Earlier this year, we predicted that 2009 would bring an increase in government regulation and oversight.  It appears that a major wave of this increased regulation has just hit.  Yesterday, The Washington Post reported that the Department of Justice had begun investigating whether some of the nation’s largest technology companies violated antitrust laws by negotiating the recruiting and hiring of one another’s employees.

The Post cites two sources familiar with the situation. According to the Post, the review is in its preliminary stages and includes some major players in the technology sector, among them Apple, Google and Yahoo. The allegations seem to focus on agreements between companies not to hire away top talent. If true, these alleged activities could violate antitrust laws. Even if the allegations prove false, the target companies will likely need to gear up to respond to various DOJ information requests for many months to come. Based on the preliminary report about the nature of the allegations, the investigation will involve numerous enterprise data sources containing potentially relevant information that the DOJ would pressure to review.  Beyond the obvious e-mail systems, the target companies’ human resources, recruiting and training systems may be especially interesting to the DOJ. 

We will now see how well these companies have prepared for litigation and regulatory inquiries. Namely, have they implemented effective technology, process and people to allow them to review data in place, initiate preservation of potentially relevant data, collect the data and conduct a review and analysis in-house and/or with their outside counsel?  Even if they have taken steps to implement these activities, these recent investigations may be the first time that the tools, process and people are stress tested. We will be closely monitoring how these investigations play out over the coming months.

This recently announced wave of inquiries has prompted Recommind to issue an Information Risk Alert (#2009-5) which can be found at Recommind’s Risk Monitoring Center: http://www.recommind.com/knowledge_resources/rmc