Well because if he was taken to court that costs time and money, even if ultimately the lawsuit fails, no?

A bit late to the party, but even when threatening with insolvency-via-lawsuit, this would probably not work for them:

- if he can prove the threat, the company will be in an even worse position

- given the rather lacking precedent (as pointed out by the sister comment), there's a good chance the suit would be thrown out pre-court and therefore be rather cheap

- given that the OP seems to be a valued engineer, it is reasonable to assume that he has the f-you-money to fight this out

- even if won, the drawn out battle would take far too long to fix the software in time and, given that they then lost a 10 million contract, they lack the motivation (and maybe money) to continue

- lastly, even if they won after loosing the contract, they'd probably not be able to extract much in damage payments

So it's a rather empty threat.

Maybe this is my naivety showing, but to my knowledge it's not a common occurrence for companies to sue employees for refusing to work for them, especially if (as the OP notes elsewhere in the thread) there's no actual contractual obligation.

> for companies to sue employees for refusing to work for them

Especially ex-employees who've been gone 6 months already.

Shouldn't be hard to find a no win no fee ambulance chaser to happily take them on and get costs awarded and damages as well...