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Seagate Says Ex-Employee Can't Work For Competitor
deweller writes "According to a story at MacCentral, Hard drive maker Seagate Technology LLC is seeking a court injunction to prevent a former employee, Pete Goglia, from going to work for Western Digital Corp. any time in the next 2 years, saying Goglia knows too much about Seagate's hard-drive reading and writing technology to work for a competitor."
If Pete Goglia signed a non-compete agreement with Seagate then it has stipulations preventing him from working at a competitor for a specified time. It was an agreement he may have signed to work for the company. It is nothing uncommon in the US to have this kind of contract. Usually, the company will give you stock options and the if the stock options go below the strike price than you have to pay the difference in the current stock price if you break this agreement.
According to this article, he did sign something.
Uselessful technology (Air-Charged
In the UK such contractual clauses are explicitly null and void: it's called restraint of trade.
Bad analogies are like waxing a monkey with a rainbow.
Do they have a no-compete clause in his contract? If not, they're going to lose, as that's standard practice in cases like this.
And even if they do, its not clear what the legal standing of non-compete clauses is. It is state law that regulates the legality of non-compete clauses. For example here's a good page discussing the confusing situation in California.
Sailing over the event horizon
I know in Indiana they have what is known as "at will employment." While companies can make non-compete clauses, the employer can not make it stick.
My old company sort of worked around this. They had their customers sign "non-compete" clauses. We had a guy quit and apply for a posision at one of our customers. My old firm found out, sued the company, not the individual, and won.
I think they settled though, the company agreed to continue purchasing a support contact for XX years (i.e. to show that they weren't hiring this guy to replace their contract.)
Don't know if CA is "at will" or not *shrug*
Probably, unless he signed a non-compete, about all Seagate can do is is cost him a bundle in legal fees. (Hopefully WD will cover those fees.)
However, that could depend on the state laws. I was surprised by how different things were between California, my home state, and Georgia, where I am now. Interestingly, both states call themselves "Right To Work" states. In California, that means that an employer can't prevent you from working for another employer later; non-competes in that state are not binding. In California, you do indeed have the right to work, and no prior employer can restrict that right.
In Georgia, on the other hand, things are quite different. Here, from what I learned through the grapevine, the employer seems to hold most of the cards, and has most of the rights. You can be terminated at any time for any reason, or for no reason at all, and you have no recourse. Even so, you can still be held to a noncompete. This, apparently, is supposed to encourage employment, and thus they call this the "Right to Work". I think that's an AMAZING display of spin. In English, this Southern euphemism translates to "Right to Bend Over".
Moral: if you don't want to be held to a noncompete, make sure to sign it in California and make sure that your next job is also in California. Unless something has changed in the last two or three years, all they can do to you there is rattle their sabers a bit.
I know in California, except for very limited circrumstances, these contracts are indeed unenforceable. Specifically, I refer to:
CAL. BUS. & PROF. 16600 "Except as provided in this chapter, every contract by which anyone is restrained from engaging in a lawful profession, trade, or business of any kind is to that extent void."
Canada too. I went through this at one point where I was working for a contracting company and decided to move to another. First tried to scare me out of it but I lawyered up. They dropped it.
From what I read from the article and from what I remember about signing my previous non-compete agreeement with Seagate (if his was worded the same way), they aren't trying to prevent him from working at Western Digital, just the read/write head division of WD. The way I understood the clause and had it explained to me was that you can't go to work for a competitor and work on the same exact thing you were working on at Seagate. So I don't think they would have a problem with it if he went and worked for WD in some other division, say firmware development or testing.
I think WD should hire him and put him somewhere else for the two years, then move him over to read/write if they want. I think it's fairly reasonable that Seagate wouldn't want him working on the same stuff he was doing for them just a few weeks ago. It's almost impossible to expect that at least some confidential information won't be disclosed.
I belive a non-compete clause, such as ones alluded to here, exist in a number of industries. Speaking as a physician and member of the medical community, most of our contracts have non-compete clauses that state, in effect, "Upon leaving The Practice, you will not practice within your specialty in a similar hospital/clinic located within 5 miles of any of The Practice's locations". Of course, in this field it's so as not to "steal" patients (and therefor business) rather than technology.
No man's an island, unless he's had too much to drink and wets the bed.
In the UK such contractual clauses are explicitly null and void: it's called restraint of trade
You are completely and utterly wrong. The circumstances in the UK are similar to most of the rest of the western modern world: appropriately scoped non-compete agreements are allowable and enforceable. What "appropriatley scoped" means all depends upon the circumstances and nature of the work, but for R&D employees working on new technologies, 12 months is not uncommon.
Back in those days, Borland went after Microsoft, not the little guy.
Is this a differce in the times, or are the specifics of the situations different?
I believe one of the requirements for a valid CA non-compete is the specific listing of the companie(s) you agree not to seek employment with. A self-restraining order, in effect.
Often wrong but never in doubt.
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The parent's article points out two facts glazed over in the original one: 1) He did sign an NDA and 2) Seagate isn't try to keep him from working at WD altogether, just certain divisions.
I think it's fairly reasonable for Seagate to ask that he not work in the same division at another company that he just left at Seagate. I still can't tell from the article if he signed a non-compete clause. Also, when I signed my non-compete with Seagate, the term on it was 1 yr. (of course, I was just a lowly intern, so I don't think they would have cared one way or another)
There was Cowboy Neal at the wheel of a bus to never-ever land.