high tech companies - specifically including firms in Northern California, where Pixar and 

Lucasfilm are located and where DreamWorks has a production facility.” Mot. at 17, n.16. 

As a threshold matter, the Court agrees with Plaintiffs that the question of constructive 

knowledge and inquiry notice generally “presents a question for the trier of fact.” Volk, 816 F.2d 

at 1417. Moreover, the fact that “widely read publications” reported a DOJ investigation of “high 

tech firms” that were in physical proximity to some Defendants is insufficient to show that 

Plaintiffs, as a matter of law, should have been on inquiry notice of their claims. See, e.g., 

Conmar, 858 F.2d at 503–04 (holding that issue of whether newspaper articles and public record 

of the defendant’s indictment triggered inquiry notice could not be resolved at summary 

judgment); In re Coordinated Pretrial Proceedings, 782 F. Supp. at 497 (finding genuine issue of 

material fact existed as to inquiry notice based on newspaper articles describing government 

investigation); E.W. French, 885 F.2d at 1400 (reversing directed verdict and holding that 

plaintiff’s knowledge of a similar lawsuit against the named defendants did not necessarily

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constitute actual or constructive knowledge as a matter of law). The Court further notes that courts 

have “been hesitant to dismiss an otherwise fraudulently concealed antitrust claim for failure to 

sufficiently allege due diligence,” because questions of inquiry notice are “necessarily bound up 

with the facts of the case.” In re Magnesium Oxide Antitrust Litig., No. 10-5943, 2011 WL

5008090, at *24 (D.N.J. Oct. 20, 2011). 

At this stage, the Court is not persuaded that Plaintiffs’ were on inquiry notice of their 

claims as a matter of law. It may be the case that Defendants can later prove that Plaintiffs were on 

inquiry notice of their claims before 2013 when Plaintiffs allege that they first had access to the 

public documents on the High-Tech docket. However, Defendants’ bare assertion that Plaintiffs 

should have been on notice of their claims based on “widely read publications” describing the 

DOJ’s investigation of companies in the same geographic area is insufficient to warrant dismissal 

of Plaintiffs’ fraudulent concealment claim. Even assuming this allegation were facially sufficient, 

“[i]t is impossible to declare at this . . . stage that plaintiffs failed to exercise due diligence to 

follow up on that which may or may not have been sufficient to excite their suspicions.” Rubber 

Chemicals, 504 F. Supp. 2d at 788 (internal quotation marks omitted). Accordingly, the Court 

finds that Plaintiffs have sufficiently alleged both that Plaintiffs lacked actual or constructive 

knowledge of the facts giving rise to their claims, and that Plaintiffs acted diligently under the 

circumstances.

In sum, the Court finds that Plaintiffs have adequately alleged the elements of a fraudulent 

concealment claim. Plaintiffs have pled specific facts showing that certain Defendants took 

affirmative steps to conceal the existence of Plaintiffs’ claims. See Hexcel, 681 F.3d at 1060. 

Moreover, the Court finds that Plaintiffs have adequately alleged that Plaintiffs did not have actual 

or constructive knowledge of their claims, and that Plaintiffs acted diligently once Plaintiffs 

discovered their claims. 

Accordingly, the Court DENIES Defendants’ motion to dismiss Plaintiffs’ claims as time 

barred, as the Court finds that Plaintiffs’ allegations of fraudulent concealment are sufficient to toll 

the statute of limitations. 

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B. Plaintiffs’ claims against Defendants Blue Sky, Sony Pictures, and Two Pic MC 

LLC

Defendants Blue Sky and Sony Pictures separately move to dismiss Plaintiffs’ claims 

against them on two grounds. First, Blue Sky and Sony claim that Plaintiffs have failed to

specifically allege fraudulent concealment against Blue Sky, Sony, and Two Pic MC LLC (f/k/a 

ImageMovers Digital). Second, Defendants Blue Sky and Sony contend that the SAC fails to state 

viable antitrust claims against Blue Sky and Sony as a matter of law. Mot. at 24. The Court 

considers each argument in turn. 

1. Fraudulent Concealment as to Defendants Blue Sky and Sony Pictures

Defendants contend that Plaintiffs have failed to make any specific allegations regarding 

fraudulent concealment with respect to Defendants Blue Sky, Sony, and Two Pic MC LLC (f/k/a 

ImageMovers Digital). Mot. at 22. The parties dispute whether all Defendants may be held liable 

for fraudulent concealment based on the actions of alleged co-conspirators, which were 

presumably in furtherance of the conspiracy. The Court begins by addressing whether Plaintiffs 

are obligated to allege fraudulent concealment as to each Defendant, before addressing the 

sufficiency of Plaintiffs’ allegations.

Here, Plaintiffs contend that “[e]very appellate court to decide the issue has held that the 

fraudulent concealment of a conspiracy ‘may be established through the acts of co-conspirators.’” 

Opp. at 15 (quoting In re Scrap Metal Antitrust Litig., 527 F.3d 517, 538 (6th Cir. 2008), and 

citing Riddell v. Riddell Wash. Corp., 866 F.2d 1480, 1493 (D.C. Cir. 1989) (“[A]ffirmative acts 

of concealment by one or more of the conspirators can be imputed to their co-conspirators for 

purposes of tolling the statute of limitations.”); Hendrickson Bros., 840 F.2d at 1085 (same); see 

also In re Transpacific Passenger Air Transp. Antitrust Litig., No. 07-05634 CRB, 2011 WL 

1753738, at *21 (N.D. Cal. May 9, 2011) (rejecting argument that plaintiffs must make specific 

allegations of fraudulent concealment by particular defendants). Defendants argue, however, that 

the Ninth Circuit has held otherwise.

In Barker v. American Mobil Power Corp., 64 F.3d 1397, 1402 (9th Cir. 1995), the Ninth 

Circuit held that “‘Plaintiffs may not generally use the fraudulent concealment by one defendant as 

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a means to toll the statute of limitations against other defendants.’” (quoting Griffin v. McNiff, 744 

F. Supp. 1237, 1256 n.20 (S.D.N.Y. 1990), aff’d, 996 F.2d 303 (2d Cir. 1993)). The Barker court 

held that the “common law doctrine of ‘fraudulent concealment’” may toll the statute of 

limitations “only if the plaintiff ‘establishes affirmative conduct upon the part of the defendant

which would, under the circumstances of the case, lead a reasonable person to believe that he [or 

she] did not have a claim for relief.’” Barker, 64 F.3d at 1402 (quoting Volk, 816 F.2d at 1415). 

Defendants rely on Barker for the proposition that Plaintiffs may not hold Defendants Blue 

Sky, Sony, or Two Pic MC LLC liable for any alleged fraudulent concealment committed by the 

other coconspirator Defendants, regardless of whether or not that fraudulent concealment was 

committed in furtherance of the conspiracy. While such an interpretation is superficially 

appealing, the Court concludes that Barker cannot stand for such a broad proposition when read 

with Ninth Circuit conspiracy and antitrust cases.

15

In Barker, the Ninth Circuit was careful to note that the requirement that a plaintiff allege 

fraudulent concealment as to each defendant was the “general[]” rule. Id. As Plaintiffs note, the 

Ninth Circuit has not specifically addressed whether in a case alleging a conspiracy, whether a 

plaintiff must specifically allege fraudulent concealment on the part of each and every conspirator. 

Barker did not involve an alleged conspiracy, but instead addressed whether the alleged fraud or 

concealment by the defendants’ “successor fiduciaries” could be used to toll the statute of 

limitations against the defendants. Barker, 64 F.3d at 1401–02. The Barker court therefore had no 

occasion to opine on whether conspiracy law would pose an exception to the “general[]” rule that 

a plaintiff must allege fraudulent concealment against each defendant. 

Similarly, none of the district court cases that the Barker court quoted and relied upon for 

 

15 The Court notes that Plaintiffs are incorrect in attempting to limit Barker solely to Employee 

Retirement Income Security Act (“ERISA”) cases. It is true that the Barker court was interpreting 

the “fraud or concealment” exception in the ERISA statute. Barker 64 F.3d at 1401–02. However, 

the Ninth Circuit held that the “‘fraud or concealment’ exception in the statute incorporates the 

common law doctrine of ‘fraudulent concealment.’” Id. at 1402. The Barker court then cited its 

prior decision in Volk and other persuasive authority for the proposition that under the common 

law doctrine of fraudulent concealment, a plaintiff must “generally” allege fraudulent concealment 

as to each defendant. Id.

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the proposition that “the doctrine of fraudulent concealment tolls the statute of limitations only as 

to those defendants who committed the concealment,” id. (quoting Greenwald v. Manko, 840 F. 

Supp. 198, 203 (E.D.N.Y. 1993)), addressed alleged acts of fraudulent concealment by a 

coconspirator in furtherance of the conspiracy. See Greenwald, 840 F. Supp. at 198–202 

(individual defendants with no conspiracy allegation); Griffin, 744 F. Supp. at 1255–56 

(dismissing conspiracy claim and finding plaintiffs were on inquiry notice); O’Brien v. Nat’l Prop. 

Analysts Partners, 719 F. Supp. 222, 232 (S.D.N.Y. 1989) (finding that the “bare conspiracy 

allegation” was insufficient under Rule 9(b) and that the alleged RICO conspiracy had no 

relationship to the alleged fraudulent concealment by non-conspirators). Instead, those cases either 

involved no conspiracy allegations at all, insufficient allegations that were dismissed, or 

allegations of a conspiracy that bore no relationship with the alleged fraudulent concealment.

O’Brien, 719 F. Supp. at 232. Nor did any of those cases involve alleged antitrust violations or 

discuss joint and several liability under either antitrust or conspiracy law.

As Defendants concede, the antitrust laws “impose joint and several liability.” Reply at 16, 

n.15. Moreover, the Ninth Circuit has made clear that the “action of any of the conspirators to 

restrain or monopolize trade is, in law, the action of all,” and “[a]ll conspirators are jointly liable 

for the acts of their co-conspirators.” Beltz Travel Serv., Inc. v. Int’l Air Transp. Ass’n, 620 F.2d 

1360, 1366–67 (9th Cir. 1980). In Beltz, the Ninth Circuit explained that:

If [a plaintiff] can establish the existence of a conspiracy in violation 

of the antitrust laws and that [defendants] were a part of such a 

conspiracy, [defendants] will be liable for the acts of all members of 

the conspiracy in furtherance of the conspiracy, regardless of the 

nature of [defendants’] own actions. Participation by each 

conspirator in every detail in the execution of the conspiracy is 

unnecessary to establish liability, for each conspirator may be 

performing different tasks to bring about the desired result.

Id. at 1367. Notwithstanding this well-established body of antitrust and conspiracy law, 

Defendants contend that under Barker, a coconspirator may not be held liable for the fraudulent 

concealment of another member of the conspiracy even if that fraudulent concealment was in 

furtherance of the conspiracy. 

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The Court is not persuaded. Defendants’ proposed application of Barker is incompatible 

with Beltz’s holding that, as a fundamental principle of conspiracy law, coconspirators are “liable 

for the acts of all members of the conspiracy in furtherance of the conspiracy, regardless of the 

nature of [the coconspirators’] own actions.” Id. As the Ninth Circuit recognized in Beltz, it may 

be the case that certain members of the conspiracy are “performing different tasks to bring about 

the desired result.” Id. Under Defendants’ overly broad interpretation of Barker, if two members 

of a conspiracy are responsible for misleading potential plaintiffs from the existence, scope, or 

effects of an anticompetitive conspiracy, and other members are responsible for implementing 

other integral functions of the conspiracy, a plaintiff seeking to toll the statute of limitations may 

only bring claims against the first two members of the conspiracy. Such an outcome cannot be 

reconciled with the Ninth Circuit’s explicit holding in Beltz, that “[p]articipation by each 

conspirator in every detail in the execution of the conspiracy is unnecessary to establish liability, 

for each conspirator may be performing different tasks to bring about the desired result.” Id.

Defendants also rely on Rule 9(b)’s heightened pleading requirement in support of their 

argument that Plaintiffs must allege specific acts of fraudulent concealment by each conspirator. 

Defendants quote language from the Ninth Circuit’s decision in Swartz that under Rule 9(b), a 

plaintiff must “identify the role of each defendant in the alleged fraudulent scheme” and 

“differentiate their allegations and inform each defendant separately of the allegations surrounding 

his [or her] alleged participation in the fraud.” Swartz, 476 F.3d at 765. Defendants fail to note

however, that the Swartz court began that same paragraph with the rule that “there is no absolute 

requirement that where several defendants are sued in connection with an alleged fraudulent 

scheme, the complaint must identify false statements made by each and every defendant.” Id. at 

764. The Swartz court then proceeded to quote Beltz’s holding that “[p]articipation by each 

conspirator in every detail in the execution of the conspiracy is unnecessary to establish liability . . 

. .” Id. (quoting Beltz, 620 F.2d at 1367). 

Here, the Court finds that Plaintiffs have not “merely lump[ed] multiple defendants 

together,” but made specific factual allegations as to each Defendant and its participation in the 

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alleged conspiracy. See Swartz, 476 F.3d at 765 (citing Haskin v. R.J. Reynolds Tobacco Co., 995 

F. Supp. 1437, 1439 (M.D. Fla. 1998)). Swartz does not stand for the proposition that Plaintiffs 

must allege specific acts of fraudulent concealment as to each Defendant. To the contrary, the 

Swartz court specifically disavowed any such requirement and cited Beltz. Instead, Swartz requires

only that Plaintiffs must make specific factual allegations with respect to each Defendant’s alleged 

participation in the scheme as a whole. See Swartz, 476 F.3d at 764–65. As discussed in further 

depth below, the Court finds that Plaintiffs have satisfied this requirement.

Accordingly, the Court denies Defendants Blue Sky’s and Sony’s motion to dismiss 

Plaintiffs’ claims against them and Two Pic MC LLC as time barred. 

2. Plaintiffs’ claims against Defendants Blue Sky and Sony 

In addition to Defendants’ arguments with respect to fraudulent concealment, Defendants 

Blue Sky and Sony further contend that Plaintiffs have failed to plead plausible claims for relief 

against either Defendant. The Court begins by laying out the relevant legal standard before 

addressing the adequacy of Plaintiffs’ allegations against Defendants Blue Sky and Sony. 

The Court notes from the outset that Defendants’ disagreements with Plaintiffs’ 

characterizations or interpretations of certain factual allegations do not go to the sufficiency of 

Plaintiffs’ allegations on a motion to dismiss. See Moss v. United States Secret Serv., 572 F.3d 

962, 969 (9th Cir. 2009) (“[F]or a complaint to survive a motion to dismiss, the non-conclusory 

factual content, and reasonable inferences from that content, must be plausibly suggestive of a 

claim entitling the plaintiff to relief.”) (internal quotation marks omitted). At the pleading stage, a 

complaint claiming conspiracy, to be plausible, must plead “enough factual matter (taken as true) 

to suggest that an agreement was made,” i.e., it must provide “some factual context suggesting 

[that the parties reached an] agreement,” not facts that would be “merely consistent” with an 

agreement. Twombly, 550 U.S. at 556, 549, 557. However, the plausibility requirement does not 

require that a plaintiff show that “its allegations suggesting an agreement are more likely than not 

true or that they rule out the possibility of independent action, as would be required at later 

litigation stages such as a defense motion for summary judgment, or a trial.” Anderson News, 

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L.L.C. v. Am. Media, Inc., 680 F.3d 162, 184 (2d Cir. 2012) (citing Twombly, 50 U.S. at 556; 

Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 597–98 (1986)) (internal 

citations omitted). 

a. Defendant Blue Sky

Defendant Blue Sky claims that Plaintiffs fail to provide “even the most basic facts of Blue 

Sky’s supposed participation in a non-solicitation conspiracy.” Mot. at 24. However, the Court 

finds that Plaintiffs’ factual allegations and the “reasonable inferences” from Plaintiffs’ factual 

allegations are sufficient to allege that Blue Sky agreed to and participated in the alleged 

conspiracy. For example, Plaintiffs specifically aver that Defendant Pixar’s internal “Competitors 

List” instructed Pixar not to recruit or poach employees from Blue Sky, DreamWorks, 

ImageMovers, Sony Pictures Imageworks, and Walt Disney. SAC ¶ 53. Similarly, Pixar’s 

McAdams explained that Pixar had “gentleman’s agreements” with ILM, Sony, and Blue Sky, 

among others. Id. ¶ 54. Blue Sky characterizes the “Competitor List” as nothing but “a statement 

of Pixar’s policy,” and argues that the list does not indicate that there was some sort of agreement 

involving Blue Sky. Reply at 18. In opposition, Plaintiffs contend that the only plausible inference 

from these allegations is a conspiracy. Indeed, as Plaintiffs argue, it is not evident why Pixar, Blue 

Sky’s competitor, would refuse to recruit or poach from Blue Sky absent some sort of mutual 

agreement. At a minimum, the inclusion of Blue Sky on Pixar’s anti-solicitation list renders it 

plausible that Blue Sky was an active participant in the conspiracy. 

Similarly, Plaintiffs point to an alleged conversation between Pixar’s McAdams and Blue 

Sky’s Director of Human Resources, Linda Zazza, where McAdams assured Zazza “that [Pixar] 

[was] not making calls to their people or trying to poach them in any way.” SAC ¶ 71. Absent an 

agreement not to poach, it is not clear why Pixar would call to reassure a competitor that it was not 

poaching the competitors’ employees. In addition, Plaintiffs allege that when Zazza “noticed a 

trend of departing employees,” she quickly “‘probed to find out if they’ve been approached by 

Pixar, etc.’ to see if a violation of the no-poach agreement caused the employees to leave Blue 

Sky.” SAC ¶ 72. Defendants contend that Zazza’s actions were merely “a routine effort to 

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ascertain why Blue Sky lost employees to its competitors.” Mot. at 25. However, Plaintiffs have 

alleged that Zazza’s probe was “to see if a violation of the no-poach agreement caused the 

employees to leave.” SAC ¶ 72. While the parties obviously differ in their interpretations of these 

events, these allegations support the plausible theory that Blue Sky was a member of the 

conspiracy. Moreover, at the motion to dismiss stage, the Court must draw all reasonable 

inferences in favor of Plaintiffs. See Knevelbaard, 232 F.3d at 984.

Defendants contend that Plaintiffs’ allegations are merely “not inconsistent with” Blue 

Sky’s participation in the alleged conspiracy based on Defendants’ contrary interpretations and 

inferences from Plaintiffs’ factual allegations. See Reply at 18–19. As discussed above, however, 

the Court finds that Plaintiffs have put forth specific factual allegations that allow the Court to 

“draw the reasonable inference that” Blue Sky participated in the alleged conspiracy. Iqbal, 556 

U.S. at 678. Blue Sky may well be able to prove, as a factual matter, that it was not a member of 

the alleged conspiracy.16 At this stage of the proceedings, however, the Court evaluates not the 

probability of Plaintiffs’ success on the merits, but whether Plaintiffs have alleged “sufficient 

factual matter, accepted as true, to ‘state a claim to relief that is plausible on its face.’” Id. Here, 

drawing all reasonable inferences in favor of Plaintiffs, the Court finds that Plaintiffs have done 

so. See Knevelbaard, 232 F.3d at 984.

Accordingly, the Court DENIES Defendant Blue Sky’s motion to dismiss Plaintiffs’ 

claims against it. 

b. Defendant Sony 

Defendant Sony also contends that Plaintiffs’ allegations that Sony participated in the 

alleged conspiracy are “implausible.” Reply at 19. For the reasons stated below, however, the 

Court finds that Plaintiffs have adequately alleged that Sony participated in the conspiracy. 

 

16 Indeed, to the extent Blue Sky relies on its own apparent “repeated efforts” to recruit from 

competitors, or George Lucas’s deposition testimony that Lucasfilm did not have an agreement 

with Blue Sky, the Court notes that these are factual disputes as to the truth of Plaintiffs’ claims, 

not the sufficiency of Plaintiffs’ allegations. As the Court is required to accept as true Plaintiff’s 

factual allegations and draw all reasonable inferences in favor of Plaintiffs on a motion to dismiss, 

the Court finds that Plaintiffs have sufficiently alleged a plausible claim for relief. See 

Knevelbaard, 232 F.3d at 984.

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Plaintiffs point to myriad examples of Sony’s alleged involvement in the conspiracy. For 

example, the SAC specifically alleges that Pixar’s Catmull met with Sony executives in order to 

stop Sony from poaching Pixar’s employees and to “reach an agreement where neither [Pixar nor 

Sony] let recruiters approach the other.” SAC ¶ 64–66. Catmull thought it was important for Sony 

to “quit calling [Pixar’s] employees.” Id. ¶ 65. Plaintiffs allege that Catmull reached a 

“gentleman’s agreement” with Sony not to directly solicit or poach each other’s employees. Id. ¶ 

67. Furthermore, Pixar’s McAdams spoke with Sony recruiters multiple times to “make sure 

they’re still honoring [the agreement].” Id. Indeed, when one Sony recruiter reached out to a Pixar 

employee, a Pixar recruiter suggested that Pixar “slap her on the wrist.” Id. As a result, McAdams 

apparently called her counterpart at Sony and told them to “knock it off.” Id. 

Similarly, the SAC includes allegations that Pixar included Sony on its “do not poach” list, 

id. ¶ 53, and that Sony human resources representatives exchanged sensitive compensation 

information with competitors, including salary information, id. ¶ 101, salary budgets, id. ¶ 103, 

salary ranges, id. ¶ 105, and overtime, id. ¶ 111. Moreover, when Sony laid off a number of 

employees and rehired them at lower rates, Sony allegedly advised Pixar to “stand firm in [its] 

offers to exSony candidates and not worry too much about matching [the exSony candidates’] last 

Sony rate.” Id. ¶ 12. As Plaintiffs note, these factual allegations support the plausible theory that

Sony both participated in the anti-solicitation scheme and also colluded with the other Defendants 

on salary ranges. 

Sony contends that it never entered into the “gentleman’s agreement” to begin with and 

that Plaintiffs’ factual allegations actually support the conclusion that Sony was actively poaching 

the employees of its competitors. However, as Plaintiffs note, that Sony may have violated the 

alleged agreement does not disprove Sony’s involvement in the conspiracy as a matter of law. 

Opp. at 29. Indeed, if Sony were not part of the conspiracy to begin with, there would be no need 

for Pixar to tell Sony to “knock it off (again!).” Id. Plaintiffs argue that “[n]o one calls a 

competitive rival who is undercutting on price to say knock it off unless they have an agreement 

on price because undercutting them on price is just what a rival is supposed to do.” Id. Based on 

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the specific factual allegations Plaintiffs make, this is not an unreasonable inference. 

Sony also argues that absence of any Sony documents evincing its participation in the 

conspiracy renders Plaintiffs’ claims implausible. While this may ultimately weigh against the 

probability that Plaintiffs will prevail on their claims against Sony, the Court sees no reason why 

Plaintiffs’ inability to identify Sony documents at the motion to dismiss stage would render 

Plaintiffs’ claims insufficient as a matter of law. Indeed, the standard for surviving a motion to 

dismiss asks whether Plaintiffs have pled “enough fact[s] to raise a reasonable expectation that 

discovery will reveal evidence of illegal agreement.” Twombly, 550 U.S. at 556. It does not require 

that Plaintiffs have evidence of the alleged illegal agreement in hand. 

In addition, Sony argues that Plaintiffs’ claims do not “comport with ‘basic economic 

principles.” Reply at 20 (quoting William O. Gilley Enters., Inc. v. Alt. Richfield Co., 588 F.3d 

659, 662 (9th Cir. 2009)). Sony asserts that it is “economically implausible that a firm seeking 

more workers . . . would voluntarily hamstring its ability to do so by forgoing a readily available 

pool of workers from other film studios.” Id. However, Plaintiffs contend that Sony could have 

rationally concluded that agreeing to the conspiracy in order to reduce the overall costs of 

expansion would be beneficial. Moreover, as an alleged “cheater” to the conspiracy, Sony could, 

theoretically, “have its cake and eat it too,” by reaping the benefits of overall lower costs while 

poaching those employees that Sony found most desirable while attempting to avoid retaliation by 

other members of the conspiracy. As Plaintiffs have put forth an alternative plausible explanation, 

the Court is not persuaded by Sony’s bare assertion that Plaintiffs’ claim is “economically 

implausible” as a matter of law. 

As with Defendant Blue Sky, it may be the case that Sony can, as a factual matter, 

disprove its participation in the alleged conspiracy. However, the question at the motion to dismiss 

stage is not whether Plaintiffs have shown a probable claim, but instead a plausible one. See Iqbal, 

556 U.S. at 678. Here, the Court finds that Plaintiffs have alleged a plausible claim against 

Defendant Sony. Accordingly, the Court DENIES Defendant Sony’s motion to dismiss Plaintiffs’ 

claims against it. 

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C. Per se wage-fixing claim

Finally, Defendants contend that Plaintiffs have failed to adequately plead a per se wagefixing claim. Here, the parties dispute whether Plaintiffs’ conspiracy claims should be analyzed as 

a single conspiracy to suppress the compensation of putative class members, or two separate 

conspiracies: a no-poaching conspiracy and a wage-suppression conspiracy. Opp. at 21; Reply at 

12. Defendants argue that because Plaintiffs’ conspiracy claims are based on two distinct 

agreements, Plaintiffs must plead sufficient facts to independently support each claim. While 

Defendants do not contend that Plaintiffs have failed to plead a per se violation of the Sherman 

Act with respect to the non-solicitation agreements, Defendants allege that Plaintiffs have failed to 

plead a per se wage-fixing claim.

The Court begins by noting that Defendants cite no authority for the proposition that 

Plaintiffs may not allege the existence of a single overarching conspiracy to suppress employees’ 

compensation or that Defendants’ recharacterization requires dismissal of Plaintiffs’ claims. To 

the contrary, courts have generally rejected attempts by defendants to recharacterize a plaintiff’s 

theory of an overarching conspiracy. For example, in TFT-LCD, the defendants argued that the 

plaintiffs’ “specific allegations . . . contradict[ed] the notion of a single overarching conspiracy” 

and instead supported the defendants’ alternative theory that plaintiffs had been “harmed by 

different, unconnected alleged agreements” and conspiracies. 267 F.R.D. at 606–07. The TFTLCD court rejected the defendants’ argument, finding that the “defendants may not recast 

plaintiffs’ allegations, and plaintiffs have consistently alleged a single, overriding conspiracy 

spanning the entire class period.” Id.; see also In re Vitamins Antitrust Litig., 209 F.R.D. 251, 265 

(D.D.C. 2002) (“The plaintiffs have not alleged multiple conspiracies—they have alleged a single 

price fixing conspiracy . . . . ‘[T]he character and effect of a conspiracy are not to be judged by 

dismembering it and viewing its separate parts but only by looking at it as a whole.’” (quoting 

Cont’l Ore Co. v. union Carbide & Carbon Co., 370 U.S. 690, 699 (1962)). 

Similarly, in In re Air Cargo Shipping Services Antitrust Litigation, No. 06–MD–1175, 

2014 WL 7882100, at *28 (E.D.N.Y. Oct. 15, 2014), the defendants offered a competing 

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interpretation of the plaintiffs’ conspiracy allegations. Rather than the global conspiracy that the 

plaintiffs alleged, the defendants contended that the plaintiffs had only alleged a “collection of 

route-specific conspiracies.” Id. As in TFT-LCD and In re Vitamins, the Air Cargo court 

concluded that “the mere fact that the defendants have a different case theory should not deprive 

the plaintiffs of the opportunity to prove theirs.” Id. Moreover, “[w]hether the plaintiffs’ proof of 

such a conspiracy is more or less compelling than the defendants’ alternative theory is a question 

of fact for the jury.” Id.

Defendants cite this Court’s decision in Steshenko v. Gayrard, 70 F. Supp. 3d 979, 999 

(N.D. Cal. 2014), in support of its argument that the Court should parse Plaintiffs’ claims as two 

separate conspiracies. See Reply at 12. However, in Steshenko, the plaintiff alleged the existence 

of three separate conspiracies and did not contend that there was a single, overarching conspiracy. 

See id. Here, it is not evident to the Court why it should disregard Plaintiffs’ allegation that 

Defendants engaged in a single overarching conspiracy to suppress employee compensation by 

refraining from poaching each other’s employees and also setting compensation ranges. That 

Defendants choose to re-cast Plaintiffs’ allegations as supporting the existence of two separate 

conspiracies does not change the fact that Plaintiffs have alleged the existence of a single 

conspiracy, involving a single group of conspirators, that allegedly engaged in the same anticompetitive behavior. 

Moreover, while Defendants contend that Plaintiffs should not be able to “evade Twombly 

by combining two self-evidently distinct alleged agreements into a single claim for relief,” the 

Court is not persuaded that Plaintiffs have, in fact, alleged two “self-evidently distinct” 

agreements. Reply at 12. Plaintiffs have alleged that each Defendant “entered into the agreement 

to suppress compensation of class members, including (i) entering the non-solicitation scheme; 

and (ii) engaging in direct communications regarding compensation ranges.” Opp. at 24 (citing 

SAC ¶¶ 1–2, 9). Though Defendants may disagree with Plaintiffs’ theory of the case, Defendants 

have failed to put forth any authority for the proposition that the Court should, at this stage of the 

proceeding, determine whether Plaintiffs have really alleged one conspiracy or two. Cf. United 

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States v. Smith, 320 F.3d 647, 652 (6th Cir. 2003) (“Whether single or multiple conspiracies have 

been shown is usually a question of fact to be resolved by the jury . . . .”).

Furthermore, the Court concludes that Plaintiffs have alleged sufficient facts to support a 

plausible per se claim that Defendants allegedly conspired to suppress the compensation of the 

putative class. As discussed above, Defendants do not contest the sufficiency of Plaintiffs’ 

allegations with respect to Defendants’ participation in the anti-solicitation or no-poach scheme. In 

addition, Plaintiffs allege that Defendants participated in comprehensive and sustained information 

sharing, both through in-person meetings and through email. According to Plaintiffs, Defendants 

participated in industry-wide meetings organized by the Croner Company, which were allegedly

organized “so [Defendants could] each confirm or adjust [their] salary ranges.” Id. ¶ 87. Such 

meetings allegedly “provided the officials an opportunity to discuss compensation ranges in a 

private setting.” Id. ¶ 89. For example, at one meeting, Pixar apparently learned that ImageMovers 

was recruiting employees at a higher salary, leading Catmull to ask Disney’s chairman to step in: 

“The HR folks from the CG studios had their annual get together in the bay area (sic) last week. At 

that time, we learned that the company that Zemeckis is setting up in San Rafael has hired several 

people away from Dreamworks at a substantial salary increase.” Id. ¶ 90. As a result, Catmull and 

Disney apparently told the founder of ImageMovers that it was “important . . . that we not have a 

hiring war.” Id. In addition, Plaintiffs allege that Defendants requested “custom cuts” of Croner 

Survey data limited to conspiracy participants—namely, Blue Sky, DreamWorks, Lucasfilm, 

Sony, and Pixar. Id. ¶ 93. According to Plaintiffs, this was to ensure that the collusion was 

effective. Id. 

Furthermore, Plaintiffs allege that these exchanges of information were not “isolated,” but 

rather, systematic and constant. The complaint is replete with allegations that Defendants 

frequently exchanged information about salary ranges, benefits, and other HR matters. Pixar’s 

McAdams notes that the Defendants talked with each other “to ensure that our salary ranges for 

the positions are correct.” Id. ¶ 86. Blue Sky’s human resources director allegedly emailed Pixar 

asking for salary information for specific positions in order “to find out if we’re paying a 

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competitive rate.” Id. ¶ 96 (“I was wondering if I could get some salary information from you . . . 

Please see the titles below and if possible, could you give me a range of what you pay them?”). 

Pixar also sought salary information for specific positions from Disney. Id. ¶ 106 (“[W]ork . . . on 

getting the MCC position descriptions updated, and from there we can talk with Disney or other 

studios & post houses to ensure that our salary ranges for the positions are correct.”). Plaintiffs 

contend that information sharing was not just limited to salary information, but included benefits 

as well. Id. ¶ 97 (health insurance); id. ¶ 98 (401k); id. ¶99 (“memberships”); id. ¶ 100.

While the mere “exchange of price data and other information among competitors does not 

invariably have anticompetitive effects” and does not constitute a per se violation of the Sherman 

Act, U.S. v. U.S. Gypsum Co., 438 U.S. 422, 441 n.16 (1978), taken in context, the factual 

allegations here plausibly suggest that the purpose of information sharing and the anti-solicitation 

scheme was to suppress wages. Plaintiffs contend that Defendants’ emails “[make] it clear that the 

purpose of the conspirators’ collusion on compensation was to keep compensation low.” Id. ¶ 109. 

As Pixar’s McAdams wrote to ILM’s Coker, “[s]ince money can always be a factor, that’s the 

other thing we should consider (e.g., we wouldn’t want to offer a lateral move more money than 

you, and vice versa).” Id. (emphasis added). Similarly, Plaintiffs contend that the Defendants’ 

actual hiring practices demonstrate that the purpose of the information sharing and the antisolicitation scheme was to suppress wages. For example, Plaintiffs aver that in 2008 and 2009, 

Sony laid off hundreds of employees and hired them back at lower rates—rates squarely in the 

range the conspirators had discussed in previous meetings. Id. ¶ 115. Sony allegedly made sure 

that its co-conspirators knew not to match its previous, higher rates by telling other studios that 

Sony was “rehiring folks back at a lower rate than when they left” and encouraging the coconspirators to “stand firm in [their] offers to exSony candidates and not worry too much about 

matching their last Sony rate.” Id.

In sum, the Court finds that Plaintiffs have sufficiently alleged facts showing that 

Defendants reached an agreement to conspire. Here, Plaintiffs have alleged that Defendants 

systematically shared information, agreed not to solicit each other’s employees, and that the 

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United States District Court

Northern District of California

purpose of the information sharing and no-poach scheme was to suppress wages. Taking these 

allegations as true, and drawing all reasonable inferences in favor of Plaintiffs, the Court finds that 

these allegations raise a plausible inference that Defendants entered into an express agreement to 

suppress compensation. See Knevelbaard, 232 F.3d at 984.

For the foregoing reasons, the Court finds that Plaintiffs have successfully alleged a single 

conspiracy to suppress the compensation of Defendants’ employees. Accordingly the Court denies 

Defendants’ motion to dismiss Plaintiffs’ per se antitrust claim.17

IV.CONCLUSION

For the foregoing reasons, the Court DENIES Defendants’ motion to dismiss. 

IT IS SO ORDERED.

Dated: August 20, 2015

______________________________________

LUCY H. KOH

United States District Judge

 

17 Defendants request, in passing, that the Court “dismiss or strike” Plaintiffs’ wage-fixing claim. 

Federal Rule of Civil Procedure 8(b)(3) requires a party to state “a demand for the relief sought, 

which may include relief in the alternative or different types of relief.” Rule 12(f) permits a court 

to “strike from a pleading . . . any redundant, immaterial, impertinent, or scandalous matter.” Fed.

R. Civ. P. 12(f). A matter is immaterial if it “has no essential or important relationship to the claim 

for relief or the defenses being pleaded.” Fantasy, Inc. v. Fogerty, 984 F.2d 1524, 1527 (9th Cir.

1993), rev’d on other grounds, 510 U.S. 517 (1994). A matter is impertinent if it consists of 

statements that do not pertain to and are not necessary to the issues in question. Id. Redundant 

allegations are those that are wholly foreign to the issues involved or the needless repetition of 

allegations. Sliger v. Prospect Mortg., LLC, 789 F. Supp. 2d 1212, 1216 (E.D. Cal. 2011). As the 

Court finds that Plaintiffs have sufficiently pled a per se antitrust claim based on Defendants’ 

alleged conspiracy to suppress employee compensation, the Court DENIES Defendants’ request to 

strike. 

Case 5:14-cv-04062-LHK Document 147 Filed 08/20/15 Page 55 of 55