In its most recent ruling on trade secrets protection via non-competition agreements, the Southern District of New York followed a step by step approach to point out that IBM’s ex-business management executive did not know enough trade secrets to prevent him from working for competitor HP. Int’l Business Machines Corp. v. Visentin, 11-cv-399 (SDNY 2011).
Defendant Giovanni Visentin accepted a job with HP as the Senior Vice President and General Manager of its Enterprise service. Ex-employer IBM immediately sued for a preliminary injunction to enforce the non-competition agreement in Visentin’s previous employment contract.
After a six-day, closed door hearing to assess what, if any, trade secrets Visentin might be taking over to the competition, the Court held, in a step by step analysis that:
In sum, the Court seemed to reiterate the BDO Seidman proposition that highly technical employees are far more likely to hold protectable trade secrets than top-level executives whose jobs are to manage large teams of people and further general operative efficiency.
Take-away: Internal business strategies, market strategies, etc… are not trade secrets and it is very difficult to make a NY non-compete agreement stick to employees responsible for such non-technical aspects of the business.
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