In a lawsuit filed recently in California, Apple Inc. accuses one of its former executives of using information he had access to while working with the company to launch his own competing business. The technology giant alleges that the man’s scheme was designed to place Apple in a position where it had no choice but to buy his company. The lawsuit claims the man boasted to his colleagues that he was developing a processor Apple would need and have to acquire.
The complaint also alleges that the man violated the terms of his employment contract by luring Apple employees away to join his new company. Apple is asking for damages to compensate it for the man’s alleged breaches of his duty of loyalty and his employment contract. The company also seeks an injunction to prevent further employee poaching. Legal experts feel that Apple’s poaching arguments face an uphill battle as contracts that prevent workers from pursuing new opportunities are difficult to enforce in California.
The executive wants the lawsuit to be dismissed. He says that Apple’s employment contracts contain provisions such as non-compete clauses that are not permitted in California. He also claims that Apple violated privacy laws by monitoring his emails and text message exchanges. The man resigned from Apple in April. He and two other former Apple workers launched their new venture in November.
Lawsuits like this one can drag on for years and be ruinously expensive to litigate. Attorneys with experience in this area could seek to avoid them by drafting unambiguous agreements that comply with state and federal laws and make the consequences of breaching them explicit. When contract disputes do arise, attorneys could suggest taking steps to avoid a public court battle such as seeking a resolution through negotiations or mediation.