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Novell sues ex-employees

The software giant files a lawsuit against former employees who've launched a start-up to develop a competing clustering product.

Novell (NOVL) is set to fight a trade-secrets suit against former Novell engineers who launched a start-up that competes directly with Novell.

The suit was filed Tuesday in a Utah District Court against former employees Jeff Merkey, an architect of Novell's Wolf Mountain Project, and Darren Major, former senior research scientist. The suit alleges that the two breached their Novell employment contract and fiduciary duties as employees, misappropriated trade secrets, and infringed on the project's trademark name, according to David Bradford, Novell general counsel.

Merkey left Novell last week to join the two-month-old Wolf Mountain Group as chief executive; Major is the start-up's president and chief operating officer. Wolf Mountain Group is developing clustering software, technology to group a number of servers running a variety of operating system and allow them to worth together as a single unit.

This is the same kind of technology the engineers were working on at Novell. The start-up even is using the same name, Wolf Mountain, that Novell has been using to refer to its clustering project.

The court has issued a 10-day temporary restraining order that prevents the start-up from using the Wolf Mountain Group name, maintaining a Web site with the name, or using any trade secret technology from Novell.

Armed with search warrants, the county constables and Novell security officers raided the homes of Merkey, Major, and Larry Angus, another former Novell employee who has joined the company.

"They raided our house like we were criminals," said Major. "They took several of my personal computers and servers and floppies. I think they're trying to get criminal charges against us and were looking for Novell source code. But we don't have any and don't need their code."

Major said that Novell does not own the concept of clustering and that as employees they have a right to continue in the line of work they are familiar with, providing that they honor their Novell agreements and safeguard Novell's trade secrets.

A hearing is set for next Wednesday to decide whether the court should issue a preliminary injunction against the company, said Dade Rose. Rose, an attorney with Van Cott, Bagley, Cornwall & McCarthy in Salt Lake City, Utah, is representing the start-up.

Meanwhile, Novell's Bradford said the company has not filed criminal charges at the present time.

But Bradford implied that the Merkey and Major must have taken source code with them when they left Novell: "It would have taken them two years to develop the clustering technology." The start-up says it will release a clustering product for Windows NT by the end of the year and will announce details about its plans next week.