IBM forced to pay $3 million bond to continue Papermaster case

The stakes keep getting higher and higher in the Mark Papermaster case.  Last week, a New York Judge ordered that Mark Papermaster quit working at Apple until further order from the court.  This week, that same court has ordered IBM pay a $3 million dollar bond in the event that Papermaster was found to be damaged by the suit.

The $3 million bond is designed to pay for any costs or damages that Papermaster might suffer if it’s later determined that IBM wasn’t entitled to an injunction.

Karas noted that district courts are allowed "wide discretion" in setting the bond’s dollar figure, then added: "Based on a careful reading of the letters sent by the parties to the court, which are being filed under seal, the court finds that a bond in the amount of $3 million is appropriate to guarantee payment of the costs and damages that defendant may suffer, if the injunction should not have been issued."

Papermaster,  today, counter-sued IBM saying  that non-compete clause he signed with IBM is irrelevant because:

1. Apple and IBM aren’t direct competitors

2. The agreement only applies in New York, not in California or Texas who have much more lax laws and would be where Papermaster was hired and would now be working respectively.

3. The agreement’s interpretation is too broad, the time is too long.

How long will IBM pursue Mark Papermaster.  Prospective hires have to be worried about their eerily harsh tactics in punishing an exiting employee.

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