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Wednesday, July 20, 2005 - Page updated at 10:33 AM

Gone to Google: Microsoft sues over exec's defection

Seattle Times technology reporter

For months, Microsoft has suffered a mini-exodus of top talent to Google. But one departure announced yesterday clearly hurt — so much so that the company sued the outgoing executive and Google, which Microsoft said improperly encouraged the move.

Kai-Fu Lee, a corporate vice president, resigned to open a research center for Google in China, becoming the highest-ranking employee to leave for a company that unmistakably irritates Microsoft's leadership.

Lee, 43, joins several former co-workers in moving to Google's newer — if not greener — pastures. He said yesterday that while he is grateful to Microsoft for all he has learned there, the new job was a once-in-a-lifetime opportunity.

"Everybody I talked to [at Google] really has an incredible passion and excitement," he said, describing the company as "a very collegiate environment in which I think I can really amplify the ideas I have."

Lee was involved in developing the Web search engine that Microsoft officially released in January, in part to better compete with industry-leading Google. Born in Taipei, Taiwan, he also helped lead the company's business strategy in China.

Microsoft lawyer Tom Burt said yesterday that the company knew Lee was going to head an office for Google in China. That alone was enough to cause concern, he said. But Microsoft didn't know exactly what Lee would be doing until company executives read a news release from Google yesterday.

"The job they hired him to do is absolutely in direct competition with the work he was doing at Microsoft," Burt said. "Not only is it at a competitor, it's directly competitive work."

Kai-Fu Lee


Age: 43.

Born: Taipei, Taiwan.

Education: Doctorate in computer science from Carnegie Mellon University, bachelor's in computer science with highest honors from Columbia University.

New job: Leading Google's product research and development center in China, serving as president of Google's Chinese operations.

Old job: Corporate vice president of the National Interactive Services Division at Microsoft.

Accomplishments: Founded Microsoft's Beijing laboratory, which has become one of the key research centers for the company.

Past employers: Silicon Graphics, Apple Computer, Carnegie Mellon

Trivia: Developed a computer program that plays the game Othello. The program defeated the human Othello world champion in 1988.

Sources: Microsoft, Google, Kai-Fu Lee

Lee will lead Google's Chinese research and development center, which is expected to open in the next few months. Google has not said where the office will be located.

Within hours of the hiring announcement, Microsoft filed a lawsuit against Lee and Google in King County Superior Court. To become a vice president at Microsoft, according to the lawsuit, Lee signed an agreement in 2000 that said if he left, he couldn't do any work that competes with Microsoft for one year.

The suit also said Lee was among a small number of executives privy to highly confidential details about Microsoft's business.

His contract said he cannot disclose any of the company's trade secrets or other confidential information. There is no indication, however, that Lee has done so.

The lawsuit also admonished Google, saying the rival essentially should have known better than to encourage Lee to jump ship. Microsoft and Google are trying to recruit employees from each other all the time, Burt said, and Google knows that these kinds of noncompetition agreements are in place.

Injunction may be sought

Suspecting that an announcement was coming, Burt said Microsoft contacted Google on Monday and reminded them of Lee's contract, but received no response. He said Microsoft plans to request an injunction soon to stop Lee's move until the lawsuit is resolved.

There's a certain code of conduct in the technology industry when it comes to luring away an employee, Burt said. An interested company generally comes clean and discloses whom they want to hire. Google didn't do that, he said.

Lee would not comment on Microsoft's lawsuit yesterday. In a written statement, Google said it had reviewed Microsoft's claims and found them to be completely without merit.

"We're thrilled to have Dr. Lee on board at Google," the company said. "We will defend vigorously against these meritless claims and will fully support Dr. Lee."

Noncompete agreements in employee contracts are fairly common, said Steven Winterbauer, a Seattle employment-law attorney. These cases usually end in settlements, he said.

"In my experience, these cases often are as much about emotion as they are about legitimate or justifiable concern regarding a threat to the company," he said. "There's this almost sense of betrayal."

Other defectors to Google include Mark Lucovsky, founding member of the team that created Windows NT; and Joe Beda, who previously worked on a team developing Microsoft's next operating system. Adam Bosworth, a software pioneer at Microsoft, left to start his own company but moved to Google last year. Still others who have held lower-ranking positions at Microsoft are also at Google.

Lee joined Microsoft in 1998 and founded the company's research lab in Beijing. Before that, he had worked at Silicon Graphics and Apple Computer, helping to develop the QuickTime media player and other products.

Reputation for excellence

He was a pioneer in the speech technologies field, having developed such systems while working as an assistant professor at Carnegie Mellon University. After founding Microsoft's Beijing lab, he moved back to Puget Sound and worked again on speech technologies in Redmond.

"Many people consider him sort of the father of speech technology for his work," said Jim Larson, who co-chairs a group that sets standards for the development of speech technologies. "His reputation is widely known."

Recently, however, he began to focus more on Web search, Microsoft said, and at one point was responsible for the overall development of MSN's Web search engine. Microsoft and Google are core rivals in search technologies, although recently the two have begun to compete in other areas, such as e-mail and mapping services.

Kim Peterson: 206-464-2360 or kpeterson@seattletimes.com

Copyright © 2005 The Seattle Times Company


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