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Terminated Executive Sues Apple

September 24, 1993 GMT

SAN JOSE, Calif. (AP) _ Albert A. Eisenstat, Apple Computer Inc.’s executive vice president and secretary until this week, is one employee laid off during the company’s restructuring who is not going quietly.

Eisenstat, 63, was terminated Thursday as part of the cost-cutting program that has led to 2,000 layoffs so far this year, the company said.

In a complaint filed in Superior Court the same day, Eisenstat sued Apple and chief executive Michael Spindler alleging breach of contract, wrongful termination and age discrimination.

Eisenstat claims he was forced out because he opposed Spindler’s reorganization plans and the repricing of stock-options for employees.

In announcing Eisenstat’s departure on Friday, Apple said the suit had no merit.

Eisenstat was hired in 1980 as Apple vice president, general counsel and corporate secretary by company founders Steve Jobs and Mike Markkula and then- Apple president Mike Scott. He later served in a number of corporate positions, an has been a member of Apple’s board since 1985.

Eisenstat did not return a phone call to his home on Friday.

His attorney, Anthony Trepel of San Jose, said Friday that Eisenstat brought the lawsuit only reluctantly and to protect his interests.

″He was known as the voice of reason at Apple. We don’t know all the reasons he was abruptly terminated,″ Trepel said.

Apple defended the move and said Eisenstat’s termination was part of a series of layoffs announced last summer to cut costs.

″Mr. Eisenstat’s position was eliminated. He was offered the opportunity to fully participate in an executive severance program. He declined because he felt the compensation offered was insufficient,″ said Apple spokeswoman Kate Paisley.

Eisenstat in recent years has been one of the top-paid executives in Silicon Valley. In 1992, he received cash compensation of $749,164, and from 1990 and 1992 he received bonuses of $760,000 plus stock options, Apple said.

″He thinks he should have been employed indefinitely,″ Paisley said.

But Eisenstat’s complaint lists a number of allegations that go beyond concerns about compensation.

It claims that Spindler, who replaced Apple board chairman John Sculley as chief executive in a June shakeup, misled Eisenstat about the long-term security of his employment with Apple.

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After Spindler was elevated to CEO he announced his reorganization plans and a proposal to reprice stock options to board members.

″It became clear in these discussions and proposals that contrary to representations made to (Eisenstat), Spindler intended to exclude him from any key position in Apple,″ the lawsuit claims.

In the weeks that followed the reorganization, Spindler and others at Apple ″targeted″ Eisenstat for termination in violation of a years-old policy that had virtually guaranteed Eisenstat permanent employment, the lawsuit claims.

The lawsuit seeks unspecified damages from Apple, punitive damages for mental anguish, pain and suffering, and reimbursement of attorneys’ fees and court costs.