Report: IBM Tries to Block Former Exec from Joining AWS

IBM is suing a former senior manager for violating a non-compete agreement as he starts a new job at Amazon Web Services (AWS) three months after leaving his role as CIO for transformation and operations at IBM.

According to a report by Westfair Online, IBM sued Jeff S. Smith last week in White Plains, NY, demanding that he repay $1.7 million in stock bonuses. Smith had worked at IBM since 2014.

IBM argues that in starting his job at AWS on Monday, he would “inevitably be involved in decision-making about how best to compete against IBM and would inevitably disclose or use IBM trade secrets.” The lawsuit also alleges that Smith had shared inside information with AWS CEO Andy Jassy while he was working for IBM, wiping his company phone and tablet to make it impossible to detect communications, the report said.

The judge, who blocked Smith from starting his job at AWS on Aug. 1 until a full hearing could be scheduled, amended the order to allow him to begin work Monday in “listen and learn mode” for training purposes.

According to IBM, Smith signed a non-compete agreement where he agreed not to work for a competitor for one year. He notified IBM in June of his plans to start work at AWS in August.

IBM has asked the court to ban Smith from work for AWS until May 2, 2018. There is a hearing scheduled for Aug. 21.

In June, AWS won a temporary restraining order to prevent a former executive from joining Smartsheet, a collaboration software provider, only to drop the lawsuit a week later.