Palm CEO Rebuffed Apple’s No-Poach Deal: Report

When Apple CEO Steve Jobs approached the head of Palm suggesting the two companies reach an accord to not hire away each other’s top talent, Ed Colligan said “no thanks,” according to a Bloomberg report, citing a review of the companies’ communications.

In fact, Colligan, who left the company in June, sounded a little indignant in his refusal.

“Your proposal that we agree that neither company will hire the other’s employees, regardless of the individual’s desires, is not only wrong, it is likely illegal,” he said, according to the report.

The exchange between the two executives was said to come in August 2007, shortly after the debut of the iPhone and Palm’s hiring of Jon Rubinstein, the former Apple executive who replaced Colligan as the company’s chief. Jobs, apparently, was concerned that Rubinstein would try to lure away his former colleagues as he led the efforts to resurrect the ailing Palm.

“We must do whatever we can to stop this,” Bloomberg quotes Jobs as saying.

Apple spokeswoman Kristin Huguet said the company was not commenting on the report. Palm did not immediately respond to a request for comment.

Jobs’ attempt to strike a deal with Palm fits into a logical context, given Rubinstein’s network of connections at his former company and Palm’s designs on improving its position in the smartphone market, a push he was brought on board to lead.

The companies have since been engaged in escalating competition, seen most recently in the spat over Palm’s efforts to offer a syncing feature for Apple’s iTunes on its Pre smartphone.

But it also could add fuel to a collusion investigation underway at the Justice Department, where regulators are looking into the hiring practices of big tech companies.

When word of the probe surfaced in June, Apple was named as one of the dozen or so firms to have received letters of inquiry from the DoJ.

The investigation is examining whether rival IT firms are in the practice of striking no-poaching agreements in an attempt to suppress salary levels.

But anticompetitive practices also figure to play a part in any collusion investigation. The IT industry is no stranger to spats between rivals trying to poach away top talent.

In 2005, Microsoft and Google were involved in an ugly fight over Kai-Fu Lee, a top engineer Google hired away from the software giant.

More recently, Apple became embroiled in its own legal fracas involving Mark Papermaster, an executive the company had hired away from IBM, which sued, arguing that he was bound by a non-compete agreement.

News Around the Web