updated 7/29/2005 8:52:17 AM ET 2005-07-29T12:52:17

A judge has temporarily barred a former Microsoft executive from performing his job at the Internet search engine company.  The judge says Microsoft has a well-grounded fear that leaked trade secrets could hurt its business.

The temporary restraining order prohibits Kai-Fu Lee from performing any duties at Google that are similar to those he performed at the software maker.

Microsoft says it has confidentiality and noncompetition agreements with Lee.

Google hired Lee to lead a research and development center it will soon open in China.  The company says Lee has not disclosed any Microsoft secrets and has filed a counter lawsuit against the software giant.

The judge's ruling will stand until a September sixth hearing.

Microsoft Corp. sued Lee, one of its former executives, and Google last week, claiming that by taking the Google job, Lee was violating an agreement he signed in 2000 barring him from working for a direct competitor in an area that overlapped with his role at Microsoft. 

(MSNBC is a Microsoft-NBC joint venture.)

"This lawsuit is a charade," Google said in court documents filed before a Wednesday hearing in Seattle. "Indeed, Microsoft executives admitted to Lee that their real intent was to scare other Microsoft employees into remaining at the company."

Google countersued last week, seeking to override Microsoft's noncompete provision so it can retain Lee.

"In truth, Kai-Fu Lee's work for Microsoft had only the most tangential connection to search and no connection whatsoever to Google's work in this space," the Mountain View, Calif. based company said in court documents.

Superior Court Judge Steven Gonzalez heard arguments in the case in Seattle on Wednesday, and said he expects to issue a ruling Thursday.

Google's filings include details about a conversation Lee had with Microsoft Chairman Bill Gates, suggesting that the software company is becoming increasingly concerned about Google siphoning away talent _ and perhaps intellectual property.

In a July 15 meeting, Lee said, Gates told him, "Kai-Fu, (CEO) Steve (Ballmer) is definitely going to sue you and Google over this. He has been looking for something like this, someone at a VP level to go to Google. We need to do this to stop Google."

Microsoft spokeswoman Stacy Drake declined to comment on Gates' statement directly. "Our concern here is the fact that Dr. Lee has knowledge of highly sensitive information both of our search business and our strategy in China," she said.

Lee claims that Google didn't recruit him and has not encouraged him to violate any agreement he had with Microsoft.

Microsoft counters that Lee's job with Google gives him ample opportunity to leak sensitive technical and strategic business secrets. Microsoft noted that Lee attended a confidential, executive-only briefing in March, dubbed "The Google Challenge."

"In short, Dr. Lee was recently handed Microsoft's entire Google competition 'playbook,'" Microsoft said.

Lee joined Microsoft in August 2000, after he helped establish the company's research center in China. At one point, Microsoft said, he was in charge of the company's work on MSN Search.

Microsoft and Google, along with Yahoo Inc., are locked in a fierce battle to dominate search, both online and through desktop search programs. Google has begun offering new services, including e-mail, that compete with Microsoft offerings.

Microsoft said it paid Lee well in exchange for his promises to honor confidentiality and noncompete agreements. The company said Lee made more than $3 million during nearly five years in Redmond, and that he earned more than $1 million last year.

Microsoft claims there is "an extremely close nexus" between the work Lee did at Microsoft and what he will be doing at Google.

Google argued otherwise, insisting that Lee is not a search expert and noting that his most recent work at Microsoft was in speech recognition.

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