Microsoft says it would settle employee case

Microsoft would settle a lawsuit filed against Google if a permanent injunction can be agreed to related to a former Microsoft employee now at Google.

If Google would agree to make a preliminary injunction become permanent in a lawsuit Microsoft filed against it related to a former employee who has gone to work for Google, the matter could be settled, Microsoft said in a statement issued Tuesday.

"We can settle this lawsuit tomorrow if Google will agree to take today's preliminary injunction, keep every word without a single change, and enter it as a permanent injunction that will last until July 18, 2006," Microsoft General Counsel Brad Smith said in the prepared statement. Doing so would sidestep a trial and the need to pay lawyers outside of the company, he said.

Judge Steven Gonzalez of Superior Court of Washington State in King County ruled Tuesday that former Microsoft employee Kai-Fu Lee can use "his general knowledge, personal attributes, general reputation and skills" to recruit and set up staff at a Google research and development facility in China between now and when the lawsuit is scheduled for trial in January.

Lee is not allowed to recruit from Microsoft employees or to use confidential information from Microsoft, the judge ruled. That aspect of the ruling is partly what led Microsoft to declare "victory in court today" after the Tuesday hearing. Lee is not allowed to work on speech, natural language or search technologies at Google, which announced on July 19 that it had hired him as president of its China operations and to open the research and development center, which is set to happen in the third quarter of this year.

He had been corporate vice president of Microsoft's Natural Interactive Services Division and also was involved in Microsoft's China operations. Google's announcement that Lee had been hired prompted Microsoft to file the lawsuit, arguing that he had breached a noncompete and confidentiality agreement he signed when became a Microsoft vice president in 2000. Google and Lee countersued Microsoft in July.

A spokesman for Google did not return a message seeking comment on Microsoft's statement about settling the lawsuit.

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