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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."
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.
That makes no sense. As an employee, why should I be punished if the stock goes below the strike price? Options are a poor incentive to compensate for being unemployable for two or more years.
Unless they can provide him with a job, or some other way for him to make a living. I don't see it right if they prevent him from finding another job.
However if he does know 'top-secret' stuff, and spills the beans to Western, Seagate will have a case against him, and Western Digital
Error 407 - No creative sig found
Especially one for 2 years? Seagate is probably just trying to stall it out, because they really don't have a chance in hell of making it stick.
It's called freedom,people.Or did it vanish when greed appear?
If all of Seagate's technology is protected by patents anyway, where's the problem? If he uses any of their super-secret hard drive technology, they can file patent infringement suits. That's what the patent system is for.
This absolutely is a standard practice in the industry. Often however, this is overlooked unless the employee who has been poached by a competitor is particularly valuable or had access to sensitive data such as strategy. I have certainly had employees sign non-compete agreements (for a couple of companies not necessarily in the technology industry).
Visit Jonesblog and say hello.
So what if he goes to another state to work for WD? What is a Minnesota court going to do about it then?
Employers can demand that you sign a non-compete contract when you leave the company, as well
And what are they gonna do if you don't - fire you?
As Moofie said, they can demand anything they want - it doesn't mean they'll get it.
The article says nothing about a non-compete agreement. All it says is that Seagate claims that the employee knows too much and that he will "inevitably disclose some of that proprietary information".
Why would Wendy's spy on McDonalds? Everyone knows that Wendy's makes, by far, the superior fries. Now, Burger King might look to McDonalds, because they haven't made a good fry in recent memory.
There simply isn't enough information presented in the story as to whether the parties on either side have broken any laws or behaved unethically. It is possible that legally you may be prevented from taking a job with a competitor. Whether that is the case depends in no small part upon what the laws are in your state and what contract you signed when you began employment. It's entirely possible that legally and ethically he cannot take a job with his competitor (at least for a limited time). It is also entirely possible that he can and should be allowed to. Given the scanty information provided, it's simply not possible to decide.
There is much pleasure to be gained in useless knowledge.
From the article: "This particular employee, who has been here for a very long time, has extensive knowledge of proprietary and confidential information," said Brian Ziel, a Seagate spokesman. "We believe he will inevitably disclose some of that proprietary information that he has gained through working at Seagate."
Technology always leaves us with these fascinating situations. In the Good Old Days(tm), an apprentice would work under a master for a number of years. When he left, what he had learned was known as "experience".
Now, it seems to me the company is claiming this man's knowledge as corporate property. By denying him the right to seek employment elsewhere, they are effectively saying that not just the patented information this man knows is the company's, byut also, that the thinking processes and hands-on experience that come with 17 years of work in some way belong to the company as well. Which is utterly ridiculous.
If he was stupid enough to sign a non-compete, then he's probably stuck. But to claim that every method this man could use is proprietary to Seagate is stupid. Really, really stupid.
It's not what you know, or even who you know- It's how many people recognize your damn
So... someone who's spent the last however many years designing new hard drive technology is supposed to throw that experience away and get a job at McDonalds or something for the next two years?
Why don't you just all sign yourselves into voluntary slavery. Oh sorry, it seems that you already have...
Since when has it been UnAmerican to be screwed by your employer? Being unable to get work and unable to get access to health care because a corporation's interests come above your own is as American as it gets.
Doesn't it make you feel good to know that our freedoms are protected by politicans, lawyers and journalists.
The don't prevent a worker from working in general. The worker is free to take a job that doesn't compete with the original.
I have a real hard time believing this. I don't know what legal right they would have to "demand" that you sign a contract that you don't want to. Heavy-duty pressure, maybe -- legally binding demand, I doubt it.
I could understand an interpretation of the law that could allow them to prevent you from giving away certain information, or maybe even using certain knowledge, but if that's what the law says then they would have no reason to make you sign a contract.
As a side note, as far as I know a contract MUST provide a benefit to both parties. In other words, a typical binding contract will be along the lines of, "In exchange for ___, I agree to ____." In a contract signed before employment, one would agree to certain things in exchange for being given the job.
If you have more details about your claim, I'd be interested to hear them.
Evil is the money of root.
Seagate only needs to pay him up front the two years salary Western digital was promising him and he can then stay at home and do nothing.
Otherwise, he should go work for the competitor, anything else bars him from earning a living in his field of expertise for two years, and it CANNOT be legal to make someone either starve or work in a field they don't want to work in. No contract can be made that damages an individual right like that, it's unconstituional.
Simple, really.
I don't know the meaning of the word 'don't' - J
Like it or not, as the parent poster said, non-compete agreements have held up in court many times.
You speak of selling yourself into slavery... I agree it is a trade off, but it is an agreement that one willingly makes. If you do not like the prospect of one, then work where they aren't required... and yes, last I checked, McDonalds is always hiring!
An interesting aspect of non-competes is that an employer may require your signature on one as a condition of employment or continued employment.
So even you could receive the question, "Want the job? Then sign, if not, leave."
Help Brendan pay off his student loans
They can't keep him from doing CAD work period. They can only keep him from doing CAD work for one of their direct competitors, and generally (not always) the non-compete also specifies "in the area they worked in for [insert the company name here]". I had to sign one for my current job, and I read it *very* carefully before putting my pen to paper. If you aren't willing to work for a company that requires one, then find a different job.
to shove it. Basically I went through the whole contract and crossed out all the instances of the word indirect as it referred to competition. I mean really that just sounded to me like: You have a fruit stand going and you only sell apples. I set up a fruit stand nearby and I only sell oranges. Your business starts delining so you sue me. I don't think so. And they tried telling me 'All the big companies have these, they are standard just like Microsoft'. LOL Yeah.. Like that is gonna convince me. Argh. These companies only want idiotic employees, and it appears they have, in many instances, gotten thier wishes. The really galling part was this was merely a tech support job for a company that made a living producing VBX plugins.
OTOH since I didn't sign eventually a friend I'd gotten hired at thier fulfillment house took the job and he still works there to this day. He's fat and happy and just about to graduate college, and I'm homeless. The price we pay for our principles can be stiff. Nevertheless if more people would question these BS NDAs that offer all the advantages to an employer and no compensation to an employee, and people keep saying shit like 'Thats just how it is, and you can't fight a big corp' it is NEVER gonna change. You have given up before you even fought the first battle. If a company really respects and values you as a potential employee they will back down on that NDA BS I bet. Just let a few people they really need demand full wages for the term to the NDAs prevention against them for finding other employment.
Lastly, I think it would have been much more responsible of them in light of this quote - "This particular employee, who has been here for a very long time, has extensive knowledge of proprietary and confidential information," said Brian Ziel, a Seagate spokesman. "We believe he will inevitably disclose some of that proprietary information that he has gained through working at Seagate." - to at least give the guy benefit of the doubt. I mean, if in fact thier worst fears become realized they'll be entitled to sue for WAY MORE money.
Bottom Line for me: I'll NEVER buy Seagate products again. I hope some will join me in protest.
-taosk8r
"The don't prevent a worker from working in general. The worker is free to take a job that doesn't compete with the original."
Glad I'm not a specialist.
"Derp de derp."
If you aren't willing to work for a company that requires one, then find a different job.
Not exactly possible in today's job market. It comes down to "sign this overly-restrictive document of potential forced unemployment or starve in the rain".
What evidence do you have that this employee is using Seagate's IP as leverage? Isn't it more likely that he simply no longer wants to work at Seagate but still wants to work in his field? After all, Western Digital couldn't legally use any of the IP that this employee brought over anyway.
In my opinion, a company should be able to make the non-compete time as long as they want, provided they pay you fair market rates during this time. If that is too costly to the company, fine... let the ex-employee work for someone else.
You inevitably learn things while employed. While it would be morally wrong to take trade secrets from one employer to another, it is not morally wrong to take your experience. After all, that's the reason you hire people who have worked in the field rather than people fresh out of school.
If this employee's knowledge is that valuable, Seagate should have no problem paying him during the two year non-compete. Alternatively, they should allow him to work in his field and sue the pants off of Western Digital if the trade secrets suddenly appear in future products from WD.
Oceania has always been at war with Eastasia.
He signed a non-disclosure agreement, not a non-compete agreement. If he'd signed a non-compete, Seagate is entirely in the right here. With just an NDA, though, the burden's on Seagate. Without a non-compete, they can't prohibit him from working for WD period. All they can do (and it sounds like what they are doing) is claiming that if he works for WD then violation of the NDA is inevitable. The burden's on them to demonstrate that, but that may not help him.
In today's economy, I don't see how noncompetes would hold up in court. They were probably useful in 1998-2000 dot-com boom times.
Seriously people have to make a living. The judge can't tell you to not use your skills to feed your damn family. The case would have to be super convincing like copying codes line by line. Even that isn't easy for ex-companies to come after you. Look at SCO.
If the engineer either was stupid enough to agree with the clause
It's not always a matter of being "stupid" enough to sign such agreements. They are very, very common now. It is pretty much impossible to get a technical job that doesn't have such an agreement. Refusing to sign it means you can't work in your field at all.
I have never bought in to this concept of "anything you sign should be enforceable." There ARE laws which regulate what sorts of contract clauses are and are not enforceable, and in my opinion, this one should never be enforceable.
If the next company that hires you is foolish enough to fabricate a product that too closely resembles patented, copyrighted, or trademarked items from your prior company, they will simply have to resolve it through various legal means. Those companies that rely of "trade secret" rules fear this sort of thing as they have little protection against the migration of knowledge from one company to another.
Everyone has the right to work, and it is not likely that any jury would see stopping a citizen from working as a viable solution. And, if they did, the Supreme Court sure wouldn't as it clearly wouldn't stand a test against the Constitution.
= 9J =
Why not? Why shouldn't private parties be allowed to enter freely into contracts, and be allowed judical recourse to enforce them? Developed economies' success centers around contracts and their enforcability. Without contracts, there is chaos.
The height of dishonesty is people who sign contracts that contain clauses they disagree with with the attidude "its unenforcable, so why do I care." If you don't agree with the contract and agree to abide by its terms, don't sign it.
By the way, I am in a technical field, in a senior position, and I did refuse to sign the non-compete. My reason? Nothing about it appeared in my offer letter, they sprung it on me during the orientation process. So, I didn't sign, and said that it was never part of my employment agreement. They never agreed with my point, but didn't fire me (which they knew would land them on the wrong end of a wrongful termination suit, since the non-compete was never mentioned in my offer letter), and the whole matter dropped (over a year ago).
Sarcasm and hyperbole are the final refuges for weak minds
Jiffylube does the same shit, believe it or not. If you invent a faster way of changing oil and you are an employee of Jiffylube at the time, they will claim ownership of it. Jiffylube, for those of you who don't know, is one of those 15 minute oil-change garages that hires mostly highschool-level wanna-be mechanics. Seems kind of on the border of "we own you 24/7 while under the employ of JiffyLube". Seriously, if a company tried to claim ownership of anything I invented on my own watch, they'd be at the bottom of a lake by the morning.
Slashdot is proof that Sturgeon's Law applies to mankind.
This is so commonplace it's not even funny. In fact, under my current employment agreement, I have the normal "no new in two" for a competing business, but I also have a stipulation that says I cannot recruit any current employee for any business opportunity of my own during those two years. Nothing to see here...
Mr. Goglia should just outsource himself to India - plenty of job offers will then come his way, without all this complicated lawyerly stuff.
IANAL, but I thought that the ruling is California was that unless Company A (Seagate in this case) fairly compensates you for not practicing your trade for the duration of the non compete, then the non compete won't hold up in court preventing you from going to company B.
Simpler, Seagate has to have him under contract, and has to be compensating him for the duration of that contract as specified in the non compete. Otherwise, they can't stop him from practicing his trade unless they can PROVE that he is using Seagates IP at his new position.
Because one party (the employer) is much more powerfull than the other (the employee), enough so to be able to force any kind of contract. The corporation can survive for a long time understaffed, but the employee cannot survive long without eating.
Consider this:
Suppose you've been to an accident and badly injured. There's a number of people around, and they offer to call an ambulance if you agree to be their slave. What will you do ? Not much choice here - you either become their slave or die.
Then, when Slashdot publishes a story, someone comments that "hey, he agreed to that contract freely, no one forced him, and if he thought it unfair he should have asked someone else for help !". Never mind the fact that no one else offered anything better...
Should this contract be enforced ?
Developed societies are based on the rule of law. If contracts take precedence over law, law has no meaning (because someone will always be strong enough to coerce others to sign). Therefore, a developed society cannot allow the stronger to oppress the weaker without any limits on the excuse that the stronger managed to force the weaker into signing a contract. To allow this to happen would be to switch the rule of law into the rule of strongest, which be a huge disbenefit to most members of the society (everyone but the rich and powerfull).
No matter how difficult this might to for some people to realize, the society does not exist to help them profit. It exists to protect it's members. This means the real people, not corporations. Therefore, it is the function of the society to protect the real human beings from the predations of corporate overlords, not to protect the profits of corporations by allowing them to prey on humans. Enforcing a non-compete deal means helping a corporation prey on human beings (its own employees) to protect its profits from its competitors, and is therefore unacceptable.
A government should always prefer real human beings over corporations or any other organizations. If it does not, then it is corrupt, and should be removed from office, by force if neccessary. Because the courts simply interpret the laws made by the government, having the courts pass decisions favoring corporations over humans is equal to having the government do so.
Economy exists to benefit the people, not the other way around.
The bottom of the cesspool are the people who use the weaker position of others to get them to agree on outrageous agreements just for a few dollars more, and then call them dishonest when they try to free themselves from this bondage.
Then you are either lucky that your employer is such and idiot that he didn't do things in the proper order, or unlucky that your employer is smart enough to realize that the courts will propably enforce a noncompete clause even if you didn't sign any. In either case you have no moral high ground to stand on and condemn those less lucky than you.
Forget magic. Any technology distinguishable from divine power is insufficiently advanced.
To reiterate that which you so cleverly dismiss with handwaving: In many technology fields you either sign a non-compete or you will not find a job in that field. For certain permium-paying technology fields this is standard operating procedure adopted by employers across the board.
Perhaps this is not an immediate or significant drawback when you are starting out post graduation but after specializing in a field for a number of years it is or more importance as you are only marketable at/near your current pay in an increasingly limited number of firms/positions.
Your options then are simple - sign the non-compete or be under or unemployed. When you have a family to support the choice becomes amazingly clear.
Noncompetes may have a place - and I say may because there are other ways that are less corp-friendly of handling the situation. When noncompetes become a standard for tech jobs (which they are for many areas) then it is time to call bullshit - the truth is that powerful corporations are forcing individuals into effectilvely one-sided contracts.
Unfortunately, the article doesn't go into too much depth about the situation. Whether he was fired, laid off, or left on his own for greener pastures. But here are my thoughts on it all:
Non-compete clauses are standard in the broadcast world, and a local radio station made a big stink about it on the air because a popular couple had been fired from their morning show, and the radio station that picked them up couldn't let them on the air for 6 months or face a lawsuit from the station that fired them in the first place! However, there are hundreds of markets in the US, and stations that are always looking for better talent, so there wasn't much threat of them going hungry - they could just move 50 miles to the next radio market and get a job if they were hard up for cash.
On the other hand, if what you do is highly specialized work, such as working on the read/write heads of hard drives, there aren't that many job opportunities available to you. So if there are only 3 companies that do what you specialize in, and you leave one to work at another, you are going to be in trouble if you are forced to take a 2 year hiatus. However, I wouldn't have a problem staying out of the field for 2 years if my first company compensated me for staying out of my chosen profession for the duration of time.
I haven't lost my mind!
It is backed up on disk...somewhere...
I wish I had a source here, but I'm pretty sure those contracts aren't enforcable in Canada. I heard about a non-compete clause that was contested a few years back by a former Nortel employee in Ottawa. The court ruled that you can't sign away your right to earn a living and nullified it. Maybe someone else knows more about that case?
If I had mod points, and comments could go higher than +5, I'd mod this up. I completely agree, that is how government should be. This particular day in age though, I fear it's too late, and much of the evils mentioned have already come true.
The problem is these corporations are made up of people. These people tend to be selfish, overbearing individuals who care for nothing more than short term profits and purchasing their 4th Mercedes SUV, despite the conditions of their fellow man. To further the problem, these people have used their fortune and power to influence government to protect their personal/corporate interests, on the basis of acquisition of wealth (via the farce of consumers hurting their business through illicit means, or in the case of this article, protecting their ever-so-precious IP).
Essentially, these corporate overlords have convinced the government that they are the threatened party, and that the commonfolk are the threat to their (both the corporate overlord and politician) respective positions, in a "I'll pick the fleas out of your hair if you scratch my back" type of bargain.
So the problem is, yes, economy exists to benefit the people, not the other way around. But the corporate suits have government convinced that they are the people, and anyone otherwise is a flea in the way of progress. I do agree 100% with everything you say, but I think the dark days of government are already here, between these types of noncompete agreements and bohemeths like the RIAA, SCO, and Disney throwing their weight around when thes of government are already here, between these types of noncompete agreements and bohemeths like the RIAA, SCO, and Disney throwing their weight around when they don't get theiy don't get their way, like Sauron with the Ring of Power, destroying anything in the path of conquest and profit. And yet, the more wealthy and powerful they grow, the more they'll crave, ad infinitum.
If he lives in a "Right to Work" state, then Seagate has no suit. In so-called RtW states, companies cannot prevent any worker from obtaining employment in their trained profession.
I believe the office he would have been working at is in the Boulder area in Colorado. I don't know if CO is a Right-to-Work state, but are there any CO residents who care to chime in?
if they claim ownership of the idea then you must have been on the clock 24/7, file for back overtime immediately.
Snowden and Manning are heroes.
No matter how difficult this might to for some people to realize, the society does not exist to help them profit. It exists to protect it's members.
Amen!
Wansu, th' chinese sailor
These contracts are legal, I believe, if and only if there is consideration for the signee. This would mean you would have to recieve compensation, or something, in exchange for you not working.
The contract as a whole is only valid if it is a mutual promise for valuable consideration, but this does not mean there must be a quid pro quo for each individual term of the contract. The consideration for a contract of employment consists only of the benefits that accrue to the employee generally, not of specific benefits for each obligation the employee is required to fulfil.
If they guy has been with them for 17 years then seagate must have not paid this guy enough for him to stick around. If this guy has been around this long and has all these trade secrets then it is some ones job at Seagate to keep this person fat, dumb and happy with his job. Since most jobs now are no like they were decades ago were a company would take care of its employees than these companies should expect the shoe fits on the other foot just as well.
I hope Pete gets to work at Western Digital very soon. I think Western Digital is one of the best companies out there as far as customer support is concerned. I had a bad 100gig drive that was about 6 month old and they replaced it with a 120gig drive. Not only that when I had further problem they shipped a second 120gig drive and told me to check them both out and return the extra 120gig drive in a couple of weeks when I was sure which one I would like to keep....all without a dime out of my pocket.
They have my business for life now.
Assuming Seagate has proprietary code or apparatus in it's harddrive, shouldn't Seagate have patents and copyrights that cover these inventions? If an ex-employee were to infringe on these patents and copyrights then Seagate could claim and injury and sue?
How much protection do large monolithic companies need? Usually corporations treat workers as-if they are insignificant, until they decide to leave. Not only do they want to own the thoughts of the employee, but also control where the employee works next. Somebody save us before we have to change our lastname to that of our employer as a condition of employment. Geeez.
and get a job at McDonalds or something for the next two years?
Um no you don't have to downgrade. I upgraded. I was in the technical service sector (2way radio, broadcast, satelite, consumer electronics repair). The shop has a non compete clause so I could not ditch them to work for the TV shop down the street. No probelm. I moved into R&D. I moved from a dying industry. (A $1200 VCR would get repaired. A $80 VCR gets replaced) I still use my technical skills. It's now on million dollar pieces of equipment, not sub $100 VCR's. I no longer deal with consumer electronics.
Look at related fields. A hard drive tech, could move to optical drives or removable media drives. With a solid electronics background, you could move into other insturmentation fields such as medical monitoring devices. There is no reason to work at McDee's just because you shoulden't work at another hard drive plant.
If your skill set is so limited, it's just hard drive technology, you need an education. A good electronics, physics, or engineering cource go a long way to marketable skills. Get a good base understanding, then specialize for the bucks, but be ready to change specialty in the same type of field, not the same specialty. A BS in electrical engineering is kinda wasted at McDee's. You can do better.
The truth shall set you free!