Non-compete clauses common in IT

Restraint of trade cases are common at the highest levels of the IT industry in the US.

There, restraint of trade is called non-compete, and two recent cases illustrate the seriousness with which employees jumping ship to competitors is regarded.See also: Account manager held to restraint of trade clauseLast year, former EMC executive David Donatelli left to work for Hewlett-Packard. He was the one taking the issue to court, filing a lawsuit asking a California court to negate his employment contract with EMC, which stated he couldn’t work for a competitor for a year after leaving EMC.

EMC filed a counter-suit, seeking to have the terms enforced. The matter was resolved when a court in Massachussets, where Donatelli lived, ruled that he could work for HP, but not in the storage filed where he had worked at EMC, for a year.

Donatelli possibly took the original case in California, home of much of the US high-tech industry, because non-compete clauses are more difficult to enforce there.

In a similar case, also last year, former IBM executive Mark Papermaster took a job running Apple’s iPod and iPhone engineering group.

IBM went to court to enforce the terms of an agreement it said prevented Papermaster working for rivals for a year after leaving IBM.

The case was settled with Papermaster refraining form working at Apple for six months, and being required, after starting, to sign declarations that he had not disclosed any confidential IBM information, nor intended to.

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