Earlier this month, when Nutanix announced it was hiring former VMware COO Rajiv Ramaswami as CEO, it appeared like an excellent match. What’s extra, it pulled a key participant from a market rival. Effectively, it appears VMware took exception to dropping the manager, and filed a lawsuit in opposition to him yesterday for breach of contract.
The corporate is claiming that Ramaswami had inside information of the important thing plans of his former firm and that he ought to have informed them that he was interviewing for a job at a rival group.
“Rajiv Ramaswami didn’t honor his fiduciary and contractual obligations to VMware. For at the very least two months earlier than resigning from the corporate, on the similar time he was working with senior management to form VMware’s key strategic imaginative and prescient and path, Mr. Ramaswami additionally was secretly assembly with at the very least the CEO, CFO, and apparently all the Board of Administrators of Nutanix, Inc. to turn into Nutanix’s Chief Government Officer. He joined Nutanix as its CEO solely two days after leaving VMware,” the corporate wrote in an announcement.
As you’ll be able to think about, Nutanix didn’t agree, countering in an announcement of its personal that, “VMware’s lawsuit seeks to make interviewing for a brand new job wrongful. We view VMware’s misguided motion as a response to dropping a deeply valued and revered member of its management staff. Mr. Ramaswami and Nutanix have gone above and past to be proactive and cooperative with VMware all through the transition.”
On the time of the hiring, analyst Holger Mueller from Constellation Analysis famous that the 2 corporations had been major opponents and hiring Ramawami was was a giant win for Nutanix. “So hiring Ramaswami brings each an knowledgeable for multicloud to the Nutanix helm, in addition to weakening a key competitor from a expertise perspective,” he told me earlier this month.
Mueller doesn’t see a lot likelihood of the go well with succeeding. “It’s been a very long time for the reason that final lawsuit occurred in Silicon Valley [involving] a tech exec leaping ship. Being an ’employment at will’ state, these fits are sometimes unsuccessful,” he informed me this morning.
He added, “The attention-grabbing a part of the VMware v. Nutanix lawsuit is, does a high-ranking government interviewing with a competitor equal a break of confidentiality by itself, or does materials data should be breached to succeed in the purpose. Historically the suitable to (confidentially) interview has been protected by the courts,” he mentioned.
It’s unclear what the tip sport could be in the sort of authorized motion, but it surely does complicate issues for Nutanix because it transitions to a brand new chief government. Ramaswami took over from co-founder Dheeraj Pandey, who introduced plans to depart the publish final summer time.
The lawsuit was filed Monday in Superior Courtroom of the State of California, County of Santa Clara.