Apple Exec Hired From IBM Ordered to Stop Work – News and Analysis by PC Magazine
Posted on: November 9, 2008
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A U.S. District court has ordered an Apple employee recently hired away from IBM to immediately stop work amidst fears that he might disclose IBM trade secrets.
Mark Papermaster “will immediately cease his employment with Apple Inc. until further order of this court,” according to a Friday ruling from the U.S. District Court for Southern New York.
Apple announced Tuesday that Papermaster will serve as its new senior vice president of devices hardware engineering, replacing iPod innovator Tony Fadell.
Apple did not immediately respond to a request for comment.
Papermaster is a 26-year veteran of IBM and most recently served as vice president of IBM’s blade development unit, which designs IBM’s blade-model servers. In June 2006, Papermaster signed a non-compete agreement in which he agreed not to work for an IBM competitor for at least a year if he ever left IBM, according to court documents.
He informed IBM of the Apple job offer last month. On October 20, IBM offered him a pay raise as well as the option to accept one year’s salary if he promised not to go to a competitor, but Papermaster submitted his resignation the next day.
On October 22, IBM filed suit.
Papermaster 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,” according to IBM’s complaint.
Apple competes with IBM in the sale of servers, personal computers, and microprocessors, including Apple’s Xservers and Apple’s recent acquisition of California-based semiconductor company P.A. Semi, according to IBM.
IBM contends that Apple will use Papermaster and its stake in P.A. Semi “to design microprocessors for incorporation in a variety of electronic devices, including handheld devices.”
“IBM will be irreparably damaged” if Papermaster works for Apple and “inevitably” discloses trade secrets, IBM said.
That is “absurd,” according to Papermaster’s rebuttal.
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