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IBM Sues Top Executive to Stop Migration to Apple

IBM is suing one of its top executives, a server guru who is trying to take a job with Apple, where he would be working closely with CEO Steve Jobs.

Mark Papermaster, a 26-year veteran of IBM, has knowledge of "significant and highly confidential IBM trade secrets" that would "irreparably harm" the company if he is allowed to work for Apple, IBM alleges in a suit filed in United States District Court in Manhattan on Oct. 22. Papermaster also signed a noncompetition agreement in 2006 pledging not to work for competitors for one year after the conclusion of his employment with IBM.

The complaint says Papermaster was IBM's top expert for its Power microprocessors and the vice president of IBM's blade server development unit, until resigning on Oct. 21. Papermaster is also a member of IBM's "elite" Integration & Values Team, a group of 300 senior managers charged with developing corporate strategy.

"Recently, Mr. Papermaster informed his superiors at IBM that he intended to accept a position at Apple," IBM's complaint states. "On information and belief, Mr. Papermaster will become a senior executive and corporate officer at Apple and will work very closely with Apple's Chief Executive Officer in providing to Apple technical and strategic advice on a variety of issues."

IBM says it tried to lure Papermaster back with a substantial pay raise, and offered to pay him one year's salary in exchange for Papermaster "refrain[ing] from working for an IBM competitor for one year."

Papermaster nonetheless decided to leave and work for Apple beginning in November, the complaint states.

"Mr. Papermaster, as long as he is employed by Apple, will inevitably use and/or disclose IBM trade secrets for his own benefit and for the benefit of Apple," IBM alleges.

IBM is seeking an injunction preventing Papermaster from working for Apple and asks for monetary awards "as the court deems just and proper."

Full post as published by Womble Trade Secrets Blog on October 31, 2008 (boomark / email).