Microsoft is suing Google and Lee for allegedly breaching a non-compete employment contract with Microsoft that Lee signed in 2000, according to Microsoft. The world’s largest software maker is seeking a temporary restraining order that would prevent Lee from being a Google employee.

A hearing on the case will be held today in a Washington court. A battle over legal jurisdiction is widely expected.

Two days after Microsoft’s lawsuit, Google countersued in a California court and sought to invalidate the non-compete provision.

Unlike in Microsoft’s home state of Washington, Californian courts tend not to enforce the type of contract clause at the heart of Microsoft’s case. Of course, California also is where Google is headquartered.

In court filings, Google and Lee said Lee was a Californian resident. Microsoft begged to differ.

Last week, Google announced that Kai-Fu Lee was hired to lead their new R&D Center in China and, in fact, he directly said he is looking forward to returning to China, Microsoft said in a written statement yesterday.

Forced to confront its clear violation of Washington law, Google is attempting to manufacture California residency for Dr Lee in a poorly disguised effort to persuade a California court to treat him as a California resident in order to evade Washington law and renege on the agreement Dr Lee made to Microsoft.

In court filings, Microsoft said Kai-Fu Lee, reportedly earned more than $1m for working for Microsoft Corp last year.

Since working for Microsoft in August 2000, Lee earned well over $3m, the filings reportedly read.