In recent weeks, we have been following the fascinating case between Massachusetts-based EMC Corp. and Hewlett Packard Co., located in California. EMC won the first round by stopping a former executive, David Donatelli, who was VP in charge of EMC’s Storage Division, from starting his job at HP. The Massachusetts Court held that to allow Donatelli to work for HP would violate a non-compete agreement he signed at EMC. The Massachusetts Court enforced the non-compete even though Donatelli had filed an action for declaratory relief in California asking that Court to declare the non-compete unenforceable under California law. In the Massachusetts action, however, the Judge allowed Donatelli to present additional evidence in a subsequent hearing to demonstrate that his job at HP would have minimal overlap with his former position at EMC.
On May 26, 2009, after hearing additional evidence, the Massachusetts Court modified the preliminary injunction it had issued against Donatelli by allowing him to start working for HP in California. However, both sides are claiming victory because Donatelli will not be able to take the job he wanted, i.e., Executive VP of StorageWorks, due to the restrictions in the order. While HP expressed its pleasure with the Court’s decision to allow Donatelli to start working at HP as a Senior VP of Enterprise Servers and Networking, EMC stated it was also pleased with the Court’s ruling because it upheld “the terms of EMC’s key employee agreement.” EMC’s statement went on to say that, “The judge entered an order as proposed by EMC that precludes Mr. Donatelli from being engaged in any aspect of HP’s business that overlaps or competes with EMC’s storage business for a 12-month period.” The case is EMC Corp. v. David A. Donatelli, case number 09-1727-BLS2 in the Suffolk County Superior Court in Massachusetts.
We don’t know if the case is over, but for now, it appears that everyone got something of value from the case. The Massachusetts Court issued a narrow order tied to the protectable interest of EMC while at the same time, not depriving Donatelli his opportunity to pursue his livelihood in a competitive business.