VMware has initiated legal proceedings against its former Chief Operating Officer (COO) Rajiv Ramaswami for what it called material and ongoing breaches of his legal and contractual duties and obligations to VMware.
Indian-born Ramaswami had left VMware to become CEO of data center software and services company Nutanix on December 10. Ramaswami had succeeded Nutanix co-founder Dheeraj Pandey.
In conjunction with the filing, VMware has issued the following statement:
“Rajiv Ramaswami failed to honor his fiduciary and contractual obligations to VMware. For at least two months before resigning from the company, at the same time he was working with senior leadership to shape VMware’s key strategic vision and direction, Mr. Ramaswami also was secretly meeting with at least the CEO, CFO, and apparently the entire Board of Directors of Nutanix, Inc. to become Nutanix’s Chief Executive Officer. He joined Nutanix as its CEO only two days after leaving VMware.
“Mr. Ramaswami demonstrated poor judgement and had a clear and extended period of conflict of interest. He should have disclosed this conflict of interest to VMware so that the company could have taken steps to protect itself. But he did not notify VMware, and thus deprived the company of the ability to do so by concealing his Nutanix-related activities.
“VMware expects all employees to honor their commitments to the company, and executive officers should be held to an even higher standard.
“VMware is not a litigious company by nature. Indeed, the company tried to resolve this matter without litigation. But Mr. Ramaswami and Nutanix refused to engage with VMware in a satisfactory manner.
“VMware spends billions of dollars on its roadmap and R&D to bring market innovations to our customers and is committed to protecting our brand, the technological innovations behind our brand, and the value we bring to our customer.”
In a statement, Nutanix said that VMware’s action is misguided action and is in response to losing a deeply valued and respected member of its leadership team. It is disappointing to see VMware’s management sue him just because he chose to pursue an opportunity to become a public company CEO.
We believe that VMware’s action is nothing more than an unfounded attempt to hurt a competitor and we intend to vigorously defend this matter in court, said Nutanix.