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IBM Sues Apple-Bound Microchip Expert

Big Blue says Mark Papermaster's bolt to Cupertino violates a noncompete agreement.
IBM is suing one of its top technology executives, claiming that his acceptance of a job at rival tech vendor Apple violates a noncompete agreement he signed.

Mark Papermaster's plan to join Apple violates "his contractual obligation to refrain from working for an IBM competitor for one year" after leaving the company, IBM states in papers filed last week in U.S District Court in Manhattan.

Papermaster, a 26-year IBM veteran, is part of the company's "elite" Integration & Values team, according the documents. He is also the top expert in IBM's Power microprocessor architecture and "is privy to a whole host of trade secrets and confidences belonging to IBM," according to the complaint.

IBM said it fears that Papermaster could help Apple develop rival server and chip products, and notes that Apple earlier this year acquired P.A. Semi with an eye to expanding its presence in those markets. IBM also claims that Apple considered replacing the IBM Power chips used in some of its computers with chips made by P.A. Semi.

"Through its acquisition of P.A. Semi and its hiring of Mr. Papermaster, Apple intends to design microprocessors for incorporation in a variety of electronic devices, including handheld devices," IBM states.

In its court filing, IBM revealed that it offered Papermaster "a substantial increase" in his compensation package to stay with the company. "IBM offered to pay Mr. Papermaster one year's salary in exchange for Mr. Papermaster to respect his contractual obligation to refrain from working for an IBM competitor for one year," IBM says.

The efforts were to no avail. Papermaster submitted his resignation on Oct. 21 and informed IBM that he intended to start employment with Apple beginning in November. IBM sued Papermaster on the following day.

IBM is asking the court to block Papermaster's move to Apple. Papermaster has yet to file a formal response to IBM's charges.