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IBM Files Breach of Contract Lawsuit Against Former Employee

Posted on Jan 01, 2016

In a lawsuit filed in the U.S. District Court for Southern New York on March 16, IBM asserts a breach of contract claim against its former Vice President of its federal healthcare market, Thomas Romeo. The company alleges that Mr. Romeo refused to pay back retention bonuses after he left IBM and joined Accenture. He resigned from IBM in November 2009. IBM further states in its lawsuit that under the terms of the company’s incentive plans, Mr. Romeo must pay back approximately $165,000 in stock awards since he left and began working for a competitor. 

Surprisingly, this bold action is not the first time that IBM has sued a former employee. The company as sued former high-level employees five times in recent years for breach of contract. In addition to Mr. Romeo, IBM has also filed suit against:

  • David Johnson, after Mr. Johnson left IBM to become the new head of Dell’s mergers and acquisitions unit.
  • Mark Papermaster, after Mr. Papermaster left IBM to become the head of iPhone engineering at Apple.
  • Joanne Olsen, after Ms. Olsen left IBM to lead the cloud software unit at Oracle.
  • Sam Khanna, after Mr. Khanna began working for Unisys.

Ms. Olsen, Mr. Khanna, and Mr. Papermaster each reached settlement agreements with IBM. The judge presiding over the breach of contract claim against David Johnson ultimately held that his contract with IBM did not preclude him from working at Dell.

For more information about lawsuits between employers and employees and other business litigation matters, contact a New York breach of contract lawyer at (888) 497-3410.

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