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Pratt & Whitney and Suppliers No-Poach Agreements Antitrust Class Action

The complaint for this class action puts its allegations in one compact sentence: “Beginning in 2011 and continuing until at least 2019, six outsourcing firms and a powerful defense contractor entered into an illegal agreement (the ‘No Poach Agreement’) not to hire one another’s aerospace engineers and other skilled workers…” The defense contractor is Raytheon Technologies Corporation, Pratt & Whitney Division; the suppliers are Agilis Engineering, Inc. Belcan Engineering Group, LLC, Cyient, Inc., Parametric Solutions, Inc. (PSI), and QuEST Global Services-NA, Inc. Also named are six individuals.

The class for this action is all persons employed in the US, including in the fifty states, the District of Columbia, and US territories, as engineers or other skilled workers by Pratt & Whitney and the supplier defendants, or their parents, subsidiaries, or affiliates, from 2011 to 2019.

On December 7, 2021, Mahesh Patel, a Pratt & Whitney executive was arrested. The complaint calls him “the leader and primary enforcer of the No Poach Agreement.” Two days later, the Department of Justice (DOJ) made public an Affidavit of Support of Criminal Complaint and Arrest Warrant for him, setting forth the details of the conspiracy that the complaint alleges sought to reduce competition for engineers and thereby “to fix and suppress their salaries, benefits, and professional opportunities.”

On December 15, 2021, a grand jury indicted Patel and five executives from the supplier companies. The complaint quotes the DOJ as saying that the companies had “interwoven and overlapping hiring and recruiting restrictions” that “had a common purpose—to limit competition for, and thus restrict the free movement of, victim-employees within the outsource aerospace engineering industry—and thus artificially prolonged victim-employees’ tentures at their existing employers and eliminated or reduced their ability to negotiate the terms of their current or future employment.”

The complaint quotes one of the supplier conspirators as saying that the “general aim is NOT to recruit from the local ‘competition’ because no one wins; salaries rise, the workforce gets unstable, and our margins all get hurt.”

This class action is a civil lawsuit, following up on the criminal one, that attempts to gain compensation for the harm done to the workers. The complaint alleges that the no-poach “agreements unreasonably restrained trade and are per se unlawful under federal law.”

The supplier companies worked on projects outsourced to them by Pratt & Whitney. Although the initial agreements were verbal, the complaint extensively quotes e-mail communications between the companies that seek to confirm or enforce the no-poach agreement.

After quoting one series of e-mails discussing the issue of legality, the complaint alleges, “In other words, Defendants knew that their conspiracy not to recruit one another’s employees was against the law. They proceeded with it anyway.”

The complaint alleges that the no-poach agreements were successful in suppressing engineers’ pay. It claims, “The injury to Engineers—namely, the suppression of their compensation—is an injury of the type that the antitrust laws were meant to punish and prevent.”

Article Type: Lawsuit
Topic: Antitrust

Most Recent Case Event

Pratt & Whitney and Suppliers No-Poach Agreements Antitrust Complaint

December 27, 2021

The complaint for this class action puts its allegations in one compact sentence: “Beginning in 2011 and continuing until at least 2019, six outsourcing firms and a powerful defense contractor entered into an illegal agreement (the ‘No Poach Agreement’) not to hire one another’s aerospace engineers and other skilled workers…” The defense contractor is Raytheon Technologies Corporation, Pratt & Whitney Division; the suppliers are Agilis Engineering, Inc. Belcan Engineering Group, LLC, Cyient, Inc., Parametric Solutions, Inc. (PSI), and QuEST Global Services-NA, Inc. Also named are six individuals.

Pratt & Whitney and Suppliers No-Poach Agreements Antitrust Complaint

Case Event History

Pratt & Whitney and Suppliers No-Poach Agreements Antitrust Complaint

December 27, 2021

The complaint for this class action puts its allegations in one compact sentence: “Beginning in 2011 and continuing until at least 2019, six outsourcing firms and a powerful defense contractor entered into an illegal agreement (the ‘No Poach Agreement’) not to hire one another’s aerospace engineers and other skilled workers…” The defense contractor is Raytheon Technologies Corporation, Pratt & Whitney Division; the suppliers are Agilis Engineering, Inc. Belcan Engineering Group, LLC, Cyient, Inc., Parametric Solutions, Inc. (PSI), and QuEST Global Services-NA, Inc. Also named are six individuals.

Pratt & Whitney and Suppliers No-Poach Agreements Antitrust Complaint
Tags: Aerospace, Anticompetitive Actions, Antitrust, No-Poach Agreements