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Update: judge orders Apple's new mobile head to stop work - Page 2

post #41 of 75
Quote:
Originally Posted by ouragan View Post

Apple would have you believe that breaking a non-competition agreement does not carry any consequence whatsoever. If the law was like that, why would anyone enter into such an agreement and pay good money for it?

The non-competition agreement is valid for one year only and was signed in return for the salary, bonus, stock options, health insurance, pension, severance payment equal to one year of salary, and other valid considerations paid by IBM to its employee.

Exclusive jurisdiction is given to the Court of the County of Westchester, State of New York. The law of California and the Courts of California have no jurisdiction over this matter.

The non-competition agreement is standard and reasonable because its duration is limited to one year and the employee is paid a salary or other compensation by IBM for the whole duration of the period of non-competition.

The intertlocutory injunction will stand.


We are also not getting the full story from Apple in another regard. Steve Jobs admitted in an interview that the PA Semi acquisition was based on the desire to build custom processors for the iPod and iPhone. Papermaster's hiring makes sense in the context that he will be overseeing iPod/iPhone hardware design and more specifically microprocessor design.

Despite the claims that IBM is not in the consumer electronics space, it's processors are in the PS3, Xbox and Wii.
post #42 of 75
Boo to IBM, if Papermaster did breach the contract then sue him, else don't. Besides, the current iPod and iTouch doesn't use PPC architecture, why is IBM so worried, it will take Apple a couple of years to develop its own processor and architecture for iPod and iTouch.
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post #43 of 75
Quote:
Originally Posted by ouragan View Post

Apple would have you believe that breaking a non-competition agreement does not carry any consequence whatsoever. If the law was like that, why would anyone enter into such an agreement and pay good money for it?

That's not what Apple is claiming. I'm sure his new contract has a similar clause. They are claiming that in his new position, he is not competing with IBM, so he's not violating the clause. If non-competes said that you couldn't work anywhere in the technology sector for a year, I think more courts would rule them non-enforceable.

Quote:
The non-competition agreement is valid for one year only and was signed in return for the salary, bonus, stock options, health insurance, pension, severance payment equal to one year of salary, and other valid considerations paid by IBM to its employee.

A claim could be made that all jobs at this level carry with them a non-compete clause, so unless he wanted to get a low-level job, he really had to sign the non-compete and didn't have a choice. I'm sure a lawyer can make this claim, but I don't think it will stand.

Quote:
Exclusive jurisdiction is given to the Court of the County of Westchester, State of New York. The law of California and the Courts of California have no jurisdiction over this matter.

The non-competition agreement is standard and reasonable because its duration is limited to one year and the employee is paid a salary or other compensation by IBM for the whole duration of the period of non-competition.

I think he's not paid specifically for that year. The idea is that IBM had to pay him more (in his regular salary) for him to agree to sign a contract that has this clause. Either way, that is why such a contract is usually accepted.

When companies tried to enforce such a clause on all levels or R&D, or to make it cover a too broad definition of "compete", such agreements were thrown out by the courts.

Quote:
The intertlocutory injunction will stand.


I believe that is correct.
post #44 of 75
Quote:
Originally Posted by zinfella View Post

Some non-competes are of a longer duration. When Lucky Stores in Arizona were sold to ABCO, there was a 5 year non-compete clause in place for Lucky not to compete in Arizona.

Sure, but that is different. Corporations may sign away many more "rights" than individuals can. A corporation might even be able to promise non-competition forever.
post #45 of 75
Quote:
Originally Posted by Inverse137 View Post

Dueces, because idiot lawyers told the buisness' owners that non-compete contracts were enforceable.

Looks like the idiot lawyers were right

Quote:
Most people sign them with a wink-wink-nod-nod reluctance. Most states don't recognize them because the consequence of recognizing a non-compete clause is to deprive a person of the right to make a living. That FUNDAMENTAL right is guaranteed to you by the U.S. Constitution.

Fundamental, yes, but is depriving you from working for a competitor for 1 year bad enough to be a breach of your rights? It's just one year. If so, how about the clause in many job contracts that you can't have any other job at the same time as this job? Is that also infringing on your fundamental rights?

Quote:
Although, by your post, I'm guessing you are a fan of George Jr. and see the Constitution more as a guideline that can be ignored when it suits your needs.

The only legal leg IBM has is defending the patents it holds if they were ever infringed upon. They have no prayer of keeping this dude from working.

Apparently, they have.
post #46 of 75
Quote:
Originally Posted by TheMadMilkman View Post

You act like it's already been determined that his work at Apple violates the non-compete agreement. I'd like to know how you can be so sure on an issue of fact like that before the trial occurs.

Trial? What trial? There's never going to be any trial.

With two companies the size of Apple and IBM, by the time they get through discovery and pre-trial motions and mandatory arbitration and what-not, the 1 year period will be over and Mr. Papermaster will be able to work for Apple at whatever job.

At best we're going to have a hearing with Apple asking to lift the order.
post #47 of 75
weelll that totallyyy sucks. =(
Apple had me at scrolling
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Apple had me at scrolling
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post #48 of 75
Quote:
Originally Posted by Johnny Mozzarella View Post

Despite the claims that IBM is not in the consumer electronics space, it's processors are in the PS3, Xbox and Wii.

I wonder what Apple will eventually use in their Apple TV device. They surely can't keep the Toasty Pentium:

http://www.youtube.com/watch?v=7Cf3m_YUzCM

I guess in some way the Apple TV competes with the consoles. The primary function isn't gaming though. Although the consoles have media center functionality, it is not their main selling point. If the Apple TV moved up to gaming then maybe but I reckon they'd stick to lower powered ARM again.

As an aside, here are some other ads I found. I don't think I've seen the Mr Bean one before:

http://www.youtube.com/watch?v=VA1XPTsUGDo
http://www.youtube.com/watch?v=Jge_X5joVtc
http://www.youtube.com/watch?v=8HhncO6w4Pc
post #49 of 75
For comedy value, Apple should tell IBM they were going to offer him a salary of say....US$40,000,000 per year, but that if IBM themselves are willing to pay that to stop him working at Apple, they can have him sit at home in front of Judge Judy instead.
post #50 of 75
Papermaster should have gone to Pixar for a year. Special advisor to Steve Jobs.

Many of the most important software concepts were invented in the 70s and forgotten in the 80s.

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Many of the most important software concepts were invented in the 70s and forgotten in the 80s.

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post #51 of 75
Let this be a lesson for everyone. If you decide one day all willy-nilly to go work for IBM, make sure your contract lists you as a "weekend janitor".
post #52 of 75
Quote:
Originally Posted by trevorlsciact View Post

why is it that contracts like this are legal?! this is just one step away from indentured servitude

Oh, please. Anytime somebody brings that up, it makes him look silly. You're rolling eyes without fully understanding the situation.

Papermaster can leave IBM. He can work. He just can't do anything similar to what he used to do for a period of one year. Since companies like IBM depend heavily on intellectual property, it's fair for them to do what they can to protect that IP. In a year, most of what he knew about IBM's plans and R&D will be obsolete and he can do whatever he wants for Apple. In the meantime, he has plenty of spare time to keep up with what other companies are doing in the field, so he can be up to speed immediately when he does start work for Apple. He's getting paid. He's not taking unemployment or welfare, on the verge of foreclosure or otherwise in dire financial straits. So just let it go.
post #53 of 75
Cringely wrote about this a couple days ago. I agree with his assesment that Apple will probably agree to buy product from IBM to make this go away if it's holding Apple back. I also agree that Papermaster's officel new title has nothing to do what he was hired for.

PS: I tried to post the link, but without copy/paste I had to type if out, which meant going back and forth between mobileSafari windows, which meant a crash. If you read his article, note their are two, one is text and the other is audio. It seems to be confusing some readers.
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post #54 of 75
Quote:
Originally Posted by Kolchak View Post

Oh, please. Anytime somebody brings that up, it makes him look silly. You're rolling eyes without fully understanding the situation.

Papermaster can leave IBM. He can work. He just can't do anything similar to what he used to do for a period of one year. Since companies like IBM depend heavily on intellectual property, it's fair for them to do what they can to protect that IP. In a year, most of what he knew about IBM's plans and R&D will be obsolete and he can do whatever he wants for Apple. In the meantime, he has plenty of spare time to keep up with what other companies are doing in the field, so he can be up to speed immediately when he does start work for Apple. He's getting paid. He's not taking unemployment or welfare, on the verge of foreclosure or otherwise in dire financial straits. So just let it go.

Up until a month ago, Apple prevented iPhone developers from talking to each other in order to protect their intellectual property; I would have thought the Mac community would be a little more understanding of IBM's position.
post #55 of 75
Quote:
Originally Posted by aplnub View Post

I doubt anyone held a gun to Papermaster's head when he signed the contract. So the better question is, why do people sign these things?

Ah, a voice of reason. IBM has a policy to protect the company's shareholders from losing value when a key employee is given the keys to the kingdom, the recipe for the secret sauce.

It is that employee's decision whether or not to place his or her signature on that contract and in effect, agree with IBM's policy.

Papermaster could have just as easily said, "thanks but no thanks," and walked away. But he didn't.

And kudos to Apple for working so hard to uphold their legal mumbo-jumbo policy vs Pystar while they work so hard to disassemble IBM's. Corporate America. It's all about who you're sleeping with at the time, eh?
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post #56 of 75
I can understand if an employer is allowed to sue you if you leak confidential information about the company while you're working for them or states you can't work for a competitor while you're still employed. Though for the court system to be used to force you to stay with only one employer for the rest of your life should be considered slavery and the American legal system should be ashamed of they way they handled this case. I would be pissed if I was this guy being told he only has the option of being unemployed or working for IBM for the rest of his life. Whatever happened to building your on the job skills and taking those skills somewhere else due to needing to relocate for a move or wanting to increase your salary when your employer is unable or unwilling to meet your needs?
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post #57 of 75
Don't be surprised if that big shot lawyer Apple hired last year is luring IBM into an intellectual property rights dispute that Apple would happily lose in a higher court. Then for the next ten years Apple can hide behind the court's decision when they spring the really good stuff. Brilliant!!!!!

Apple's approach to this snatch and grab from IBM seems to careless to be believable.
post #58 of 75
I would doubt that there is a single Fortune 500 company that doesn't have their management, especially those in R&D, Market/Planning and Financance/New Product Development contracted without a non-compete clause.

Certainly, shareholders in particular would be highly hesitant knowing that top R&D personnel could simply walk out the door and go across the street to the competition at a drop of the hat.

Heck, "Non-compete clauses are everywhere from restaurants and their chefs to basketball teams and their coaches."* Probably the biggest corporations that are very tight on NCC and NDA are those that do contract work for the Federal Government, especially defence contractors. And even the Feds themselves have a similar and even more binding agreements which are virtually holding for the rest of one's life.

What IBM is doing here is simply ensuring that its (company and shareholders) property rights are being protected. Papermaster got an offer he couldn't or didn't want to refuse. Apple did nothing wrong by offering the position. Surely Apple understands and agrees to the principle of NCC's as they themselves employ their use. As such, Papermaster's employment from IBM to Apple would be conditional. However, it should be noted that Papermaster may have forgotten his commitment (as it was a long time ago) or his understanding of it did not appear to conflict with the position he was being hired for. In either case, it was simply decided to let the ball fall were it may, and if need be, let the courts decide it a foul was committed.

For those who are in the position to have to sign a NCC, the rewards for doing so virtually keeps them out of the poor house. This does not fall in the realm of servitude or "you can't keep me from enjoying a livelihood." However, the treatment of such depends on where you are, the conditions it covered and the intent to which the move is being made in the first place.

Here is a good site to help explain Non Competition Agreements.†

"We have all heard urban myths - crocodiles attacking people in sewers; Jimmy Hoffa buried under Giants' Stadium in New Jersey. They sound real, but they are not. The distribution industry has such an urban myth. The myth is that non-compete clauses in manufacturers' representatives' contracts can be ignored because they do not mean anything. That statement is false. In almost every state, a tightly drawn non-competition agreement will be enforced by the courts. Even if the non-compete requirements are overly broad, the courts in many states will narrow them in order to enforce what the court feels is proper."

Perhaps this free article "Protect Trade Secrets from a Corporate Raid" will help to a better understanding. http://findarticles.com/p/articles/m...s_/ai_59579692

In any event, just wish that you get to be so presented with the opportunity. It can be a great negotiating tool. If they want you bad enough to consider your position that valuable, it obviously can raise the bar on all sides.

Another thing to consider. If you decide to dishonour your NCC, particularly if you were skipping to a major competitor and lied about it, just wonder how many companies would want to take a chance and hire you after that.

*http://virginianoncompete.blogspot.c...of-sports.html

http://findarticles.com/p/articles/m...g=content;col1
post #59 of 75
Turner and Bobby Newmark will get it sorted.
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post #60 of 75
Quote:
Originally Posted by Imagine Engine View Post

Though for the court system to be used to force you to stay with only one employer for the rest of your life should be considered slavery and the American legal system should be ashamed of they way they handled this case. I would be pissed if I was this guy being told he only has the option of being unemployed or working for IBM for the rest of his life.

Read the agreement. Or read the replies here. ONE YEAR. Okay? Not the rest of his life. And he's not unemployable. If Apple, Intel, AMD, Dell or whoever wants to put him in charge of anything but microprocessor design, he's free to take it right now.
post #61 of 75
I don't believe this is about IP at all. IBM arrogantly believed they had this guy, an elite member of the management team, for life. They took him for granted and were stunned and embarrassed when he resigned. They didn't know how to respond and even let him stay with unrestricted access for two weeks. They had stuck him with blade servers and this guy needs a challenge--he was ripe for the picking. IBM dropped the ball. Jobs showed him some things and issued the necessary challenge. They offered him a years salary to honor the one year term and he slapped them in the face and said NO. This is retaliation, vindictiveness and CYA. Maybe Steve Jobs greatest genius is recognizing talent-- Jony Ive, Ron Johnson, Tim Cook, those at Pixar et al. He gets the best people on his team. This all makes me think IBM is afraid of Apple.
post #62 of 75
I've read that he will get compensation for the year that he doesn't work.
post #63 of 75
He has worked for IBM for 26 years...When did he sign this contract? I have heard a lot of junk that he got extra salary and benefits for signing it as compensation...BS. He would not have had a job x years ago when he didnt sign it. There was no option for dont sign, but take a lesser salary, therefore his salary was what it was, there was no additional compensation and no choice. As to compensating him after the fact?...I thought they were trying to claw back compensation already promised.

Personally I think non-competes should have a 3-5 term and be non-renewable. No one should have to be chained to a company for life. How many of you out there can just take a year off work and not lose your house/car/ health insurance? If your tech is so SUPER valuable, just bite the bullet and pay the employee enough to keep them, or create a work environment that will make them want to stay.

To top it off, I still haven't seen anything that suggests these two companies are competitors. The only argument the haters (and there are tons of them for some reason) have come up with is cell processors. Apple is not going to try and swipe or clone a patented tech like that. They get sued for a billion, baselessly, when they look in the general direction of someone else's tech. Why would they open themselves up for a legitimate and massively lucrative lawsuit?
post #64 of 75
Quote:
Originally Posted by Imagine Engine View Post

I can understand if an employer is allowed to sue you if you leak confidential information about the company while you're working for them or states you can't work for a competitor while you're still employed. Though for the court system to be used to force you to stay with only one employer for the rest of your life should be considered slavery and the American legal system should be ashamed of they way they handled this case. I would be pissed if I was this guy being told he only has the option of being unemployed or working for IBM for the rest of his life. Whatever happened to building your on the job skills and taking those skills somewhere else due to needing to relocate for a move or wanting to increase your salary when your employer is unable or unwilling to meet your needs?

Every sentence in your blog is total BS and has nothing to do with what was presented to the court or the court's response.

Perhaps perusing through the actual court filings ( http://news.justia.com/cases/feature...v09078/334178/ ) might help you get the facts straight.

Unbelievable the amount of stupid and misquoted statements, dumb conclusions and trash talk being generated on this site.
post #65 of 75
Quote:
Originally Posted by mbene12 View Post

He has worked for IBM for 26 years...When did he sign this contract? I have heard a lot of junk that he got extra salary and benefits for signing it as compensation...BS. He would not have had a job x years ago when he didnt sign it. There was no option for dont sign, but take a lesser salary, therefore his salary was what it was, there was no additional compensation and no choice. As to compensating him after the fact?...I thought they were trying to claw back compensation already promised.

He probably signed the non-compete when he got to a certain level. If IBM tries to enforce this for low-level R&D people, the courts may very well throw it out.

Quote:
Personally I think non-competes should have a 3-5 term and be non-renewable. No one should have to be chained to a company for life. How many of you out there can just take a year off work and not lose your house/car/ health insurance? If your tech is so SUPER valuable, just bite the bullet and pay the employee enough to keep them, or create a work environment that will make them want to stay.

Non-competes for executives are not to cover training costs, but to prevent leakage of trade secrets. And employees leave all the time, for all kinds of reasons.

Quote:
To top it off, I still haven't seen anything that suggests these two companies are competitors. The only argument the haters (and there are tons of them for some reason) have come up with is cell processors. Apple is not going to try and swipe or clone a patented tech like that. They get sued for a billion, baselessly, when they look in the general direction of someone else's tech. Why would they open themselves up for a legitimate and massively lucrative lawsuit?

I agree that "compete" should be interpreted in the narrowest sense possible, as clauses such as this really do infringe on the right of individuals after the employer-employee relationship has terminated. But they do have their place.
post #66 of 75
I was subject to a three-month non-compete, which is worse than a one-year because it's hard to argue in favor of me working elsewhere because the plaintiff's basic argument is, "It's just three months."

Non-competes are terrible, terrible things. I believe they do more harm to the company that enforces it than that company realizes. Instead of insuring loyalty, the company creates an atmosphere of paranoia and bottled contempt. Employees who are on the cusp -- performing necessary work but not with the best attitude or reliability -- remain to collect salary and bonuses in exchange for at best on-par performance.

I'd love to see this Apple/IBM push upward through the legal system. These things have to stop being enforced.

Quote:
I agree that "compete" should be interpreted in the narrowest sense possible, as clauses such as this really do infringe on the right of individuals after the employer-employee relationship has terminated. But they do have their place.

synp, I read this after writing my post. Yes, if they must exist, "compete" needs to be more narrowly defined, but that's the problem. "Compete" is completely open to interpretation, and I would argue that most companies that use non-competes believe "compete" to mean any company in their industries and even narrowly connected to their industries.
post #67 of 75
Quote:
Originally Posted by markb View Post

This argument is lame. They might as well have said..."People at Apple breathe oxygen. We too breathe oxygen, therefore he cant go work there as they compete with us in the whole breathing area".

What? IBM (nor Apple) has any products related to breathing oxygen, so how is it the same?
post #68 of 75
Quote:
Originally Posted by Inverse137 View Post

the U.S. Constitution GUARANTEES a person the right to make a living. That supersedes any non-compete document.

And?
No one has said he cannot work at all.
He cannot work at Apple for the time being.
post #69 of 75
I should back up and say that my ultimate problem with non-competes is that they enable a company with money to spend on lawyers to bully employees without money to spend on lawyers. Non-competes can't be upheld, but few employees have the money to fight them. The contract is enforceable by means of war chest.
post #70 of 75
Quote:
Originally Posted by markb View Post

"Electronic devices large and small are powered by the same type of intelligence, the microprocessor," the New York state-based company insists.

This argument is lame. They might as well have said..."People at Apple breathe oxygen. We too breathe oxygen, therefore he cant go work there as they compete with us in the whole breathing area". IBM and Apple are in no way competitors and havent been since IBM sold off their notebook business. Heck, this guy was going into the consumer device sector, even further removed from IBMs realm. Hope justice is done on appeal.

IBM could really damage their position as a desirable place for employment with threats like this. The talented people will only go to work for smarter companies.

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post #71 of 75
Quote:
Originally Posted by Inverse137 View Post

the U.S. Constitution GUARANTEES a person the right to make a living. That supersedes any non-compete document.

unless IBM wants to pay this guy to sit home and watch Judge Judy they better quit wasting everyone's time.

This judge should know better.

Under what Amendment?

Noncompete clauses do not stop a person from making a living.
post #72 of 75
Quote:
Originally Posted by Abster2core View Post

Under what Amendment?

Noncompete clauses do not stop a person from making a living.

Really? The guy has 26 years working in the electronics industry. If any position in that industry is construed to be "competing", then he is stopped from making a living.

Sure he can get a job flipping burgers at McDonald's, but he should be forced to get such an unrelated job.

Non-competes do infringe on your rights, and so they should be narrowly interpreted to only cover the problem they are meant to solve. Papermaster may use any knowledge of electronics and business and marketing that he has gained at IBM, but may not use his actual knowledge of current IBM plans and projects to the advantage of a competitor. Unless his knowledge of current projects and plans could help Apple compete against IBM, he should not be prevented from working there.
post #73 of 75
Quote:
Originally Posted by synp View Post

Really? The guy has 26 years working in the electronics industry. If any position in that industry is construed to be "competing", then he is stopped from making a living.

Sure he can get a job flipping burgers at McDonald's, but he should be forced to get such an unrelated job.

Non-competes do infringe on your rights, and so they should be narrowly interpreted to only cover the problem they are meant to solve. Papermaster may use any knowledge of electronics and business and marketing that he has gained at IBM, but may not use his actual knowledge of current IBM plans and projects to the advantage of a competitor. Unless his knowledge of current projects and plans could help Apple compete against IBM, he should not be prevented from working there.

What rights?

For cripes sake, look at the Nature of Action, i.e., "IBM brings this action to preventwho is in possession of significant and highly-confidential IBM trade secrets and know-how, as well as highly sensitive information regarding business strategy and long-term opportunities" in the original filing,

Considering the scope of Papermaster's position and duty, IBM is just ensuring that his knowledge of the current business development and strategies are held in abeyance from a current or would-be competitor for one year. There is nothing nefarious here.

And for your edification, "Non-compete clauses are everywhere from restaurants and their chefs to basketball teams and their coaches." http://virginianoncompete.blogspot.c...of-sports.html

Again, non-compete clause are part of every major sports franchise, pharmaceutical companies, and automobile manufacturers, etc. Biggest user of all is the Federal Government agencies and its contractors. If you don't think that employees of Boeing, Lockheed, Northrop Grumman, etc., are immune to NCCs you need your head read. Apple understands it well. Afterall, they like most companies, employ NCCs routinely when contracting their top employees, manufacturers and outside agencies.
post #74 of 75
Quote:
Apple understands it well

If they know it so well and NCCs are so easily enforced then why is Apple hiring a guy they know has one hanging over his head? I guess they are just not as smart as you. Or, another possibility, they have a plan. I am not sayin Apple is infallible, but they have made very few missteps for the past several years. It would honestly shake my confidence in the company somewhat if they didnt put more thought into this hire. I mean its only for the guy that is going to be directing the development and planning of units that now account for >50% of their income.
post #75 of 75
Quote:
Originally Posted by markb View Post

If they know it so well and NCCs are so easily enforced then why is Apple hiring a guy they know has one hanging over his head? I guess they are just not as smart as you. Or, another possibility, they have a plan. I am not sayin Apple is infallible, but they have made very few missteps for the past several years. It would honestly shake my confidence in the company somewhat if they didnt put more thought into this hire. I mean its only for the guy that is going to be directing the development and planning of units that now account for >50% of their income.

You're way over-thinking this. Apple probably believed that the new job is far enough removed from IBM's business that IBM won't care and won't make a stink. As I've said in a previous post, this think is not going to trial. It's all about motions that will happen now or within the next few weeks.
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