The transition from departing iPod chief Tony Fadell to new vice president of Devices Hardware Engineering Mark Papermaster is not going to an easy one for Apple. A U.S. District Court judge ruled yesterday that Papermaster would have to cease work immediately for Apple while allegations of a breach of contract with his former employer, IBM, is looked into, reports Reuters.

Apple formerly announced Papermaster’s role on Tuesday after word leaked out of his departure from IBM the previous week. At the time, it was thought that Papermaster would use his experience with microprocessors at IBM to help Apple build some of its own for devices such as the iPhone. But with Fadell’s departure (he’ll be staying on as an advisor to Apple chief executive Steve Jobs), Papermaster got the larger task of overseeing all the work on the iPhone and iPod divisions.

IBM is not happy about that. It claims Papermaster’s contract stipulates that if he left IBM he could not work for a competitor for a year. Lawyers are now arguing over if Apple is really an IBM competitor and if it’s fair to make someone sit out of work in their industry for a year.

“We will comply with the court’s order but are confident that Mark Papermaster will be able to ultimately join Apple when the dust settles,” an Apple spokesman told Reuters.

Digital Daily has a nice rundown of the past rivalry (in the 1980s) of Apple and IBM.