Ex-IBM staffer files lawsuit claiming company stole his cloud computing tech IP
(2021/03/25)
- Reference: 1616700913
- News link: https://www.theregister.co.uk/2021/03/25/ibm_hayden_complaint/
- Source link:
IBM's cloud business is the subject of a [1]complaint [PDF] filed by a former employee of Big Blue who alleges the company lifted his technology and then fired him.
The complaint, filed in the United States District Court for the Southern District of New York, and not yet served on IBM, makes some hefty accusations concerning the theft of trade secrets and intellectual property.
[2]
According to the document, the plaintiff, Gerald Hayden, is a veteran of the global banking and financial sectors. As well as putting in time at the institution now known as Bank of America and MetLife, "he was also co-author of WebSphere at IBM in the 1990s."
Having served just under two years during his first stint at IBM, Hayden then spent a decade at Cisco, leaving in 2009. Over this 10-year period, his lawyers claim, he developed "a revolutionary business methodology" called "Awareness to Execution" (A2E) and its derivative "Efficiency, Effectiveness, Real Time" (EERT)
[3]
The crux of A2E, as far as we could make out from the suit, is a methodology aimed at integrating client workflows over siloed departments and divisions to speed decision making based on real-time customer and industry data.
No patents were cited in the document, however.
Ahead of rejoining IBM, the document claims, "Hayden used A2E on behalf of a number of other large financial services clients" under NDA.
"A2E," the complaint adds, "enabled Hayden to stand out from other consultants in the financial services field."
In 2015 Hayden signed up with Big Blue once again and went through the training processes familiar to many new starters. IBM assured staff, his legal eagles say in the document, that it "was committed to protecting trade secrets of third parties including its own employees and that it had developed strong procedures to achieve this."
Hayden, "was also told that he should disclose generally any trade secret or other intellectual property that he had developed prior to coming to IBM, and that IBM would protect it and ensure that no other employee would use it without his permission."
Having listed A2E as pre-existing intellectual property, Hayden got to work attracting banking clients to IBM's world and promoting his A2E methodology "with potential IBM banking clients for the mutual benefit of IBM and Plaintiff [Hayden]."
What could go wrong? Hayden believed that "A2E" was protected, IBM would score increased revenues, everyone would be happy, right?
"Plaintiff Hayden," the complaint alleges, "however, did not realize he was swimming with sharks."
As the contracts and cash began rolling in, according to the complaint, Hayden began to get cut out of the picture. A2E sales and development moved away from his division, the methodology was incorporated into other areas of IBM, and his clients were moved elsewhere.
"IBM thus used A2E's value proposition to drive IBM's claimed reinvention of itself as a leader in the hybrid cloud computing industry and as an invaluable consultant to the financial services industry."
And Hayden? Without a client base and his A2E methodology now circulating within the corridors of IBM, he was allegedly terminated for "lack of work."
The sueball states that, after the termination "IBM intentionally released portions of A2E in the marketplace through white papers," in an effort to show off its smarts and thus bring new business to its hybrid cloud model.
The complaint adds that "to facilitate new customers' use of A2E, IBM acquired open-source tech company Red Hat."
We'd contend the [4]2018 acquisition might have had more to do with Big Blue's flailing in the cloud world, but that is something for the lawyers to sort out.
While IBM, according to Hayden, had made and stood to make billions from the A2E "trade secret", the plaintiff had been left "without employment and possessing intellectual property which has been widely disseminated and rendered essentially valueless."
Hayden is seeking damages including (but not limited to) a share of profits from a selection of IBM business areas, including Hybrid Cloud and Cognitive Enterprise.
The Register spoke to IBM, which told us that it had yet to be served the complaint. Hayden's legal representation has yet to respond to our request for comment.
[5]
In a statement sent, IBM said: "There is no valid claim here. This individual was terminated for legitimate, non-retaliatory reasons unrelaed to his alleged claims, and IBM at no time misused or misappropriatd any of the plaintiff's intellectual property. IBM will vigorously defend itself against these frivolous allegiations in court." ®
Get our [6]Tech Resources
[1] https://regmedia.co.uk/2021/03/25/ibm_hayden_complaint.pdf
[2] https://pubads.g.doubleclick.net/gampad/jump?co=1&iu=/6978/reg_offprem/front&sz=300x50%7C300x100%7C300x250%7C300x251%7C300x252%7C300x600%7C300x601&tile=2&c=2YF0WDnYKOV7OVQSIzDxrVwAAAIg&t=ct%3Dns%26unitnum%3D2%26raptor%3Dcondor%26pos%3Dtop%26test%3D0
[3] https://pubads.g.doubleclick.net/gampad/jump?co=1&iu=/6978/reg_offprem/front&sz=300x50%7C300x100%7C300x250%7C300x251%7C300x252%7C300x600%7C300x601&tile=3&c=33YF0WDnYKOV7OVQSIzDxrVwAAAIg&t=ct%3Dns%26unitnum%3D3%26raptor%3Deagle%26pos%3Dmid%26test%3D0
[4] https://www.theregister.com/2018/10/28/ibm_redhat_acquisition/
[5] https://pubads.g.doubleclick.net/gampad/jump?co=1&iu=/6978/reg_offprem/front&sz=300x50%7C300x100%7C300x250%7C300x251%7C300x252%7C300x600%7C300x601&tile=4&c=44YF0WDnYKOV7OVQSIzDxrVwAAAIg&t=ct%3Dns%26unitnum%3D4%26raptor%3Dfalcon%26pos%3Dmid%26test%3D0
[6] https://whitepapers.theregister.com/
The complaint, filed in the United States District Court for the Southern District of New York, and not yet served on IBM, makes some hefty accusations concerning the theft of trade secrets and intellectual property.
[2]
According to the document, the plaintiff, Gerald Hayden, is a veteran of the global banking and financial sectors. As well as putting in time at the institution now known as Bank of America and MetLife, "he was also co-author of WebSphere at IBM in the 1990s."
Having served just under two years during his first stint at IBM, Hayden then spent a decade at Cisco, leaving in 2009. Over this 10-year period, his lawyers claim, he developed "a revolutionary business methodology" called "Awareness to Execution" (A2E) and its derivative "Efficiency, Effectiveness, Real Time" (EERT)
[3]
The crux of A2E, as far as we could make out from the suit, is a methodology aimed at integrating client workflows over siloed departments and divisions to speed decision making based on real-time customer and industry data.
No patents were cited in the document, however.
Ahead of rejoining IBM, the document claims, "Hayden used A2E on behalf of a number of other large financial services clients" under NDA.
"A2E," the complaint adds, "enabled Hayden to stand out from other consultants in the financial services field."
In 2015 Hayden signed up with Big Blue once again and went through the training processes familiar to many new starters. IBM assured staff, his legal eagles say in the document, that it "was committed to protecting trade secrets of third parties including its own employees and that it had developed strong procedures to achieve this."
Hayden, "was also told that he should disclose generally any trade secret or other intellectual property that he had developed prior to coming to IBM, and that IBM would protect it and ensure that no other employee would use it without his permission."
Having listed A2E as pre-existing intellectual property, Hayden got to work attracting banking clients to IBM's world and promoting his A2E methodology "with potential IBM banking clients for the mutual benefit of IBM and Plaintiff [Hayden]."
What could go wrong? Hayden believed that "A2E" was protected, IBM would score increased revenues, everyone would be happy, right?
"Plaintiff Hayden," the complaint alleges, "however, did not realize he was swimming with sharks."
As the contracts and cash began rolling in, according to the complaint, Hayden began to get cut out of the picture. A2E sales and development moved away from his division, the methodology was incorporated into other areas of IBM, and his clients were moved elsewhere.
"IBM thus used A2E's value proposition to drive IBM's claimed reinvention of itself as a leader in the hybrid cloud computing industry and as an invaluable consultant to the financial services industry."
And Hayden? Without a client base and his A2E methodology now circulating within the corridors of IBM, he was allegedly terminated for "lack of work."
The sueball states that, after the termination "IBM intentionally released portions of A2E in the marketplace through white papers," in an effort to show off its smarts and thus bring new business to its hybrid cloud model.
The complaint adds that "to facilitate new customers' use of A2E, IBM acquired open-source tech company Red Hat."
We'd contend the [4]2018 acquisition might have had more to do with Big Blue's flailing in the cloud world, but that is something for the lawyers to sort out.
While IBM, according to Hayden, had made and stood to make billions from the A2E "trade secret", the plaintiff had been left "without employment and possessing intellectual property which has been widely disseminated and rendered essentially valueless."
Hayden is seeking damages including (but not limited to) a share of profits from a selection of IBM business areas, including Hybrid Cloud and Cognitive Enterprise.
The Register spoke to IBM, which told us that it had yet to be served the complaint. Hayden's legal representation has yet to respond to our request for comment.
[5]
In a statement sent, IBM said: "There is no valid claim here. This individual was terminated for legitimate, non-retaliatory reasons unrelaed to his alleged claims, and IBM at no time misused or misappropriatd any of the plaintiff's intellectual property. IBM will vigorously defend itself against these frivolous allegiations in court." ®
Get our [6]Tech Resources
[1] https://regmedia.co.uk/2021/03/25/ibm_hayden_complaint.pdf
[2] https://pubads.g.doubleclick.net/gampad/jump?co=1&iu=/6978/reg_offprem/front&sz=300x50%7C300x100%7C300x250%7C300x251%7C300x252%7C300x600%7C300x601&tile=2&c=2YF0WDnYKOV7OVQSIzDxrVwAAAIg&t=ct%3Dns%26unitnum%3D2%26raptor%3Dcondor%26pos%3Dtop%26test%3D0
[3] https://pubads.g.doubleclick.net/gampad/jump?co=1&iu=/6978/reg_offprem/front&sz=300x50%7C300x100%7C300x250%7C300x251%7C300x252%7C300x600%7C300x601&tile=3&c=33YF0WDnYKOV7OVQSIzDxrVwAAAIg&t=ct%3Dns%26unitnum%3D3%26raptor%3Deagle%26pos%3Dmid%26test%3D0
[4] https://www.theregister.com/2018/10/28/ibm_redhat_acquisition/
[5] https://pubads.g.doubleclick.net/gampad/jump?co=1&iu=/6978/reg_offprem/front&sz=300x50%7C300x100%7C300x250%7C300x251%7C300x252%7C300x600%7C300x601&tile=4&c=44YF0WDnYKOV7OVQSIzDxrVwAAAIg&t=ct%3Dns%26unitnum%3D4%26raptor%3Dfalcon%26pos%3Dmid%26test%3D0
[6] https://whitepapers.theregister.com/
Richocet
Well he didn't invent this while working at IBM - it was beforehand. So it's not open and shut that IBM owns it unless the contract says otherwise.
Its the downside of being an employee
When you join a company, especially a big,established, one, then you are invariably given a contract to sign. Buried in that contract is the notion that anything you invent while working at that company becomes the company's property. There would be obvious exceptions to the rule -- for example, this employee could claim that the mousetrap he invented and patented in his spare time wasn't IBM's IP and I'd guess that both the courts and IBM legal would agree -- but for the most part the company owns your soul. This is why its important that if you bring significant IP into the company when you hire on you make sure that this is described in that contract. I did this for my last hire, I was hired for specific expertise and with that experise came design and development techniques that were unknown to that company (which is why they needed to hire me.....). I didn't want them turning around a decade later and claiming they owned them (or worse, patenting them).
So this story should be straightforward. Either there was something in the hiring agreement that called out the IP as owned by the plaintiff or there wasn't.