Revolving Doors: Stuck in the Middle… More Trouble for Nortel

Further to our ‘Revolving Doors’ story dated 20 October it now emerges that Motorola has gone to court to block Nortel’s plan to hire its former president and COO Mike S. Zafirovski as the newest Nortel president and CEO, charging that if Zafirovski goes to work for Nortel, it will inevitably result in the use or disclosure of Motorola’s trade secrets.

Zafirovski signed multiple non-compete agreements during his tenure there, Motorola claims in its lawsuit, and was paid “well over $30 million” in cash, stock and options in return – the proverbial “golden handcuffs.”

Motorola’s lawsuit, filed in the Circuit Court of Cook County, Ill., asks for injunctions barring Zafirovski from working for Nortel for two years, from soliciting or hiring Motorola employees, and from utilizing or disclosing Motorola’s confidential information. Zafirovski is supposed to take the helm at Nortel – becoming its third CEO in just 19 months – on Nov. 15

The suit does not name Nortel itself, but rather Zafirovski and his “employers.” However Nortel, in a brief statement disclosing the existence of the lawsuit, said that it and Zafirovski “are currently reviewing the lawsuit and intend to pursue discussions with Motorola with a view to resolving the dispute over Zafirovski’s appointment.”

Zafirovski is supposed to replace Bill Owens, the former vice chairman of the U.S. Joint Chiefs of Staff who was recruited by Nortel last April to help the company through the financial accounting morass it was in over misreported results for five years. That debacle saw 10 of the company’s top executives ousted, including former CEO Frank Dunn. Owens had been putting together a turnaround plan and had been rebuilding management, but those efforts faltered back in June when two senior executives, President Gary Daichendt and CTO Gary Kunis, left after only three months on the job.