Microsoft Wins Google-Hire Restraining Order

UPDATED: Round two to Microsoft. Over to you Google.

Microsoft won a temporary restraining order to keep
high-level search researcher Dr. Kai-Fu Lee from defecting to search rival
Google .

The latest legal maneuver keeps Redmond’s search trade secrets and
China business strategy out of the hands of its rival — for now.

On Wednesday, a King County Superior Court judge in Seattle ordered that
Lee be enjoined from joining Google. The order said Dr. Lee was prohibited from taking a job that that might be
“competitive with or engaging in any activities competitive with any
product, service or project (including actual or demonstrably anticipated
research or development),” according to the order by Judge Steven Gonzalez.

It also ordered Microsoft to post $1 million as security for the other
side’s legal costs if the case goes Google’s way. The next hearing in the matter is slated for September 6, when Google will argue why the restraining order should be lifted.

“While we don’t believe a [temporary restraining order] is necessary, we’re gratified that the judge recognized that all Google and Dr. Lee have to do is avoid having Dr. Lee do anything competitive with what he did at Microsoft,” Nicole Wong, Google associate general counsel, said in an e-mail. “As we have said all along, we have no intention of having him do that.”

She noted that the judge ordered Microsoft to be more specific in identifying exactly what Lee had worked on that would be competitive with what he will do at
Google. “We will be looking for clarification when Microsoft complies with the judge’s order,” she said.

Microsoft sued
Google and Lee about two weeks ago after Google announced it had hired
Lee as vice president of engineering and president of Google China.
Lee was tapped to head up a new R&D facility.

According to Microsoft, Lee’s contract included an agreement not to
compete with Microsoft for a year after he left. Specifically, the agreement
said, “I will not (a) accept employment or engage in activities competitive
with product, services or projects (including actual or demonstrably
anticipated research or development) on which I worked or about which I
learned confidential or proprietary information or trade secrets.”

Since Microsoft filed
suit to prevent Lee from defecting to Google, Google has filed a countersuit against Microsoft, claiming the non-compete clause in contracts signed by Redmond executives won’t stand up under California laws.

Google argued that, while Lee’s contract with Microsoft was governed by the state of Washington, California law should now apply to Lee, because he plans to maintain a
residence in the state while he opens Google Research China, and he’s
applied for a California driver’s license.

“What they’re doing is intimidation, pure and simple. It is clearly an
illegal restraint of trade,” Nicole Wong, Google associate general counsel,
recently said in an e-mail.

“They’re trying to intimidate Dr. Lee and any other employee who might want
to leave Microsoft. We won’t let that happen.”

In a statement, Microsoft said: “We felt we needed to take this step to
protect our sensitive business information and to ensure that Google and Dr.
Lee honor the confidentiality and non-competition agreements he made to us
when he began working at Microsoft. We are pleased that the Court has
entered the temporary restraining order to preserve Microsoft’s legal rights
until a preliminary injunction hearing can be held.”

Updated to add comment from Google.