A123 Systems Sues Apple for Poaching Car Battery Engineers

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Apple has been hiring engineers from vehicle battery designer A123 Systems, and the company has filed a lawsuit alleging the iPhone and iPad maker violated employee anti-compete agreements. The employees all came from A123's advanced energy storage division and were working on what the company called game changing technologies.

A123 Systems sues Apple for hiring its car battery design teamA123 Systems sues Apple for hiring its car battery design team

A123 named Apple along with the five employees who left for the Cupertino company in the lawsuit. The filing said Apple first hired away their CFO Mujeeb Ijaz, who then brought on board four other employees over an eight month window. The five were so critical to the projects they worked on that ABC123 had to shut them down.

Apparently the employees had all signed non-compete agreements, along with non-disclosure and non-solicitation agreements when A123 hired them. The company is using those agreements as the basis for its lawsuit against them and Apple.

A123 went on to say Apple has been recruiting from SiNode Systems, another battery developer it collaborates with and is familiar with its technologies. Other employees have been hired away from A123 clients with knowledge of the company's technologies, too, such as Samsung, Toshiba, LG, and Panasonic.

Since A123 focuses on vehicle batteries, Apple's interest in the employees it recruited are likely now part of the team working on the company's car project. Word surfaced this month that Apple is developing its own electric-powered car, which will need some serious battery technology to keep it running.

Apple has also hired employees away from electric car maker Tesla, as well as a top level executive in charge of research and development at Mercedes-Benz—all very compelling evidence to support the idea that Apple has serious plans to shake up the automotive industry.

A123 Systems filed its lawsuit in Massachusetts and is asking the court to block its former employees from working for Apple for at least a year, to prevent Apple from hiring away any more of its staff, and for damages and legal fees.

[Thanks to Law360 for the heads up]

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It's a safe bet Apple knew the A123 employees it hired had signed non-compete agreements, so this lawsuit isn't likely catching them unprepared. It also underscores just how serious Apple is about designing its electric car.

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Comments

FCompton

... and if they were headquartered in California, this would not be an issue, no?

JustCause

Or…. How serious it is about improving battery technology for all of it’s products

Non-competes are a joke, “hey you that is an expert in this given technology, you can only work for us on this tech the rest of your life or will sue”.

JustCause

Dang, will—> we’ll grin

geoduck

I agree that these clauses are very shaky

non-compete agreements; Apple isn’t in competition with a123. Apple makes batteries for their own products.

non-disclosure; OK they won’t communicate any propitiatory information. But I can see Apple using them to specifically NOT infringe on the other companies patents. Also the underlying principals are public. You can not copy a Duracell but you can make an alkaline battery, to use an overly simplistic comparison.

non-solicitation agreements; See part one. Apple isn’t competing with a123. They won’t be soliciting any of a123’s customers.

I can also see a123 going after the former employees, but suing Apple seems silly.

{sigh} but this will still tie up scarce court time for a few years.

geoduck

OTOH, while I’ve been very skeptical of rumors of Apple making a car, stories like this one suggest SOMETHING automotive is going on.

vpndev

“{sigh} but this will still tie up scarce court time for a few years”

True. I guess Samsung would regard that as a “good thing” smile

vpndev

Please…

s/it’s products/its products/

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