NetApp claims ex-CTO built a secret cloud platform then sold it to VAST Data
(2025/11/18)
- Reference: 1763475308
- News link: https://www.theregister.co.uk/2025/11/18/netapp_cto_lawsuit/
- Source link:
NetApp has accused its former senior vice president and CTO of secretly building a rival cloud control platform while still on its payroll, triggering an urgent legal scramble.
The lawsuit, filed on November 6 in the US District Court for the Middle District of Florida, alleges that Jón Thorgrímur Stefánsson spent his final months at the company quietly laying the groundwork for a competing business, siphoning off confidential information and attempting to recruit colleagues before selling his startup to rival [1]VAST Data in September 2025.
According to the [2]complaint [PDF], Stefánsson spent eight years at NetApp and played a "central part" in the development of its cloud data management stack. Court documents say he helped build NetApp's "advanced service delivery engines for cloud data management technologies, including its cloud control plane," and was "directly involved in the development and integration of NetApp's first-party, cloud-native storage products with the major hyperscalers."
[3]
Because of that role, the company says he enjoyed "wide-ranging access" to its most sensitive internal material, from proprietary innovations to strategic business relationships.
[4]
[5]
NetApp argues that access came with responsibilities, pointing to an employment agreement in which Stefánsson pledged not to engage in conflicting commercial ventures, not to solicit NetApp staff or partners for at least a year after leaving, and not to disclose or misuse the company's confidential information. The complaint claims every one of those obligations was breached.
Stefánsson departed NetApp on June 27. Within a week, he incorporated a new outfit called Red Stapler, and ten weeks after that, VAST Data – one of NetApp's direct competitors – acquired the fledgling company and appointed Stefánsson as its general manager of cloud solutions.
[6]
NetApp claims the timeline alone makes its case. As the complaint puts it, the company "does not believe that Red Stapler developed its own cloud control plane and delivery platform in under ten weeks." Instead, NetApp contends the products VAST bought were effectively its own – technology it "spent years and tens of millions of dollars developing."
Court filings outline three pieces of evidence NetApp says support that view. First, the company says it discovered text messages from a former NetApp employee – now on VAST's board of directors – indicating that Stefánsson had already agreed to join VAST in January, months before his departure. Second, the company says it found messages in which Stefánsson discussed poaching NetApp employees ahead of his exit. Third, the company points to a shared GitHub account named "redstapler-is," which it argues shows design and development activity was underway while Stefánsson still held his post inside NetApp.
"Considered together," NetApp claims, these pieces show that Stefánsson was "developing technology and/or source code and innovating on behalf of another entity" while employed at the company.
[7]
The complaint goes on to argue that there is a "real and immediate threat" that he could use NetApp's trade secrets to give VAST a shortcut to a competing product, potentially damaging existing partnerships and undermining years of internal research.
[8]HP settles fake discount lawsuit for just $4M. Don't expect much of a payout
[9]Oracle faces Texas-sized lawsuit over alleged cloud snafu and radio silence
[10]$380M lawsuit claims intruder got Clorox's passwords from Cognizant simply by asking
[11]Suetopia: Generative AI is a lawsuit waiting to happen to your business
According to the filings, NetApp sent Stefánsson cease-and-desist letters shortly after discovering the alleged activity. The company says that rather than comply, he left the United States for Iceland, prompting it to seek emergency relief from the court. That request was successful. A judge granted a temporary restraining order prohibiting Stefánsson from using NetApp's proprietary material, engaging in any work related to products or software he developed while employed there, soliciting NetApp business partners, or destroying or disposing of documents relevant to the case.
The temporary order is set to expire on November 26, and NetApp says it intends to argue for it to be converted into a preliminary injunction. If granted, that would extend the restrictions through the duration of the litigation.
The complaint does not spell out how the alleged conduct was first uncovered, but the filings argue that the "compressed timeline" from Stefánsson's resignation to Red Stapler's sale speaks for itself. For now, the only certainty is that the dispute has escalated from internal HR alarms to full-blown federal litigation, with NetApp seeking to shut down what it claims is an illicit pipeline of its intellectual property into a competitor's product roadmap.
As the restraining order ticks toward its November 26 expiration date, the next hearing will determine whether the court agrees that the risk to NetApp is urgent enough to warrant keeping Stefánsson on legal ice for the long haul. ®
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[1] https://www.theregister.com/Tag/VAST%20Data/
[2] https://regmedia.co.uk/2025/11/18/netapptradesecretssuit.pdf
[3] https://pubads.g.doubleclick.net/gampad/jump?co=1&iu=/6978/reg_onprem/storage&sz=300x50%7C300x100%7C300x250%7C300x251%7C300x252%7C300x600%7C300x601&tile=2&c=2aRymJWAMIC9ZKVSh0rsnsgAAAEo&t=ct%3Dns%26unitnum%3D2%26raptor%3Dcondor%26pos%3Dtop%26test%3D0
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[8] https://www.theregister.com/2025/04/19/hp_deceptive_pricing_lawsuit/
[9] https://www.theregister.com/2025/04/02/oracle_breach_class_action/
[10] https://www.theregister.com/2025/07/23/lawsuit_clorox_vs_cognizant/
[11] https://www.theregister.com/2025/08/12/genai_lawsuit/
[12] https://whitepapers.theregister.com/
The lawsuit, filed on November 6 in the US District Court for the Middle District of Florida, alleges that Jón Thorgrímur Stefánsson spent his final months at the company quietly laying the groundwork for a competing business, siphoning off confidential information and attempting to recruit colleagues before selling his startup to rival [1]VAST Data in September 2025.
According to the [2]complaint [PDF], Stefánsson spent eight years at NetApp and played a "central part" in the development of its cloud data management stack. Court documents say he helped build NetApp's "advanced service delivery engines for cloud data management technologies, including its cloud control plane," and was "directly involved in the development and integration of NetApp's first-party, cloud-native storage products with the major hyperscalers."
[3]
Because of that role, the company says he enjoyed "wide-ranging access" to its most sensitive internal material, from proprietary innovations to strategic business relationships.
[4]
[5]
NetApp argues that access came with responsibilities, pointing to an employment agreement in which Stefánsson pledged not to engage in conflicting commercial ventures, not to solicit NetApp staff or partners for at least a year after leaving, and not to disclose or misuse the company's confidential information. The complaint claims every one of those obligations was breached.
Stefánsson departed NetApp on June 27. Within a week, he incorporated a new outfit called Red Stapler, and ten weeks after that, VAST Data – one of NetApp's direct competitors – acquired the fledgling company and appointed Stefánsson as its general manager of cloud solutions.
[6]
NetApp claims the timeline alone makes its case. As the complaint puts it, the company "does not believe that Red Stapler developed its own cloud control plane and delivery platform in under ten weeks." Instead, NetApp contends the products VAST bought were effectively its own – technology it "spent years and tens of millions of dollars developing."
Court filings outline three pieces of evidence NetApp says support that view. First, the company says it discovered text messages from a former NetApp employee – now on VAST's board of directors – indicating that Stefánsson had already agreed to join VAST in January, months before his departure. Second, the company says it found messages in which Stefánsson discussed poaching NetApp employees ahead of his exit. Third, the company points to a shared GitHub account named "redstapler-is," which it argues shows design and development activity was underway while Stefánsson still held his post inside NetApp.
"Considered together," NetApp claims, these pieces show that Stefánsson was "developing technology and/or source code and innovating on behalf of another entity" while employed at the company.
[7]
The complaint goes on to argue that there is a "real and immediate threat" that he could use NetApp's trade secrets to give VAST a shortcut to a competing product, potentially damaging existing partnerships and undermining years of internal research.
[8]HP settles fake discount lawsuit for just $4M. Don't expect much of a payout
[9]Oracle faces Texas-sized lawsuit over alleged cloud snafu and radio silence
[10]$380M lawsuit claims intruder got Clorox's passwords from Cognizant simply by asking
[11]Suetopia: Generative AI is a lawsuit waiting to happen to your business
According to the filings, NetApp sent Stefánsson cease-and-desist letters shortly after discovering the alleged activity. The company says that rather than comply, he left the United States for Iceland, prompting it to seek emergency relief from the court. That request was successful. A judge granted a temporary restraining order prohibiting Stefánsson from using NetApp's proprietary material, engaging in any work related to products or software he developed while employed there, soliciting NetApp business partners, or destroying or disposing of documents relevant to the case.
The temporary order is set to expire on November 26, and NetApp says it intends to argue for it to be converted into a preliminary injunction. If granted, that would extend the restrictions through the duration of the litigation.
The complaint does not spell out how the alleged conduct was first uncovered, but the filings argue that the "compressed timeline" from Stefánsson's resignation to Red Stapler's sale speaks for itself. For now, the only certainty is that the dispute has escalated from internal HR alarms to full-blown federal litigation, with NetApp seeking to shut down what it claims is an illicit pipeline of its intellectual property into a competitor's product roadmap.
As the restraining order ticks toward its November 26 expiration date, the next hearing will determine whether the court agrees that the risk to NetApp is urgent enough to warrant keeping Stefánsson on legal ice for the long haul. ®
Get our [12]Tech Resources
[1] https://www.theregister.com/Tag/VAST%20Data/
[2] https://regmedia.co.uk/2025/11/18/netapptradesecretssuit.pdf
[3] https://pubads.g.doubleclick.net/gampad/jump?co=1&iu=/6978/reg_onprem/storage&sz=300x50%7C300x100%7C300x250%7C300x251%7C300x252%7C300x600%7C300x601&tile=2&c=2aRymJWAMIC9ZKVSh0rsnsgAAAEo&t=ct%3Dns%26unitnum%3D2%26raptor%3Dcondor%26pos%3Dtop%26test%3D0
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[7] https://pubads.g.doubleclick.net/gampad/jump?co=1&iu=/6978/reg_onprem/storage&sz=300x50%7C300x100%7C300x250%7C300x251%7C300x252%7C300x600%7C300x601&tile=3&c=33aRymJWAMIC9ZKVSh0rsnsgAAAEo&t=ct%3Dns%26unitnum%3D3%26raptor%3Deagle%26pos%3Dmid%26test%3D0
[8] https://www.theregister.com/2025/04/19/hp_deceptive_pricing_lawsuit/
[9] https://www.theregister.com/2025/04/02/oracle_breach_class_action/
[10] https://www.theregister.com/2025/07/23/lawsuit_clorox_vs_cognizant/
[11] https://www.theregister.com/2025/08/12/genai_lawsuit/
[12] https://whitepapers.theregister.com/
Re: Employment
Anonymous Coward
This is all well and good, but it doesn't really sound very applicable to this case based on what we can currently see.
Re: Employment
elsergiovolador
It’s absolutely applicable. The whole point is that when you sign the usual corporate boilerplate, you’re handing them the ammunition for exactly this kind of courtroom circus. Whether he actually built anything early or not almost doesn’t matter once the contract gives the company sweeping claims over your time, your ideas, and your movements after you leave.
People keep acting shocked when these clauses get weaponised. That’s the warning. If you sign away autonomy, you shouldn’t be surprised when the employer treats every spark of creativity as contraband the moment you walk out the door.
Ouch
Anonymous Coward
Someone's gonna have some very sleepless nights over this one
"rather than comply, he [Stefánsson] left the United States for Iceland,"
Bebu sa Ware
Presumably leaving NetApp and VAST Data to slog it out in the mire of US litigation.
I would imagine he managed to exfiltrated most of his contestably illgotten gains out of the reach of US courts.
If I were in his shoes I might explore a consultancy stint in the PRC until this inconvenience has largely blown over.
Employment
Talented people keep learning this lesson the hard way. If you’ve actually got ideas worth anything, the worst place to be is chained to an employment contract with clauses written like you’re joining a medieval guild. Unless they’re handing you a serious equity package, the deal is simple: you build their empire, they own your brain.
The first thing any sane tech worker should do is strike out every non-compete, every “we own anything you think about on a Sunday evening” clause, and anything that tries to treat your personal projects as company property. If they won’t budge, you walk. That’s exactly why big firms spent years lobbying for things like IR35: clamp down on autonomy, kill the contractor route, and make sure the talent pool can’t take their ideas elsewhere.
In IT, the only arrangement that actually respects boundaries is a clean contract: limited scope, no fishing rights over your future, and no attempt to own your private work. Employment is fine for people who want a desk and pizza Fridays, not for people who build things.