Legal Arguments Can Hurt Tech Job Mobility

camelcai writes "Microsoft's suit against Kai-Fu Lee and Google is based off of the thought that in some circumstances people can't avoid sharing or relying on trade secrets from their former employer when moving to a competitor. In MS's filing it says: 'Lee's conduct threatens to disclose or Lee inevitably will disclose Microsoft's trade secrets to Google and/or others for his and/or Google's financial gain in the course of working to improve Google search products that compete with Microsoft, and in the course of establishing and building Google's presence in China to compete with Microsoft's efforts in China.' According to CNET, thanks to this increasingly popular legal argument, defectors might face a lawsuit even if they did not sign agreements not to compete or not to disclose confidential information."

Comments

Maybe Google gets the short end of this stick

[Tontoman]

" . . . though Microsoft says a document it found in the recycle bin of one of Lee's computers indicates Google anticipated a possible lawsuit in hiring Lee."
Which is worse?
1. Reading over competitor's job offers using company equipment? Or
2. forgetting to empty recycle bin and wiping disk before returning company computer?

Re:Maybe Google gets the short end of this stick

[Anonymous Coward]

Their argument is infuriating. Companies cannot be allowed to have that kind of power over individuals. That's like telling Randy Moss he has to play defence (or perhaps he can't play at all) in oakland because he played offence in minnesota. If you want to block Kai-Fu Lee from working for google, you should have to pay Lee an inconvenience fee for that veto because it isn't like Lee is the only person who wants to work for google. If you are going to block someone from taking one of the most sought after jobs in the IT world, you have to show Lee the money as compensation.

Did everyone hear that? Show Lee the money!!!

saltyDOTpeteATslackcrewDOTCOM

The new serfdom

[Black Parrot]

It's an easy way for a company to pwn its employees.

Re:The new serfdom

[mr i want to go home]

I was going to say essentially the same thing - it's not America doesn't practice capitalism, or democracy. The only game in town now is Feudalism.

It doesn't help that you might own or be paid stocks in a company - the miniscule amount or power you have compared to the largest shareholders doesn't translate to ownership at all. It's like the serf 'owning' his plot - sure, in a literal sense, he owns it. But he can't sell it, can't sell his produce to anyone else, and he sure can't move anywhere else. His whole life belongs to the Feudal lord, 21C, aka, Microsoft/etal.

I'm truly not trying to start a flame war, or be a troll, and I'm not the only one to think this. Kim Stanley Robertson paints a similar picture in the Mars trilogy. It's worth the read just to see a future vision of politics.

Scarey stuff.

Re:The new serfdom

[h4rm0ny]

You don't just have to look to the future for this - you can look to the past also. What we see existing in potential here are similar to the medieval guilds. European guilds in the middle ages were very protective of their areas of expertise and raised Hell for outsiders who dared to compete (assuming they got access to the knowledge and skills they needed in the first place).

The modern view of the guilds tends to be very critical - they stopped people earning a living unless they were members?"

However, it's very similar to the situation that this would logically lead to - locked into a profession; and Heaven help you if you loose your place in the organization because with this sort of legal precedent, the threat of being sacked from a corporation becomes even more powerful.


For those who are interested in the guilds in history, it might be worth noting the following:

• They began as business alliances that through their increasing wealth eventually brought into law their privelleged right to a monopoly on certain areas. Sounds familiar?
• They used their influence in Europe to choose local leaders, dissolve town councils that interfered with them, etc. Sound familiar?
• They were frequently criticised for interfering with free trade and innovation. Sound familiar?
• One of their best known critics was the arch-prince of Capitalism, Adam Smith. Well, Adam Smith is dead, but I believe he would have found modern corporate practices like this to be just as anti-capitalistic as the guilds.

Re:HURRICANE KATRINA IS ABOUT TO SLAUGHTER 1000'S!

[Draconix]

And you can't spell 'slaughter' without laughter!

Re:I beg your pardon?

[wbren]

'Lee's conduct threatens to disclose or Lee inevitably will disclose Microsoft's trade secrets to Google and/or others for his and/or Google's financial gain in the course of working to improve Google search products that compete with Microsoft, and in the course of establishing and building Google's presence in China to compete with Microsoft's efforts in China.'

Can someone translate this please?

Translation: All Your Base Are Belong To Us, Kai-Fu Lee.

Simple solution.

[khasim]

The old employer pays the person as much as the new employer was offering for a year (or however long the non-compete contract is) and puts up money equal to 10x that in case the new company doesn't want the employee after the year is up and he has to find a new job.

Anything less is indentured servitude (a form of slavery).

If the companies want to play that game, then they should be financially responsible.

Re:Simple solution.

[eric76]

That sounds like a great approach.

About 15 years ago, I knew one engineer at the Johnson Space Center area who accepted early retirement from IBM division there and accepted a job with another NASA contractor on a project that was not in competition with IBM. The terms of his early retirement agreement specified that he could not work for another company in competition with IBM.

IBM nixed that about two weeks after his retirement and before he started at the other job. Their reasoning was that they might want to bid on that contract later and he would then be violating the terms of his agreement.

A lawsuit with IBM to enforce his rights would have ended his retirement plan with IBM as well.

It really left him in a bind for quite a while.

A solution like yours would have helped him enormously.

Re:Simple solution.

[mrchaotica]

You don't get it, do you? This is voluntary for the company. They can choose to do this, or they can just let the guy work for the other company.

It's not "the employee demanding pay for no work," it's the employer demanding no work and the employee demanding not to starve to death!

Jennifer Government

[ObsessiveMathsFreak]

This reminds me of that novel Jennifer Government, where in the dystopian anarcho-capitalist future, companies can sue former employees for losses in productivity which might result from an employee leaving their job.

Here, we have a company suing over potential losses in intellectual property which might result an employee leaving their job.

You tell me which is more surreal.

The future, is.... now?

Whats good for the goose

[Timesprout]

Intresting that MS decide that inevitable disclosure is a problem when their employees leave given that it wasnt an issue when they poached/bribed a lot of the guys from Borland in the .NET ramp up.

Re:Whats good for the goose

[einhverfr]

Intresting that MS decide that inevitable disclosure is a problem when their employees leave given that it wasnt an issue when they poached/bribed a lot of the guys from Borland in the .NET ramp up.

And don't forget hiring the DEC VMS team to build NT....

Personally I don't think this will be such an issue. Courts have historically been reasonable about things like no-compete clauses and tended to try to protect employees from overextensions of these things.

Secondly, we live in a country where a person can sue another person for any reason. If a distinct claim is made according to law, it will become a matter for the trial. If not, it will be dismissed. If it goes to trial and there are sufficient disputed facts, it goes to a jury trial. If not, it usually ends up in summary judgement procedings (which are cheaper and more predictable than jury trials).

IANAL, and this is just my lay understanding. So don't believe anything I say :-)

Severance as long as non-disclosure?

[scattol]

Maybe it should be law that if a company wants to bind you to a long non-disclosure, it should also be forced to agree to a golden-parachute clause as long as the non-disclosure?

Say you work in search engine technology for Microsoft, how are you going to earn a nice living elsewhere? Afterall your skill is searches and that's what people are willing to pay for. Well if your employer wants to prevent you from earning a decent living, it should pay for it!

I am sure that there is a flaw in that argument, and I understand Microsoft's position in the matter but in these circumstances doesn't it make the employee a virtual slave of the employer if he can't use his skills elswhere?

Competing to trade with the devil

[ShatteredDream]

The Chinese government is the worst major government on Earth today. It's still a totalitarian government and an aggressive, would-be empire. It's amazing to me at times how much we are willing to do to build up their economy, only to have them eventually become a dominant military and trade empire in Asia, and possibly one day Europe as well.

When I think of how China treats the Tibetans and Uhigurs, I just can't believe that we let companies like Microsoft and Google trade with them. The scary part about this competition to build up their services in China is that regardless of which company wins, the Chinese government wins because its private and state-owned corporations get a much larger economy to profit from. That in turn goes into building up the military, which btw they are now making steady progress toward having a blue water navy in the pacific.

Re:Competing to trade with the devil

[BewireNomali]

It's like the US is damned both ways. In doing trade with them, we essentially enable and enbolden our replacement as a superpower. We ignore them, and our economy becomes an also ran as other economies enjoy the windfall of dealing with the sheer mass of their economy.

One can argue about a correlation between the health of an economy and the size of their urban centers, especially as far as consumer spending goes. China's urban centers alone stand at 300 million and counting. It's a fucking awesome mass of people just entering the first world economy. The Chinese are known to be excellent at saving cash; I read something about car companies salivating to get into the market because an overwhelming percentage of cars are purchased with cash (their banking system sucks, another chink in the armor).

I agree with all of the human rights concerns, etc., but they embody a critical mass that cannot be ignored.

someone posted something about them being unable to feed themselves. They can't power themselves either. I can imagine the war *cough* middle east destabilization efforts *cough* is a preemptive attempt to prevent consolidation and collusion efforts in the middle east with the chinese.

All in all, they can't be ignored. We're fucked both ways. I'm learning mandarin.

Oh, and to get on the topic: how is it possible that this Lee guy not ever disclose trade secrets. It's impossible. Not only that, but he's a well educated Chinese man who well serves as a frontman for a company attempting to woo the Chinese government into allowing them egress. There is so much more at stake with this lawsuit. If google establishes a significant foothold in that market, microsoft might be done. Wow. Like, they could really be done. A suite of server side applications for free, serving two billion people (their current penetration plus the chinese market) - OS agnostic. Then an OS like Linux can thrive - Google can even champion its own distribution - for free of course - that integrates all of its server side apps directly on a clean GUI - right on the desktop. It not only puts Microsoft in a quandary - but it wipes out a significant segment of the industry in one fell swoop. It's the commoditization of software - and a monopoly on information and the potential for relationships. Shit.

Guess that money spent on PHDs was well spent.

Sorry for the ramble.

Don't work for companies like Microsoft

[Anonymous Coward]

This is why people should not work for companies like Microsoft. If you think they screw with their customers, imagine how they treat their own employees.

I was a juror...

[ninejaguar]

...in a lawsuit in California where a company sued its former president for taking two key employees with him and starting a competing company. I don't believe any of them signed an agreement not to compete or disclose trade secrets; at least I don't think the two employees did (they were being sued too). Maybe the ex-president did. It didn't matter. You can't stop people from working in California, no matter what they have in their heads. I'm not sure about the rest of the United States.

I'm of the opinion that what is in your head is yours, and makes you what you are. As no one can own you, in part or in whole, they can't own what's in your head. They can only share in it. Your life experiences are your own, and no one elses.

Trade secrets must be acknowledged as temporary artifices at best. As the pirates say, two men can keep a secret, if one of them is dead.

= 9J =

Not under California law

[NotASuit]

One of the reasons that California's tech sector is dominant, and that California has such a history of innovation, is that California law does not enforce non-compete contracts except in very narrow circumstances. IAAL, and as someone who has litigated these cases before, I suggest to any employee that they attempt to negotiate a California choice of law clause in their employment contracts, especially if they work in California or for a company based in California.