I’d agree with you if this was just a random person, but from this thread (I haven’t read the article) I gather that s/he was actually an intern... surely every intern/employee would sign some kind of non-compete / trade secret / intellectual property agreement? In that case, the CEO is completely justified in pursuing to enforce that agreement!

Again, it would be different if the CEO threatened a random third party that happened to do a weekend project in the same vertical...