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posted by janrinok on Sunday March 01 2015, @11:27PM   Printer-friendly
from the ..it's-always-who-you-know dept.

Two former high-level managers at Microsoft have sued the company, claiming their terminations were in retaliation for raising questions about a well-connected subordinate's expense reports. The subordinate, who is not named in the complaint, allegedly submitted expenses in excess of $22,000 while entertaining Microsoft business partners at South Korean "hostesses bars".

The complaint (embedded in the GeekWire story) provides details. Eric Engstrom and Ted Stockwell both worked for Microsoft throughout the 1990's (the complaint credits Engstrom as being one of the three inventors of the DirectX API), left the company in 1998 or 1999, and returned in 2008 to work in Microsoft's Online Services Division, which was headed by Qi Lu. Engstrom was hired to lead Bing Mobile Program Management; Engstrom hired Stockwell to run a new organization called Bing Mobile International.

Engstrom and Stockwell allegedly created the blueprint for the "Bing as a Platform" (BaaP) initiative within Microsoft in 2010. Shortly thereafter, the unnamed employee ("John Doe") was loaned to Stockwell's fledgling organization by Harry Shum, EVP of Technology and Research; Doe was known to have personal connections to an important Microsoft business partner in Korea. John Doe's expense reports from Korea were submitted to Stockwell for approval.

More down the page...

From the complaint:

Stockwell soon realized that the expense reports Doe had filed were an entire order of magnitude greater than what Stockwell initially understood. Stockwell notified Engstrom, his manager, about the size of the expenses he had approved and told him that he believed Doe was “expensing hostess bars” and potentially prostitution.

The suspicions about the expense reports were reported to Microsoft Human Resources, as well as to Engstrom's superior. An internal investigation was initiated, but an HR representative asked Stockwell to drop the complaint against Doe and to raise his performance rating. Stockwell effectively declined to do so.

Microsoft retained John Doe. The company raised Doe’s performance rating without Stockwell or Engstrom’s involvement, which is a significant departure from company practice. It also permitted Doe to transfer out of the division. Stockwell was told that Harry Shum had stepped in to dismiss the charges against Doe.

Management of the Bing as a Platform initiative that Engstrom and Stockwell developed was taken away from the pair. Following their removal from the initiative they developed, their former managers released and publicly touted the immense potential of Bing as a Platform. Qi Lu, the President of the Online Services Division, was quoted in the press as saying, “Bing as a platform presents the universal platform.”

Both Engstrom and Stockwell received poor ratings in subsequent annual performances reviews, and both were essentially demoted and given lesser responsibilities. In addition, Engstrom was demoted from Level 70 to Level 69.

In 2012, Engstrom and Stockwell started another initiative within Microsoft, codenamed "Brazil", which was an attempt to compete with Amazon in the eCommerce space. According to the complaint, the project was killed by David Ku, a key lieutenant of Qi Lu's (both came to Microsoft from Yahoo!). Engstrom and Stockwell were both terminated in December 2013, along with the few remaining members of their team.

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  • (Score: 3, Funny) by sjames on Sunday March 01 2015, @11:42PM

    by sjames (2882) on Sunday March 01 2015, @11:42PM (#151671) Journal

    Is Engstrom still an OT III at least?

    At least he wasn't declared to be a subversive person.

    • (Score: 3, Funny) by Anonymous Coward on Monday March 02 2015, @06:15AM

      by Anonymous Coward on Monday March 02 2015, @06:15AM (#151727)

      You are confusing one mindless cult with a different mindless cult. One says you need to liberate yourself from Thetans implanted by Xenu (blessed be his name!). The other says you need to use DirectX or you will never go to gamer heaven. Both require, um, unnatural sex acts. So your confusion is understandable.

  • (Score: 5, Insightful) by arslan on Monday March 02 2015, @12:00AM

    by arslan (3462) on Monday March 02 2015, @12:00AM (#151678)

    Assuming this story is true, I think Engstrom and Stockwell did the right thing - not just from a moral point of view but from a CYA point of view.

    It almost seem like they were setup from the beginning when John Doe was "seconded" to them. Sounds like management wanted to reward "John Doe" for some achievement gained through less than legal means as well as approve related dodgy paperwork without getting associated directly, so they "loaned" him to another team. Engstrom and Stockwell is already caught between a rock and a hardplace to begin with once that happened. Either be complicit indirectly and take all the risk with none of the reward or risk their jobs/career by not participating.

  • (Score: 1, Funny) by Anonymous Coward on Monday March 02 2015, @12:17AM

    by Anonymous Coward on Monday March 02 2015, @12:17AM (#151679)

    Nice that it is not just PC users that got screwed by Micro$ortf, and that some people were even being paid for it.

    • (Score: 5, Insightful) by arslan on Monday March 02 2015, @01:20AM

      by arslan (3462) on Monday March 02 2015, @01:20AM (#151694)

      I don't think these kinda stuff is specific to Microsoft, it happens everywhere, from small to large corporations. If anything it reflects the country's governance of corporations. Go to a 3rd world country where corruption is rampant and you'll see these kind of stuff. Of course the U.S. is not a 3rd world country, but extreme capitalism where politics is heavily (and legally allowed to - read: lobbying and campaign donations) influenced by private sector interest causes similar problems.

  • (Score: 3, Insightful) by Nerdfest on Monday March 02 2015, @12:30AM

    by Nerdfest (80) on Monday March 02 2015, @12:30AM (#151681)

    What an absolutely weasel-infested company. Keep the bribing sales people, get rid of the thinkers ... I'd say it's not a great long term plan, but it's got them surprisingly far.

    • (Score: 0, Offtopic) by Anonymous Coward on Monday March 02 2015, @12:59AM

      by Anonymous Coward on Monday March 02 2015, @12:59AM (#151689)

      Are open source projects really any better, though? I don't use Debian, but I've sure read a lot of complaints about its leadership lately and how all the systemd stuff went down, for example. Lots of Debian users were clearly upset by it all. There were accusations of political skulduggery, and of the community's best interests not being put first and foremost. Maybe it's just that any sizable organization will suffer from such problems.

      • (Score: 0) by Anonymous Coward on Monday March 02 2015, @02:20AM

        by Anonymous Coward on Monday March 02 2015, @02:20AM (#151705)

        "Are open source projects really any better, though?"

        Yes, if you don't like something about the package(s)/project(s) YOU have the power to change it, without sucking the cock of a corporate stooge.

        "I don't use Debian, but I've sure read a lot of complaints about its leadership lately"

        Leadership in FOSS differs from leadership in convicted monopolies and their proprietary software.

        Here's a test: want to add/remove something in VLC? Do it! want to add/remove something in MSIE? Good luck.

        • (Score: 3, Touché) by Anonymous Coward on Monday March 02 2015, @02:40AM

          by Anonymous Coward on Monday March 02 2015, @02:40AM (#151707)

          Don't the major systemd contributors work for Red Hat? Sounds like dealing with them would involve, as you put it, "sucking the cock of a corporate stooge".

          • (Score: 5, Informative) by hendrikboom on Monday March 02 2015, @03:46AM

            by hendrikboom (1125) Subscriber Badge on Monday March 02 2015, @03:46AM (#151715) Homepage Journal

            Which, of course, is the reason or the Devuan fork of Debian.

            Which is how open source deals with these matters.

            -- hendrik

            • (Score: 0) by Anonymous Coward on Monday March 02 2015, @05:57AM

              by Anonymous Coward on Monday March 02 2015, @05:57AM (#151724)

              I have know some people like this in the "open source" community. In fact, they were the ones who came up with the brand "open source", since Freedom would be too scary. And the sucked up to everyone they could, demanded allegience where they could, but for the most part, without that directive from above, assholes lose. And I do not mean, assholes loose, which is a goats.exer type thing. But yes, there are not any people like that in the free software community, because if they are they are quickly exiled. Miguel, that guy (geez, even googling "linux people" no longer pulls up his name) oh, Bruce!, and of course ESR. But none of them, so far as I know, got a $22,000 hooker expense account. See, freedom. Means type A assholes get isolated.

    • (Score: 4, Insightful) by dry on Monday March 02 2015, @07:22AM

      by dry (223) on Monday March 02 2015, @07:22AM (#151738) Journal

      But salesmen are way more valuable then thinkers, just ask any salesman.
      Sadly there's some truth to it as well. A good salesman can sell shit and make money doing it. A good thinker can come up with a great product but never monetize it.

      • (Score: 4, Insightful) by aristarchus on Monday March 02 2015, @07:42AM

        by aristarchus (2645) on Monday March 02 2015, @07:42AM (#151740) Journal

        Nail on the head:

        A good salesman can sell shit and make money doing it. A good thinker can come up with a great product but never monetize it.

        You see, capitalism is a form of dementia. Marx points this out clearly in the beginning of "Das Kapital": to think that a commodity has value independently of the costs of producing it or the use value for someone else is, as Karl puts it, fetishism. So how does this work here, you may ask?
        A salesman can sell shit, but in doing so he adds nothing to society at large, he just managed to get money for something that no one would have paid for if they knew what it was. Salesmanship like this depends on ignorance. Capitalism, on the other and, is based on fair competition, one aspect of which is equal access to actual information about things like quality and fair market price. But that is not the main problem.

        The good thinker, coming up with a great product; what makes it great? Not its value to an individual, but the value to society as a whole. Now see that the value of salesman is to help the socially beneficial idea be spread, for which the salesman gets, and no doubt deserves, a small consideration. But when the salesman is selling shit, I think tar and feathers and rails have been deployed in the past before everyone was confused by the "too big to be tarred and feathered" propaganda. Of course even worse, if it does happen, is when salesmen actively suppress ideas that would benefit society in order to continue to make money off of lesser ideas. Patents. Intellectual property. NDA agreements.

        Good thinkers only need marketers in one of two situations: where communication is difficult, which describes the condition of most of humanity until rather recently, or where completing salespersons make it impossible for an honest thinker to get an idea out to the public. Monetization is only a means for publicity, so if we had the publicity (some kind of non-salesman controlled, neutral net, say), the monetization would no longer be either necessary or cost efficient.

        • (Score: 3, Interesting) by Joe Desertrat on Monday March 02 2015, @06:41PM

          by Joe Desertrat (2454) on Monday March 02 2015, @06:41PM (#152019)

          A salesman can sell shit, but in doing so he adds nothing to society at large, he just managed to get money for something that no one would have paid for if they knew what it was. Salesmanship like this depends on ignorance.

          Reminds of of this bit from the HHTTG: "It is very easy to be blinded to the essential uselessness of them by the sense of achievement you get from getting them to work at all... In other words - and this is the rock solid principle on which the whole of the Corporation's Galaxy-wide success is founded - their fundamental design flaws are completely hidden by their superficial design flaws."

      • (Score: 2) by Nerdfest on Monday March 02 2015, @02:17PM

        by Nerdfest (80) on Monday March 02 2015, @02:17PM (#151869)

        We may have different definitions of "valuable".

  • (Score: 5, Interesting) by Anonymous Coward on Monday March 02 2015, @12:43AM

    by Anonymous Coward on Monday March 02 2015, @12:43AM (#151685)

    I saw something similar happen.

    At the annual MGB, a group of employees went to at least one topless bar, which wouldn't be an acceptable business expense. The charges were paid via credit card. However, policy dictated that the most senior MS employee should pay, but the most senior person delegated that to one of his direct reports so that *he* could approve the expense report rather than his boss, and in doing so, have the company pay for the excursion.

    This wasn't anything new back then (this was a long time ago), but supposedly MS was looking to get rid of this particular manager, so they made an example of him -- or such was the rumor.

    It's entirely possible that the rumors were false and HR just did the right thing for the right reasons. I guess I'll never know. In any case, this sort of thing isn't new to MS (or to many other companies either, I'm sure), and such activity, AFAIK, isn't uncommon -- nor is it generally dealt with in that way.

    As such, it's likely that someone had an axe to grind, both in the case I saw and the one in TFA.

    • (Score: 2) by Jeremiah Cornelius on Monday March 02 2015, @01:06AM

      by Jeremiah Cornelius (2785) on Monday March 02 2015, @01:06AM (#151690) Journal

      Atlanta.

      2004

      --
      You're betting on the pantomime horse...
      • (Score: 1, Interesting) by Anonymous Coward on Monday March 02 2015, @02:17AM

        by Anonymous Coward on Monday March 02 2015, @02:17AM (#151703)

        Actually, it was South Beach, 2001. Interestingly, MS was not allowed to return to South Beach in 2002 as had been planned. That's why we went to New Orleans.

      • (Score: 1, Interesting) by Anonymous Coward on Monday March 02 2015, @02:46AM

        by Anonymous Coward on Monday March 02 2015, @02:46AM (#151709)

        Jeremiah, what was your role with Microsoft?

        • (Score: 1, Funny) by Anonymous Coward on Monday March 02 2015, @09:33AM

          by Anonymous Coward on Monday March 02 2015, @09:33AM (#151768)

          External contractor, received in excess of $22,000 for "services rendered".

    • (Score: 0) by Anonymous Coward on Monday March 02 2015, @01:53AM

      by Anonymous Coward on Monday March 02 2015, @01:53AM (#151700)

      I have seen this trick at no less than 3 different companies. From high tech to old school manufacturing. This 'trick' has been around a long time.

    • (Score: 2, Informative) by German Sausage on Monday March 02 2015, @05:19AM

      by German Sausage (1750) on Monday March 02 2015, @05:19AM (#151722)

      This is a standard business practice, that probably goes back as far as there have been expense accounts. Junior guy picks up the tab and expenses it, senior guy approves it. Hardly invented by MicroSoft.

    • (Score: 1) by dime on Monday March 02 2015, @06:41AM

      by dime (1163) on Monday March 02 2015, @06:41AM (#151732)

      I don't see how you were surprised at ALL by any of that. I mean, I figured you were "in the know" consider you even got an invite to the "MGB".

      Wait, does "MGB" not mean what I think it does?

      • (Score: 3, Informative) by Anonymous Coward on Monday March 02 2015, @06:58AM

        by Anonymous Coward on Monday March 02 2015, @06:58AM (#151734)

        MGB 2001 [sun-sentinel.com]

        MGB 2004 [msdn.com]

        MGB: Microsoft Global Briefing

        MGB is for Microsoft field (sales, marketing, consulting, etc.) personnel and a few select partners. Thousands of people. If you haven't worked for Microsoft, why would you know?

        If you do, or have, worked for Microsoft, you know exactly what it is: five (and for some, ten) days of presentations about Microsoft products, technologies and research during the day, and drunken debauchery at night.

        • (Score: 0) by Anonymous Coward on Monday March 02 2015, @08:00AM

          by Anonymous Coward on Monday March 02 2015, @08:00AM (#151743)

          Mod: Informative! And here I was thinking the MGB was either a small British sports car, or stood for Micro$oft Gang ****. Thank you for clearing that up. (Even though I still think the later might still be the correct version.)

          • (Score: 0) by Anonymous Coward on Monday March 02 2015, @03:41PM

            by Anonymous Coward on Monday March 02 2015, @03:41PM (#151909)

            Technically speaking, it's not far off from a Microsoft Gang Bang.

            • (Score: 0) by Anonymous Coward on Monday March 02 2015, @04:37PM

              by Anonymous Coward on Monday March 02 2015, @04:37PM (#151938)

              Sounds more like a circle jerk than a gangbang.

      • (Score: 0) by Anonymous Coward on Monday March 02 2015, @07:49AM

        by Anonymous Coward on Monday March 02 2015, @07:49AM (#151741)

        I don't see how you were surprised at ALL by any of that.

        Original AC here. Where exactly did I say I was surprised? Or that I thought this was something new?

        In fact, I said just the opposite.

        Have you had a few beers or something? Or maybe your reading comprehension is failing after all those nights at the "Hostess" bars that you expensed?

        • (Score: 1) by dime on Monday March 02 2015, @03:31PM

          by dime (1163) on Monday March 02 2015, @03:31PM (#151905)

          Was joking that MGB was the "Microsoft Gang Bang".

        • (Score: 0) by Anonymous Coward on Monday March 02 2015, @05:36PM

          by Anonymous Coward on Monday March 02 2015, @05:36PM (#151979)

          Yes, had a few MGD's. Don't need MGB for that. or BVDs.