[Leaplist] [OT/PD] "Apple Exec Hired From IBM Ordered to Stop Work"

Tue Nov 11 19:23:46 EST 2008

Interesting IBM story - but from quite a ways back. I started with IBM 
in 1962, pretty much just out of college and rather innocent of all this 
stuff. For the next 20 years or so it really didn't matter much, until 
the IBM PC came out.

Then of course a bunch of us started writing PC (DOS) software. Well, 
you could contribute it to the company IF it was sufficiently business 
related, but not games or real "consumer" stuff. There was also a 
submission program for that, but they were VERY VERY fussy, it was 
almost impossible to get things accepted. And of course you couldn't 
sell it independently, the circa-1982 employment agreement said it 
belonged to the company.

Just for the heck of it I obtained a copy of my *1962* employment 
agreement, and it said "Ideas" and "Inventions" belonged to the company, 
not a word about software - in 1962 who in the world would go home and 
write software for a multi-million dollar 7094 on their own time?

I had nothing really valuable, and didn't want to shell out cash for a 
lawyer, but I did go talk to one of IBM's legal eagles, and AMAZINGLY he 
agreed with me - software was not covered by my agreement, and I owned 
it, not IBM. If I wanted to keep it and sell it at such time as I left 
the company, I would be free to do so.

BUT - and here was the real kick in the butt - doing so while still 
employed by IBM would be a CONFLICT OF INTEREST, strictly verboten and 
could get me fired!

Of course, at the time I had no idea how fast things changed in the 
software world, and by the time I took a buyout/early retirement in 1992 
all that stuff was, alas, obsolete and totally worthless. Ya can't win!

Jim Hartley

Steve Litt wrote:
> On Tuesday 11 November 2008 12:06:32 pm Bryan J. Smith wrote:
> 
>> "Apple Exec Hired From IBM Ordered to Stop Work"
>>   http://www.pcmag.com/article2/0,2817,2334163,00.asp
>>
>> Companies pull Non-Competes on former employees regularly.
>> Most of the time, the two companies (former and new) work
>> out a "deal," often a monetary and contractual agreement,
>> that allows the change of position of the employee when they
>> are "uniquely qualified/knowledgeable."  But sometimes you
>> get what we have here with an ex-IBM employee who IBM just
>> does not want to let go.
>>
>> Non-Competes _are_ enforceable.  
> 
> Here is the text of Mark Papermaster's non-compete:
> 
> http://blogs.zdnet.com/BTL/images/papermaster2.pdf
> 
> As you read Mark's contract, notice that the second he signed it, he was IBM's 
> slave. IBM no longer had an incentive to give him raises -- where else would 
> he go for a salary? IBM no longer had an incentive to treat him well -- 
> where's he gonna go? From the moment he signed that agreement, Mark 
> Papermaster's alternative to IBM was to open a restaraunt or become a fitness 
> coach.
> 
> Read your contract! A couple clauses in a contract can change that dream job 
> into slave labor or worse. Wait til you get one of those clauses stating that 
> anything you think up during your employment period and for two years after 
> termination, on or off the job, whether relevent to your job or not, belong 
> to the company, and you must affirmatively assist in patenting or 
> copyrighting what you thought up and turn it over to the company.
> 
> If you're a contractor, watch out for that bankruptcy maker, the 
> indemnification clause. They'll tell you verbally it simply says you won't 
> sue them (which is bad enough -- their ceiling falls on your head due to 
> negligent maintenance and you can't sue), but it's much more than agreeing 
> not to sue them. If a third party sues them, ALLEGING that something you were 
> involved in caused damage to the third party, YOU must defend the company 
> including legal fees and remuneration to the third party. The company decides 
> the legal defense at its sole discretion, but YOU foot the bill. You're an 
> unpaid insurance company, insuring a megacorporation with the equity in your 
> house, your childrens' college fund, and your 401K.
> 
> And then there's that innocent sounding nondisclosure agreement. Certainly 
> it's unethical to disclose the secrets of the company who fed and clothed you 
> and your family. But most nondisclosure agreements are crafted so broadly as 
> to function as noncompete, perhaps ruining your chances to continue working 
> in that field. Imagine if architects had to sign a document that no future 
> house would have the unique features of your house. He'd never build another 
> house.
> 
> I've lost tens of thousands of dollars refusing troubleshooting course 
> contracts with indemnification, noncompete, overly broad non-disclosure, 
> and "your inventions belong to us" clauses. That's OK. I sleep well at night, 
> knowing that 2 years from now some corporation isn't going to tell me I have 
> to pay to defend them against a frivolous lawsuit. Knowing that every time I 
> teach a course and come to some new realization about troubleshooting, I can 
> use that realization in my next class. Knowing that I can keep writing books, 
> and no corporation who thought they were being generous paying me $6,000 is 
> going to claim copyright on that book.
> 
> By the way, I've also had many customers say "OK, you don't have to sign, just 
> come teach troubleshooting" when it was clear they wouldn't have my services 
> if they insisted on such crazy contracts.
> 
> A lot of people say you can't work without signing such contracts. First -- 
> that's not true -- a lot of small companies don't require them. Second, why 
> do you think such boilerplate is so common? It's because everyone just holds 
> their nose, signs it, and hopes they don't end up like Mark Papermaster. If 
> technologists refused to sign the worst of such contracts, corporations would 
> understand that there's pain involved in such gratuitous boilerplate, and the 
> worst of it would disappear.
> 
> I'll tell you a little story. In 1989 I was a contract programmer for a large 
> law firm. They decided to have all IT employees and contractors sign a 
> contract with a broad and severe noncompete that would have left me unable to 
> work for others.I gave the IT director an alternative contract saying I 
> wouldn't disclose company secrets. He handed it back to me and scornfully 
> said this was a professional law firm and he'd accept only the original.  
> Every single mainframe programmer just signed this horrible contract, but a 
> few of us PC types got together, consulted a lawyer, and basically said "no". 
> The IT director called a meeting, sat us down, and basically said "sign or 
> you're gone". My key card was in my hand, ready to throw at him if he backed 
> me into a corner. But he didn't. A couple weeks later there was another 
> meeting, where they basically said "you don't have to sign this, but you'd 
> better not disclose our secrets, because getting sued by our firm will be the 
> worst thing that ever happened to you". I was free to work elsewhere, and 
> worked elsewhere often during the 10 years when the law firm was my client.
> 
> Read all the paperwork you'll be required to sign before giving notice at your 
> current company. The wording of that contract is every bit as important as 
> the training they'll give you, the kewl new technology you'll get to work 
> with, the great health plan they offer, or the status of working for their 
> company.
> 
> SteveT
> 
> Steve Litt
> Recession Relief Package
> http://www.recession-relief.US
> 
> 

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