Can employees start out on their own while still employed?

Apple’s lawsuit against an ex-employee has raised many questions.


When a former architect in Apple’s custom processors wing left the Company after nine years to start his own venture, he was sued by Apple for breaching an intellectual property agreement and accused him of being disloyal. Attorneys of the employee, Gerard Williams, will be arguing in favour of employees who plan their own startups while still working for a particular organisation.

The lawsuit against Williams, who ended up as a competitor, will have implications for all California-based employees who are planning startups of their own. The public policy of California has always supported employees’ mobility unlike other states that go for agreements disallowing the same.

Gerard Williams III, left Apple to launch Nuvia Inc., a company that designs and chips for servers. He is said to have planned this startup while he was still designing processors for iPads and iPhones at Apple. He is alleged to have spent a long time on the phone with co-workers during working hours, and eventually convinced some of his colleagues to join his startup.

The judge not only allowed the case to proceed but prevented Apple from seeking damages.

Apple’s complaint is that at the time of joining, Williams had signed an agreement that he “will not plan or engage in any other employment” that will be a rival for Apple. However, Williams’ argument is that Apple cannot enforce its contract or agreement, because California law permits employees to plan and prepare for their own startups while still on the rolls of their current employers.

The tentative ruling by the Judge said that no employees are allowed to plan and prepare to create a competitive enterprise before being terminated if they are doing it during their employer’s time and using their employer’s resources.”

Considering that in this modern age, employees often work beyond the regular working hours, it will be quite a challenge to establish how many hours Williams spent on planning his own venture from his personal time and Apple’s (official) time.

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