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Comment by himaraya | Hacker News Reader

> What Bloomberg Intelligence Says

"A potential return of Sam Altman as OpenAI’s CEO will likely strengthen Microsoft’s strategic positioning, especially if it’s able to procure a seat on the new board. This could also be the preferred outcome for Microsoft, given a high legal risk if it hires a majority of OpenAI employees. We see little to no likelihood that Microsoft will buy OpenAI amid ongoing regulatory hurdles."

— Anurag Rana and Andrew Girard, analysts

https://www.bloomberg.com/news/articles/2023-11-21/altman-op...

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> given a high legal risk if it hires a majority of OpenAI employees

What legal risk would that be? All they have to do is to claim that they are protecting their interests, besides it is not as if Microsoft has ever been afraid of a legal challenge.

MS and OpenAI certainly have non-solicitation clauses in their contracts. MS could afford the legal battle but isn't it better for them to wait it out and see what happens first?

https://twitter.com/kevin_scott/status/1726971608706031670

Uh..the CTO of MS saying he will match OAI pay and will support their mutiny uh...definitely is solicitation.

The letter from OpenAI employees to the board expressly says:

"We, the undersigned, may choose to resign from OpenAl and join the newly announced Microsoft subsidiary run by Sam Altman and Greg Brockman. Microsoft has assured us that there are positions for all OpenAl employees at this new subsidiary should we choose to join."

I think it's safe to say there probably isn't any non-solicitation clause; or at least, it's a very weak one or specific one that Microsoft isn't violating (i.e. you won't reach out over LinkedIn).

Non-solicitation agreements are like super-illegal in California. See the "wage fixing" case against Apple, Google, Adobe, Pixar, Intuit, and Intel.

It is different between JV partners or between vendor and customer . If non solicit agreement were not legal for those , consulting companies either tech or management consulting will not be able to operate at all .

JV partners are entirely different form consulting arrangements though and these are some pretty exceptional circumstances.

Do you mean to say that if non-solicitation agreements were entirely unenforceable, consulting companies would see all of their best consultants poached by clients?

Unlikely. Non-poaching agreements are illegal under federal antitrust law.

Nonsense.

I've yet to see a more clear example of solicitation and MS is very much out front with this, presumably their ability to protect their interest in OpenAI outweighs the risk that the competition (Google, etc) would snap up the employees. Think of it as a stop-gap move to ensure that people won't leave and it looks different already. If there is any legal risk (which I doubt) then it is more than offset by their most simple excuse to ignore it, besides the legalities involving non-poaching agreements to begin with.

Are non-solicitation clauses legal?? one between AAPL and GOOG were illegal.

They usually are not.

I'm quite surprised by this, if only because of the regularity with which they appear in standard software consulting agreements.

That depends very much on the locality. What's legal in one country will get you in serious trouble in many others.

hi there!

The clauses are common in the UK but I see them all the time from startups incorporated in Delaware. Maybe they're there for the deterrent factor. Also, hi!

Yes, they get put in but if you try to enforce them you'll find that you can't.

We sign contracts with non-poaching elements in them all the time because the companies we look at are afraid that we will use our inside knowledge to go after their best talent. But I suspect that just the basic protections an employee has under employment law would be enough to stop a company from trying to enforce this (we have a term for this in Dutch which is called 'broodroof' but I don't know any good English translation).

That said: for Execs and consultants it is a different matter. But they are not rank-and-file employees.

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