Company Sues Former Executive for Alleged Breach of Non-Compete
Posted on Jan 01, 2016
In a recent U.S. District Court filing, Cognizant Technology Solutions accused a former company executive of violating non-compete agreements. The non-compete agreements were allegedly crafted when the former executive sold the company that he co-owned to Cognizant for $25 million. Shortly after the sale, Cognizant alleges that the executive, Robert Kreft, began “laying the groundwork” for a competing business.
Cognizant purchased Mr. Kreft’s company, Zaffera, LLC, in September of 2011. He received $6 million as a result. At the time, Zaffera possessed a “critical mass of hard-to-find resources and marketable intellectual property.” Following the acquisition, Mr. Kreft stayed with Cognizant in order to help run the business that he had founded and sold to the company.
Cognizant asserts that Mr. Kreft began helping and creating a competing business, Vibrao, 8 months after the sale of Zaffera. He began marketing the services of his new business while also recruiting a Zaffera employee who had followed Mr. Kreft to Cognizant. In response, Cognizant sent Mr. Kreft a cease and desist. Mr. Kreft responded only by briefly taking down the Vibrao website. His name continued to appear in testimonials on the site about the quality of his work, despite his claim that he had divested himself of Vibrao.
In his defense, Mr. Kreft asserts that he has removed himself from Vibrao. He further states that when he does work with Vibrao, he does not work in the retail software area that is covered by the terms of his non-compete agreement. He accuses Cognizant of being “vindictive.”
Contact a New York non-compete attorney today at (888) 497-3410 for more information about this and other business litigation matters.