Former Microsoft executive barred by judge

August 2, 2005

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A judge has reportedly barred a former Microsoft executive from performing any duties at Google that would be similar to those he did while he was employed at Microsoft.

The ban is said to be temporary for now.

Washington state Superior Court Judge Steven Gonzalez on Thursday granted Microsoft's request for a temporary restraining order to prevent Kai-Fu Lee from violating his noncompete agreement.

Google announced on July 19 that it had hired Lee to lead a new research and development center in China and serve as president of its Chinese operations. Lee was previously a vice president at Microsoft and played a key role in its operations in China. He also led development of some of its search technologies, Microsoft's lawsuit claims.

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The same day that Google announced its new hire, Microsoft sued Lee, claiming he was breaking a one-year noncompete agreement by joining Google. Microsoft also sued Google, accusing it of encouraging Lee to violate promises made to Microsoft. Two days later, Google asked a California court to declare Microsoft's noncompete provision invalid.

Google and Lee claim that Lee would not be doing anything at Google that would compete with work he did at Microsoft, and Lee says he contacted Google and was not recruited.

Specifically, Gonzalez prohibited Lee from working on search technologies, business strategies, planning or development related to the computer search market in China, as well as any other areas he worked in while employed at Microsoft.

Google and Lee were also barred from disclosing or misappropriating any trade secrets or proprietary information obtained while Lee worked at Microsoft and from destroying any documents or data that relate to Lee's employment at the companies. They have one day to hand over any documents or material Lee obtained from Microsoft during his tenure there. The ruling also prohibits Lee from encouraging any Microsoft employees to join Google.

Gonzalez also barred Microsoft from destroying relevant documents and ordered the company to post $1 million security to be used to pay for Google and Lee's costs and damages if it is determined the temporary restraining order was wrongfully granted.

The judge's order set a Sept. 6 hearing on Microsoft's request for a preliminary injunction, which would bar Lee from doing similar work at Google as he did at Microsoft until a verdict is rendered at trial. The temporary restraining order remains in effect until that hearing, the order says.

Separately from the restraining order, the judge scheduled a trial date of Jan. 9, a Microsoft spokeswoman said.

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With its California request, Google appears to be trying to take advantage of a state rule that frowns on noncompete contract clauses. But the case could pose some sticky jurisdictional questions. Google, headquartered in Mountain View, Calif., says Lee resides in California but is supposed to lead the company's operations in China. Microsoft's lawsuit was filed in Seattle, not far from its Redmond, Wash., campus.

Court filings in the case show that Microsoft had paid Lee more than $3 million since August 2000, more than $1 million last year alone. Lee originally joined Microsoft in Asia in 1998 and founded its China research lab. He left and was rehired by Microsoft to work at its Redmond campus.

Google and Lee claim the Microsoft lawsuit is a "charade" meant to frighten other Microsoft workers from jumping to Google, according to court documents. The spat is the latest in an increasingly personal tussle between the companies, which compete in Internet search and other areas.

This isn't the only legal headache for Google. A former Google sales executive has sued the company, alleging that it engaged in job discrimination while she was pregnant with quadruplets.

Google was not immediately available for comment on the temporary restraining order.

Source: ZD Net

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