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In a victory for employment mobility, a Santa Clara County Superior Court judge in San Jose, Calif., declined on Thursday to temporarily bar three former Intel Corp. engineers from working at their new positions at Broadcom Corp. “The court finds (as Intel frankly concedes) that Messrs. Young, Lindsay and Lund are trustworthy and further finds no evidence of actual misappropriation and insufficient evidence of threatened misappropriation of Intel’s trade secrets as to these three former key Intel employees,” Judge William Martin wrote. “California’s strong public policy against limitations on employment mobility clearly prevails when contrasted with the state of the evidence as to these three individuals,” he said. Many eyes are on the Intel case because it is grounded in the “inevitable disclosure” doctrine that holds employees will eventually disclose their former employers’ trade secrets to their new firm. The doctrine is recognized by other states, including Florida and New York, where employees are prohibited from taking positions with competing companies for a specified period of time. But California is different because it doesn’t enforce non-compete contracts. And in April, the California Supreme Court unanimously depublished Electro Optical Industries Inc. v. White, 76 Cal.App.4th 653, a 2nd District Court of Appeal decision which upheld the “inevitable disclosure” principle at the behest of attorneys who said the doctrine was being used by employers who wanted to stifle competition from departing employees. Just weeks after the depublication, Intel amended its complaint to include an allegation of actual trade misappropriation. Intel sought from the outset to bar engineers Greg Young and Steve Lindsay from working in similar positions at Broadcom for one year. The company also sought to prevent Martin Lund, formerly with Intel’s office in Denmark, from working for Broadcom, since he was bound by a non-compete clause with Intel. “All we did was take different jobs — we didn’t do anything wrong,” said Lindsay, one of the three engineers named in Intel Corp. v. Broadcom Corp., 788310. But Judge Martin did fault Irvine-based Broadcom for its dealings with one former Intel employee, and barred him from working at Broadcom until after a trial. In the case of Bradley Gunther, Martin said the “court finds probable cause to believe that indeed such misappropriations occurred.” Intel alleges that Gunther passed on Intel financial information and chip trade secrets to Broadcom chief executive officer Henry Nicholas III via an e-mail. Nicholas said he wasn’t soliciting information but interviewing Gunther. Martin imposed a preliminary injunction prohibiting Gunther’s employment at Broadcom until after a trial is held. Broadcom was further ordered to implement a training program relating to trade secrets for its employees. “The big news here is that the Broadcom CEO is not to be believed,” said Intel attorney James McManis. “The people over there need a lesson in trade secrets.” COMPETITIVE THREAT? In closing arguments Wednesday, McManis said that the three engineers would inevitably pass on trade secrets and that a preliminary injunction to prevent them from working in the same field at Broadcom was imperative to protect Intel’s ethernet technology. Intel asked that the three be enjoined from working with gigabit ethernet product technology. “Intel trade secrets will infiltrate their work despite their best effort and good faith,” said McManis, of San Jose’s McManis, Faulkner & Morgan. Ulrico Rosales, who represents Broadcom, characterized the dispute as a desperate attempt by Intel to prevent the highly talented “all stars” from working for a competitor. “This case has been about Intel’s desperate attempt to keep its talented workers from going to the competition,” said Rosales, of Palo Alto’s Wilson Sonsini Goodrich & Rosati. Rosales further said Intel had not presented any evidence that the three engineers — who are regarded even by their former employers as trustworthy — were any threat to releasing Intel’s information. “This inevitable disclosure is a figment of the lawyer’s imagination,” Rosales told Martin on Thursday. Intel’s suit was filed on March 8 and charged Broadcom — an upstart competitor in the semiconductor industry — with trying to misappropriate Intel’s trade secrets by luring away high-level employees. The preliminary injunction hearing lasted nine days. A trial date has not yet been scheduled. “We have no problem with them working at Broadcom,” McManis told the judge. “The only thing we don’t want them to do is to work at the same positions they were working on at Intel.” Intel alleges Lund was gathering information about the company while at the same time negotiating a contract agreement with Broadcom. But Rosales has countered that Intel has offered up no example of trade secrets that have been divulged. “This inevitable disclosure is a figment of the lawyers’ imagination,” Rosales said.

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