In a landmark ruling of first impression, the Pennsylvania Supreme Court recently held that an employer’s non-competition covenant, which included the employee’s pledge not to challenge the covenant for inadequate consideration, is unenforceable unless it is accompanied by a change in job status or some other significant benefit. Socko v. Mid-Atlantic Systems of CPA, Inc., Case No. 3-40-2015 (Nov. 18, … Continue Reading
As has been well-chronicled in this blog, Massachusetts and many other states (and even the federal government) have been grappling with proposed legislation that would ban or severely limit non-competes in employment contracts. Proponents of bans on non-competes claim that they stifle innovation in the technology sector by preventing skilled employees from using their unique talents to start … Continue Reading
In recent weeks, courts almost routinely have been denying preliminary injunctive relief in cases alleging violation of non-compete and similar employment agreements. Three examples: Burleigh v. Center Point Contractors, 2015 Ark. App. 615 (Oct. 28, 2015); Evans v. Generic Solution Engineering, LLC, Case No. 5D15-578 (Fla. App., Oct. 30, 2015); and Great Lakes Home Health Services Inc. v. … Continue Reading
On Thursday, November 19, 2015 at 12:00 p.m. Central, Seyfarth attorneys John Skelton, Erik Weibust and Anne Dunne will present the ninth and final installment of its 2015 Trade Secrets Webinar series, Seyfarth attorneys will focus on how to implement and enforce covenants against competition in the franchise context. A franchisor’s trade secrets, confidential information, and goodwill are often … Continue Reading
On Thursday, September 24 at 12:00 p.m. Central, Seyfarth attorneys Eric Barton, Justin K. Beyer and Robert C. Stevens will present the seventh installment in its series of 2015 Trade Secret Webinars. Presenters will focus on the issues confronting plaintiffs in preparing for and prosecuting trade secret cases and the various ins and outs of seeking both temporary restraining orders … Continue Reading
In Seyfarth’s sixth installment, attorneys Michael Baniak and Paul Freehling discussed the significant statutory changes to several jurisdictions’ laws regarding trade secrets and restrictive covenants and pending legislation proposed in additional jurisdictions over … Continue Reading
Spock: “I am a [lawyer], sir. We embrace technicalities.”
Arbitration is no longer the final frontier. Instead, arbitration is often the first and only forum for resolving disputes. The business community has embraced arbitration as an alternative method of dispute resolution, but sophisticated parties still maintain a preference favoring court resolution … Continue Reading
A preliminary injunction was entered against a fired executive of a roofer who, immediately after he was discharged, went to work for an alleged competitor. The district court held, and the Seventh Circuit agreed, that his non-compete and non-solicit agreements were overbroad and confusing, but that some injunctive relief nonetheless was warranted in this case. Turnell v. CentiMark Corp., … Continue Reading
Join Seyfarth Trade Secrets and Non-Compete Co-Chair Robert B. Milligan at the 2015 ABA-IPL Annual Meeting in Chicago on July 30, 2015. Robert will join expert panelists to discuss significant statutory changes to several jurisdictions’ laws regarding restrictive covenants and pending legislation proposed in additional jurisdictions over the past year, as well as the ongoing effort to federalize trade secret … Continue Reading
Where a freely negotiated contract between two sophisticated companies included a provision barring an award of monetary relief for breach of contract, the court will enforce the provision as written and award no economic damages. CH2O, Inc. v. Meras Engineering, Inc., No. 45728-8-II (Wash. App. Court, July 21, 2015) (unpublished opinion).
Status of the Case
A non-exclusive distributorship agreement … Continue Reading
On Tuesday, August 18, 2015 at 12:00 p.m. Central, Kate Perrelli, Eddy Salcedo and Dawn Mertineit will present the sixth installment in our 2015 Trade Secrets Webinar Series. They will discuss the significant statutory changes to several jurisdictions’ laws regarding trade secrets and restrictive covenants and pending legislation proposed in additional jurisdictions over the past year. As trade secrets and … Continue Reading
At a time when an ex-employee’s newly created company was subject to an injunction prohibiting misappropriation of his former employer’s supposed trade secret, the new company allegedly used that confidential information on a few occasions in the course of providing services. The former employer sued. Although the trial court found no violation of the injunction, that ruling was reversed on … Continue Reading
Seyfarth Offers 2015-2016 Edition of 50 State Desktop Reference: What Employers Need To Know About Non-Compete and Trade Secrets Law
There is no denying that there exists a variety of statutes and case law across the country when it comes to non-competition and non-solicitation agreements, as well as the protection of proprietary information. All too often, what is enforceable in … Continue Reading
On June 11, 2015, Alabama’s Governor signed into law legislation that revises the state’s non-compete statute, which is found in Section 8-1-1 of the Code of Alabama. The effective date for these changes is January 1, 2016. As summarized below, these revisions represent the Alabama legislature’s attempt to “clarity” portions of the non-compete statute by codifying several recent judicial decisions … Continue Reading
As directed by the court of appeals, a district court judge reconsidered his denial of a non-compete covenant case injunction but reached the same result on reconsideration. He also stated why he would not have extended the covenant’s expiration date even if he had been inclined to enter the injunction. Ocean Beauty Seafoods LLC v. Pacific Seafood Group Acquisition Co., … Continue Reading
On June 26, 2015, Hawaii’s governor David Ige signed Act 158 which voids any “noncompete clause or a nonsolicit clause in any employment contract relating to an employee of a technology business.”
The Act defines “technology business” as one that “derives the majority of its gross … Continue Reading
Three very recent decisions reflect the irreconcilable division of judicial authority regarding the adequacy of at-will employment as the sole consideration for an otherwise valid non-compete. Compare (a) Standard Register Co. v. Keala, No. 14-00291 (D. Haw., June 8, 2015) (adequate under Hawaii law) (“majority rule”), with (b) Hunn v. Dan Wilson Homes, Inc., Nos. 13-11297 and 14-10365 … Continue Reading
Following up on my post weighing on the MOVE Act, which stands to impact non-compete agreements for low-wage employees if enacted, I had the opportunity to discuss the subject with Colin O’Keefe of LXBN. In the interview, I discuss the basics of the potential legislation and whether or not it has a chance of passing.
A trial court declined to enter a preliminary injunction in a non-compete covenant case despite a provision in the covenant giving the employer the “right to seek injunctive relief in addition to any other remedy available to it.” The decision was affirmed on appeal.
Summary of the case. A 20% owner of a pest control service company (referred to by … Continue Reading
California courts generally favor forum selection clauses entered into freely by parties and where enforcement is not unreasonable. This general principle is true even if the forum selection clause is “mandatory” and requires a party to litigate its dispute exclusively in the designated forum. The party opposing enforcement of a forum selection … Continue Reading
U.S. Senators Al Franken (D-Minn.) and Chris Murphy (D-Conn.) proposed federal legislation last week to ban the use of non-competes for low-wage employees and require companies to provide advance notice before asking potential employees to sign non-competes. Senators Elizabeth Warren (D-Mass.) and Richard Blumenthal (D-Conn.) are cosponsors of the bill.
Last summer was a busy time for legislators in Massachusetts mulling over non-compete reform. As we reported here and here, several competing bills were in play as the legislative session drew to a close, including a compromise bill that was passed in the state Senate but ultimately failed to advance in the House. You may even recall that then-Governor … Continue Reading
Nationally, our Trade Secrets practice retained its position in Tier 2. For the second year in a row, our practice has been named to the shortlist for best trade secrets practice in the U.S., and we are … Continue Reading
A non-competition covenant prohibited employees of Adhesives Research (AR), a company based in Pennsylvania, from performing services for a competitor of AR anywhere in the world for two years after termination. Newsom, AR’s western U.S. manager of medical products, worked out of her home in California. When she quit and joined another adhesives manufacturer, AR sued and moved for entry … Continue Reading