silicon.com wins interim injunction against Jobserve over job ad threats

silicon.com contacted UKTECH today to provide some more information on the legal row between ATSCOjobs and Jobserve.

silicon.com provided a briefing document which we reproduce in full:-

Start document:

What was the action?

silicon.com, publishers of ATSCOjobs.com, yesterday (Dec 4th) applied and won an interim injunction in the Royal Courts of Justice to prevent Jobserve from making and carrying out a number of threats against potential and existing clients of ATSCOjobs.com. The order was granted and served on 4/12/00.

Who is Jobserve?

Jobserve was the first IT recruitment site in the UK. It is silicon.com's view that the company has a dominant market position.

silicon.com estimates Jobserve's market share at approximately 66%.

What was Jobserve's threat?

Jobserve threatened customers and potential customers of ATSCOjobs.com that should they advertise on the new site, ATSCOjobs.com, they would be banned from Jobserve.

What was wrong with Jobserve making these threats?

Many IT recruitment companies, particularly those specialising in IT contractor vacancies, cannot afford to be banned from Jobserve because it is by far and away the largest IT recruitment site in the UK. In silicon.com's view, Jobserve has a dominant market position and is abusing this position when issuing such threats.

Are these threats illegal if a company is a dominant player?

Yes - under the Competition Act 1998 a dominant market player is not allowed to use its dominant position in this way - to prevent the creation of new legitimate competitors. The Competition Act was implemented to ensure new innovative products and services cannot be stifled at birth by a dominant market player.

Did silicon.com contact Jobserve direct to attempt a settlement?

Yes - silicon.com had direct communication. However, it became obvious that Jobserve would not consider any resolution unless it involved silicon.com halting the launch of ATSCOjobs.com.

In silicon.com's view it is not acceptable to attempt to prevent a legitimate competitor entering the market and to abuse a dominant market position. silicon.com also gave Jobserve the opportunity to back down both prior to the court proceedings and in court. Jobserve failed to take up these opportunities, which could have meant an injunction did not need to be issued by the court.

What exactly did the court order Jobserve to do yesterday? silicon.com will be taking further action against Jobserve later in

December. In the interim, the court has ruled that Jobserve must not:

(A) Refuse to accept advertisements for IT job vacancies from any recruitment agency on the grounds that such agency also advertises, has advertised, or proposes to advertise IT job vacancies on the World Wide Web site operated by silicon.com and known as ATSCOjobs.com and/or from any recruitment agency that is a member of the Association of Technology Staffing Companies Limited ("ATSCo");

(B) require that any IT recruitment agency using or seeking to use its services does not advertise IT job vacancies on ATSCOjobs.com;

(C) deal with any IT recruitment agency advertising or wishing to advertise IT job vacancies on ATSCOjobs.com on terms that are materially different from the terms on which it deals with agencies that do not advertise, have not advertised or do not propose to advertise IT job vacancies on ATSCOjobs.com and/or is not a member of ATSCo Ltd;

(D) Apply dissimilar conditions to IT recruitment agencies advertising or wishing to advertise on ATSCOjobs.com and those not so advertising; or

(E) Apply dissimilar conditions to members of ATSCo and non-members of ATSCo;

(F) Engage in any conduct calculated to have effects which are the same as or similar to the effects of the conduct described in sub-paragraphs A to E above.

Rob Lewis, CEO of silicon.com said, "It is unacceptable for any company to believe it can abuse a dominant market position to prevent competition and innovation. Jobserve's position forced us to take legal action."

End document

In view of the decision of ATSCo to enter into the job site market UKTECH contacted the other Recruitment association the Recruitment and Employment Federation (REC). Chief Executive, Tim Nicholson stated they had no intention of starting a REC jobs board, "not our core business" he remarked.

We also called Rob Lewis of silicon.com for a short interview, he stated that a key objective of the "innovative" ATSCOjobs site was the fact that candidates registering on the site would be assured that any advertiser had met the strict standards set for membership of ATSCO.

"For the first time ever, agencies are signing up to strict standards of quality and professionalism which are increasingly needed in this marketplace. Users of the site will be assured that they will be treated with the professionalism and respect they deserve. We believe that this joint venture shows our commitment to the contractor market and will offer extremely valuable opportunities for both advertisers and potential candidates alike.." he stated.

ATSCOjobs will refuse any adverts from non ATSCO members. He did not accept that this was anti-competitive in the same way as Jobserve refusing adverts from ATSCO members. He accepted that ATSCO had the objective of driving up membership and ATSCOjobs would help achieve that aim.