Google and its poached Paypal employees got sued for trade secret misappropriation yesterday, but we didn’t know the dirty details beforehand. A peek at PayPal’s complaint reveals there is a bit more to the tale. Apparently, Paypal and Google were in talks last year to take advantage of PayPal for payments within the Android Market. Osama Bedier was in control of those negotiations for PayPal in October of 2010, when the deal was presupposed to close, but was allegedly interviewing for a mobile payment position at Google collectively (holy conflict of interest, Batman!). The complaint claims that Bedier initially rebuffed El Goog’s advances, told PayPal of the job offer and professed that he would stay, but jumped ship a month later (bringing some PayPal coworkers with him) after being recruited by Stephanie Tilenius and the almighty dollar. Once it hired Osama, Google put the brakes at the PayPal deal and created Google Wallet . Then Google, Bedier, and Tilenius got slapped with a lawsuit. a short lived rundown of the legal claims awaits you after the break.
In California, information is a protected trade secret if it’s economically valuable, isn’t generally known, and its owner has made reasonable efforts to maintain it secret. Additionally, contracts preventing employee poaching are enforceable in Cali to the level that they are had to protect trade secrets possessed by those employees. PayPal’s plans and mobile payment strategies will surely be valuable to its competitors, and it keeps its institutional info classified with employee confidentiality clauses and customer non-disclosure agreements. So, PayPal appears to have a beautiful strong argument for trade secret protection, and its breach of contract claims against Bedier and Tilenius for soliciting PayPal employees are looking good too.
Needless to say, that assumes Osama, actually, used (and is using) his knowledge of PayPal’s mobile payment plans to create Google Wallet — and that he breached his duty of loyalty when he got himself and others hired by El Goog rather than doing the Android deal. And, if the complaint is to be believed, Ms. Tilenius and Google are at the hook for inducing him to do these dastardly deeds. PayPal paints quite the image of corporate intrigue, but it will be interesting to work out how the parents from Mountain View respond. The true question is, can Google Wallet pay legal fees?
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