Coverage: Amazon sues Target-bound former executive
Arthur Valdez worked for Amazon for 16 years before accepting a job with Target, but his dealings with the Seattle-based company are far from over.
On Tuesday, Amazon sued Valdez for breaching his non-compete contract and accused him of revealing trade secrets during his interview process with Target.
Phil Wahba of Fortune had the day’s news:
Amazon.com is not amused.
Last month, Target said it was hiring a star supply chain and logistics executive away from the online retailer as it looks to address its out-of-stock problems.
This week, Amazon sued the executive, Arthur Valdez, to stop him from starting his new job with the discount retailer, claiming a non-compete agreement he signed precludes him from working for any direct rival for 18 months.
Amazon claimed in its lawsuit, which it filed on Monday in Washington Superior Court in its hometown of Seattle, that Valdez shared information with Target he wasn’t supposed to, violating a contract he signed with Amazon in 2012. What’s more, Amazon claimed he would be armed with confidential information about the company as he goes about working for what it called a “key” competitor. The online store said that Valdez shared with his future bosses information on how Amazon handles orders and logistics during the peak holiday season.
Anya George Tharakan of Reuters explained why Amazon is insistent on suing its former employee:
Amazon claims Valdez, whose appointment was announced by Target in February, was privy to confidential information in a highly competitive area for both companies – moving and shipping goods in the most effective manner.
Valdez had been president of operations at Amazon, focusing on the company’s international supply chain expansion.
The lawsuit did not specify when Valdez left Amazon. However, Valdez’s attorney informed Amazon that he would start at Target on March 28, according to the lawsuit.
“We have taken significant precautions to ensure that any proprietary information remains confidential and we believe this suit is without merit,” Target spokeswoman Molly Snyder said.
Nick Halter of the Minneapolis Business Journal showed how hiring away the Amazon executive was a big score for Target:
The online retail giant’s lawsuit claims Valdez broke an 18-month noncompete agreement. Seattle-based Amazon doesn’t want him to be able to begin his Target job until September 2017.
Target hired Valdez as executive vice president and chief supply chain and logistics officer in late February. He is scheduled to start his new job next week, but Amazon said Valdez shared trade secrets with Target during his job interviews, including analysis of Amazon’s holiday shopping operations.
“We have taken significant precautions to ensure that any proprietary information remains confidential and we believe this suit is without merit,” a Target spokeswoman told the Wall Street Journal.
Valdez’s hire has been scored as a big win for Target as it tries to fix its struggling supply chain, which has resulted in out-of-stock merchandise.
Former Amazon logistics executive Ben Conwell praised Target for poaching Valdez a couple days after the hire was announced.
“While it’s Amazon’s loss that Arthur is coming here to Minneapolis, I think it’s an awesome hire for [Target CEO] Brian Cornell, ” Conwell said.”I think he is going to be a tremendous addition to the executive team. He is what I would call a real water walker at Amazon. A real star.”