A U.S. District Court in New York has ordered former IBM executive Mark Papermaster to immediately stop working for Apple. Papermaster was recently wooed away from IBM after being offered what he described as “a once in a lifetime opportunity”.
Papermaster, a server expert and chip guru, was recently sued by IBM to prevent him from going to work at Apple. IBM asserts that Papermaster is subject to a non-compete agreement and is prohibited from working at a competing company for a year. Papermaster, however, claims that Apple isn’t a competitor to IBM to the extent that IBM does not manufacture consumer electronics. Furthermore, Papermaster joined Apple as a Senior Vice President of Devices Hardware Engineering, and will oversee its iPhone and iPod development.
In a court document filed this Thursday, Papermaster stated:
“To the best of my knowledge, IBM does not design, manufacture or market consumer electronic products. Instead, IBM focuses on high-performance business systems such as information technology infrastructure, servers and information storage products, and operating systems software.”
I.B.M., however, wasn’t buying this argument and responded:
“Electronic devices large and small are powered by the same type of intelligence, the microprocessor”.
IBM fears that Papermaster, should he work for Apple, would disclose proprietary information about IBM’s processors and server technology, helping them to develop rival products. Apple, though, states that Papermaster will lead Apple’s iPod and iPhone engineering team, and Papermaster himself noted that his new position at Apple involves “entirely different technology from what he managed at I.B.M.” He also noted that he was hired by Apple primarily for his managerial skills than for his technological expertise.
Some, however, claim that Papermaster’s new job description is merely a placeholder position/title that’s in place until Papermaster’s 1 year covenant to compete expires. And given the fact that Apple seems to have its eye on developing proprietary chips for the iPhone, it seems that Papermaster’s expertise would necessarily come into play in his capacity as the executive overseeing iPod and iPhone development.
In response to the Judges ruling that Papermaster must immediately stop work for Apple, an Apple spokesman had this to say:
“We will comply with the court’s order but are confident that Mark Papermaster will be able to ultimately join Apple when the dust settles.”
A hearing on the issues is set for November 18, and Papermaster’s lawyers have until November 11 to file any objections to the Judges most recent ruling.
Fortune has a comprehensive timeline of the IBM/Apple/Papermaster dispute which can be found here.
Interestingly, Papermaster’s bio is no longer on Apple’s website.