The $3 million bond is designed to pay for any costs or damages that Papermaster might suffer if it’s later determined that IBM wasn’t entitled to an injunction. Karas noted that district courts are allowed “wide discretion” in setting the bond’s dollar figure, then added: “Based on a careful reading of the letters sent by the parties to the court, which are being filed under seal, the court finds that a bond in the amount of $3 million is appropriate to guarantee payment of the costs and damages that defendant may suffer, if the injunction should not have been issued.” Papermaster,  today, counter-sued IBM saying  that non-compete clause he signed with IBM is irrelevant because:

  1. Apple and IBM aren’t direct competitors
  2. The agreement only applies in New York, not in California or Texas who have much more lax laws and would be where Papermaster was hired and would now be working respectively.
  3. The agreement’s interpretation is too broad, the time is too long. How long will IBM pursue Mark Papermaster.  Prospective hires have to be worried about their eerily harsh tactics in punishing an exiting employee.