The court ruled former EMC storage division president David Donatelli could not proceed with plans to start a job on Tuesday as head of HP's storage, server and networking groups, until the two companies resolve a legal dispute over the terms of a non-compete clause he signed with EMC.
An HP spokesperson said Donatelli, who had been with EMC for 22 years, would not start his new position on Tuesday as planned.
We are disappointed that the Massachusetts court saw fit to delay Mr. Donatelli's employment with HP, she said. However, the court's order is preliminary and we are confident that Mr. Donatelli will be permitted to join HP in a leadership role once a full hearing of the issues is held.
A spokesman for EMC declined comment. Donatelli and his attorneys could not be reached.
EMC filed a lawsuit in Massachusetts last week and sought the preliminary injunction to bar Donatelli from taking the job. The suit cited a non-compete clause in his employment agreement.
Donatelli filed suit in California, which generally does not recognize non-compete clauses, seeking to dissolve that agreement.
The court concludes that the covenant which Donatelli signed is an enforceable contract, is not unreasonably broad (at least on its face) and serves legitimate business interests of EMC, Stephen Neel, Justice of Massachusetts Suffolk County Superior Court, said in the order issued on Monday.
Donatelli's intention to work for HP in California, which has a statutory prohibition on covenants not to compete, does not warrant denial of EMC's request for injunctive relief.
Donatelli ran EMC's biggest unit, whose sales accounted for about three quarters of the $14.9 billion in revenue EMC rang up last year.
EMC is the top maker of corporate data storage equipment, claiming 22.4 percent of a market worth $20.1 billion last year, according to market researcher IDC. IBM was second with 13.4 percent of the market, followed by HP with a 12.7 percent share.
Last week, HP named Donatelli executive vice president of enterprise servers, storage and networking, replacing Scott Stallard, who is retiring after 34 years with the company.
(Editing by Andre Grenon)