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Steve Jobs poaches IBM chip and blade geek

Big Blue phones lawyers

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Mark Papermaster, one of the top Power chip gurus at IBM and its current vice president in charge of its blade server development unit, wants to take a job at Apple as a technology adviser to Steve Jobs, the company's chief executive officer.

After 26 years at Big Blue, you can probably imagine that a change would feel good. However, IBM is trying to enforce a non-compete to keep Papermaster from taking the gig, and this week filed a lawsuit in its home court to enforce the non-compete.

The lawsuit, which was filed on October 22 in the United States District Court for the Southern District of New York, alleges that as one of the key 300 executives on IBM"s "elite Integration & Values Team" and as a key designer of Power processors and blade servers, Papermaster is "privy to a whole host of trade secrets and confidences" that IBM uses to design products.

While non-compete agreements are tough to enforce, IBM's lawyer, Evan Chesler of New York's Cravath, Swaine, and Moore, is no slouch. This is the lawyer that talked the U.S. government into dropping IBM's antitrust consent decree restrictions - and IBM does have home field advantage in the court.

IBM did not want to talk about the case. "Mr. Papermaster's employment by Apple is a violation of his agreement with IBM against working for a competitor should he leave IBM," explained Fred McNeese, director of IBM corporate media relations in an email. "We will vigorously pursue this case in court." McNeese also said he did not have a copy of the brief, which I find hard to believe. But this is the Fortune 500, right?

According to the complaint by IBM, Papermaster's non-compete agreement (which is part of his employment contract at Big Blue) does not allow him to work for competitors for a year and also has geographic restrictions that do not allow him to work in physical places where he had job responsibilities within a year. The non-compete also requires he not solicit other IBMers to move to a company for two years. The complaint says Papermaster resigned on October 21 and said his job at Apple would begin in November.

The complaint is not terribly specific about what job Papermaster is taking at Apple, but IBM's lawyers claim that in the wake of Apple's acquisition of clone Power chip maker PA Semi earlier this year and now Papermaster's appointment, Apple and IBM will be competitors in the server space. IBM's complaint goes so far to assert that "Apple intends to expand its presence in the server business" based on these actions.

History has suggested otherwise, and Apple has, in fact, resisted any temptation to take its Xserve business seriously and push into the SMB space with more powerful Power or Xeon servers - despite the imploring of Apple customers and enthusiasts.

Apple, of course, switched from PowerPC to Intel Core and Xeon processors for its desktops, laptops, and servers in 2005. While IBM's Power processors are great for midrange and high-end servers, they are too hot and too expensive for use in Apple's relatively low end iron. And the PowerPC family of chips made by IBM and Motorola and used in Apple gear since the early 1990s were not keeping pace with what Intel was doing with Core and Xeon chips in terms of price and performance. Hence Apple's move.

It is hard to argue that Apple needs the Power chip expertise that Papermaster has. PA Semi was founded more than four years ago by Dan Dobberpuhl, the lead chip designer on Digital Equipment's Alpha line of RISC processors and the StrongARM line of embedded processors, and Jim Keller, an Alpha chip designer who was the co-designer of the original Opteron chip at Advanced Micro Devices.

PA Semi had also hired Pete Bannon, an Alpha EV5 and EV7 chip designer that went over to Intel to work for a while on the impending "Tukwila" four-core Itaniums before coming aboard PA Semi. Keller left just before the samples came out almost two years ago, and Apple has not said which of the remaining PA Semi tech people are still around. But by creating a Power clone called PWRficient (which started sampling in February 2007), the company Apple acquired in April of this year had plenty of Power, x64, Itanium, and Alpha smarts.

No comment from Apple on all of this. Naturally. ®

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