| By Maureen O'Gara |
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| November 4, 2008 06:15 PM EST |
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IBM has sued one of its top executives, a guy who knows all its secrets, to stop him from going to work for Apple and sharing those secrets with Steve Jobs.
It has asked a New York federal court to enforce the non-compete signed by 26-year IBM veteran Mark Papermaster, the guy IBM calls its top Power expert, the guy who also ran its x86 blade development unit, so he can’t go to work for Apple for a year.
According to IBM Papermaster is a walking security risk because he was one of the 300 senior managers who make up what IBM calls its “elite” Integration & Values Team.
Those 300, it says, are “charged with addressing the most difficult and important issues facing IBM, such as developing corporate strategy and driving innovation and growth” and “work with the most sensitive strategic information the company possesses.”
Papermaster knows IBM’s strategic plans, marketing plans, long-term business opportunities and the development status of its products and was privy to IBM trade secrets and confidences – and IBM claims he “will inevitably use and/or disclose IBM trade secrets for his own benefit and for the benefit of Apple” if he goes to work there.
IBM told the court when it filed for an injunction on October 22 – the day after Mr. Papermaster tendered his resignation but hadn’t even left the company yet – that it had offered him “a substantial increase in his total compensation package” to stay or, failing that, a year’s salary not to go to Apple for the year required by the non-compete.
It said he told IBM he had to think about it but resigned the next day, effective October 24, and said he would start at Apple in November. Obviously Apple is betting the non-compete won’t hold up.
According to IBM, Papermaster will be “a senior executive and corporate officer at Apple and will work very closely with Apple’s chief executive officer in providing to Apple technical and strategic advice on a variety of issues.”
He’s also supposed to have responsibilities for the same geographic area he had at IBM.
IBM says it’s worried about Apple’s Xservers and PCs getting more competitive thanks to Mr. Papermaster, but mostly it’s worried about what he will do with PA Semi, the fab-less semiconductor start-up that Apple bought in April.
Apple didn’t explain the acquisition at the time and it confused everybody.
Apple had supposedly washed its hands of PowerPCs in favor of Intel chips – a move that has made its boxes seem to fly off the shelves – but PA’s skill were with the PowerPC.
The start-up had built a low-power dual-core 64-bit PowerPC derivative that only needed something like 4W-7W to run at 2GHz, with a quad coming.
IBM confesses in the suit that in 2006 before Apple went to Intel for its chips Apple considered replacing the IBM PowerPC G5 microprocessors that it used to use with MPUs designed by PA.
IBM says it understands that “Apple intends to expand its presence in the server business through its acquisition of PA Semi and its hiring of Mr. Papermaster.”
Idle bystanders suggest Apple wants Papermaster for cloud purposes and that that’s what’s really got IBM so bent out of shape.
IBM also thinks Apple “intends to design microprocessors for incorporation in a variety of electronic device, including handheld device.”
Jobs intimated he bought PA for iPhone and iPod and it’s believed PA may now be working on the ARM, crushing Intel’s hopes of getting the Atom into those widgets, but nothing is certain.
IBM claims if Papermaster isn’t made to stick to his non-compete IBM will be “irreparably injured.”
The non-compete, by the way, restricts Papermaster from soliciting business for a year from any customer he was involved with during his last 12 months at IBM and from recruiting any IBM employees for two years.
Maureen O'Gara the most read technology reporter for the past 20 years, is the Cloud Computing and Virtualization News Desk editor of SYS-CON Media. She is the publisher of famous "Billygrams" and the editor-in-chief of "Client/Server News" for more than a decade. One of the most respected technology reporters in the business, Maureen can be reached by email at maureen(at)sys-con.com or paperboy(at)g2news.com, and by phone at 516 759-7025.
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