XYZ Tech Corp. is a computer software company that recently recruited a new Chief Technology Officer from a competitor due to his reputation in the industry. Shortly after the CTO started with XYZ, his former employer filed a lawsuit against him, alleging that he was using trade secrets and confidential information to assist XYZ. XYZ was also sued allegedly for tortious interference with contract alleging that XYZ interfered with the employment contract it had with their former employee.
The parties settled the case after XYZ agreed not to use specific systems and programs. It’s worth noting that the defense costs totaled around $275,000, which was fortunately covered by XYZ’s D&O policy. This highlights the importance of having this coverage.
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