Thu, Jul 21, 2005 page12

• Microsoft sues rival for hiring executive

  DISPUTE Microsoft claims that Google poached one of its top executives and made him the head of the search-engine firm's fledgling operations in China

  • NY TIMES NEWS SERVICE
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  Microsoft filed a lawsuit against Google on Tuesday asserting that Google hired away a Microsoft executive in violation of a clause in the executive's contract that precludes him from working for a competitor.

  The lawsuit came one day after Kai-Fu Lee (李開復), 43, an expert in speech recognition and an accomplished engineer, told Microsoft officials that he was leaving his position as vice president of the interactive services division to take over as head of Google's fledgling operations in China.

  Tom Burt, a deputy general counsel for Microsoft, said Lee had knowledge of trade secrets pertaining to Microsoft's search engine technology and its China business strategy. Under Lee's employment contract with Microsoft, he is not allowed to work for a direct competitor for at least one year after leaving Microsoft or to disclose company trade secrets at any point, Burt said.

  "It's a very egregious violation of his noncompetition agreement," Burt said of Lee's new position with Google. The lawsuit, which also names Lee as a defendant, asks the King County Superior Court in Seattle to enjoin Google and Lee from violating the noncompete clause.

  In a prepared statement, Steve Langdon, a Google spokesman, said the company has reviewed the claims and found them "completely without merit."

  "We're thrilled to have Dr. Lee on board at Google and we will defend vigorously against these meritless claims," Langdon said in his statement. He declined to elaborate on the basis for Google's legal analysis that the company and Lee were not in violation of the employment contract.

  There is nothing unusual about companies asking executives and even rank-and-file workers to sign noncompete clauses. At Microsoft, Burt said, all employees sign an agreement precluding them from giving away trade secrets or working for a competitor for at least a year after leaving the company.

  Burt said such an agreement does not preclude Microsoft employees from working for competitors, even immediately upon leaving Microsoft, but they cannot work in a position directly competitive to Microsoft unless they reach a separate agreement with Microsoft.

  Burt said that in this case, neither Lee nor Google made an effort to negotiate such an agreement.

  Lee has been hired to lead Google's Chinese operations, which are scheduled to begin in earnest in the third quarter of this year. Lee, a graduate of Columbia University who also holds a doctorate in computer science from Carnegie Mellon University, said in an interview that he had been looking to return to China, where he spent the first 11 years of his life.

  Lee said he joined Microsoft in 1998. His first job at the company was to start an academic research lab in China. In 2000, he returned to the US and worked on speech recognition. He declined to discuss the lawsuit.

  It is not clear whether Lee's new job, as the president of Google's Chinese operations, will put him in direct competition with his old job at Microsoft. At Microsoft, he said, he worked largely on speech recognition projects like designing automated computer systems that could recognize voice commands.

  Burt said that Microsoft had been aware of Lee's interest in returning to China but was unable to offer him a leadership position there that is senior enough to suit his desires. Burt said that Microsoft was not necessarily asking the court to prevent Lee from joining Google, but rather to prevent him from competing directly against Microsoft or sharing trade secrets.
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