Judge Bars Former Amazon Exec From Working at Competitor Startup

Jun 13, 2017

Gene Farrell, formerly a vice president at Amazon Web Services, cannot work at Smartsheet, a software startup, at least for now.

A King's County Washington commissioner granted Amazon (amzn) a temporary restraining order to keep Farrell, who become senior vice president of product for Smartsheet as of June 1, 2017, from assuming his duties. The news was first reported by tech site Geekwire and confirmed by Smartsheet late Monday.

AWS filed suit late last week to keep Farrell, who had been vice president of enterprise services at AWS, from working at Smartsheet, which AWS deems a competitor, for 18 months. The company alleges that Farrell cannot fulfill his new duties without breaching his AWS non-compete agreement by disclosing proprietary AWS information.

In this case, Kings County Commissioner Carols Velataqui's ruling will hold for 11 days until another hearing by King County Superior Court Judge Jim Rogers, according to Geekwire.

Related: Non-Competes Are Bad for the Little Guy and Maybe for the Economy as a Whole

On Monday, Smartsheet CEO Mark Mader told Fortune that Smartsheet, which makes collaboration software for workgroups, does not compete with AWS.

Related: AWS Sets Sights On Microsoft Office

But Amazon's cloud unit, which started out offering basic computing building blocks—servers, networking, and storage—to other companies, has been adding higher level software for business workers including WorkMail email and Chime conference calling. Many expect AWS will come out with productivity software that competes directly with Google (goog) G Suite and Microsoft (msft) Office 365.

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Companies often require new hires to sign non-compete agreements as a condition of employment. The contracts are intended to keep the employee from working for a competitor for periods ranging from 12- to 18-months. Opponents say they limit employee mobility and productivity; proponents say companies should be able to reap the rewards of training employees.

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