On May 30, 2013, a federal judge in Virginia dismissed a tax consultant’s trade secrets misappropriation claim against its telecomm customers, ruling that the consultant’s alleged relationships with tax authorities, tax-law ‘accounting system,’ and its ability to negotiate property tax discounts do not constitute statutory trade secrets. Cablecom Tax Services, Inc. v. Shenandoah Telecomms. Co…. Continue Reading
Category Archives: Restrictive Covenants
Subscribe to Restrictive Covenants RSS FeedPleading Former Employer’s Breach Of Employment Contract: Affirmative Defense Or Counterclaim To Suit For Violating Non-Compete And Non-Solicitation Covenants?
Posted in Non-Compete Enforceability, Restrictive CovenantsAffirmative defenses and compulsory counterclaims. In many instances, the consideration for an ex-employee’s non-compete and non-solicitation covenants was new or continued employment. If the former employer then breaches the employment contract — for example, by failing to pay all of the compensation and benefits to which the ex-employee was entitled — but nevertheless sues the… Continue Reading
Upcoming Complimentary Webinar: Trade Secret and Non-Compete Legislative Update
Posted in Legislation, Non-Compete Enforceability, Practice & Procedure, Restrictive Covenants, Trade SecretsIn Seyfarth’s sixth installment in its series of 2013 Trade Secret Webinars, on Tuesday, June 25, 2013 at 12:00 p.m. Central Time, Seyfarth attorneys Bob Stevens, Erik Weibust and Dan Hart 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… Continue Reading
New Oklahoma Law Clarifies Enforceability of Non-Solicitation of Employee Covenants
Posted in Non-Compete Enforceability, Practice & Procedure, Restrictive CovenantsOklahoma recently passed a new law (Senate Bill 1031) that clarifies the enforceability of non-solicitation of employee covenants within the state. The new law attempts to resolve uncertainties that may have arisen about such restrictive covenants after the Oklahoma Supreme Court’s 2011 decision in Howard v. Nitro-Life Technologies, LLC. In Howard, the Oklahoma Supreme Court… Continue Reading
Protecting Confidential Information and Client Relationships in the Financial Services Industry Webinar
Posted in Practice & Procedure, Restrictive Covenants, Trade SecretsPlease join us for a complimentary webinar entitled Protecting Confidential Information and Client Relationships in the Financial Services Industry on May 23rd at 12:00 p.m. – 1:00 p.m. c.s.t. The fourth webinar of the 2012 series will focus on trade secret and client relationship considerations in the banking and finance industry, with a particular focus on a… Continue Reading
Illinois Federal Court Issues Preliminary Injunction Prohibiting Use Of Misappropriated Trade Secrets But Rejects Request For Expanded Injunction Based On Alleged “Inevitable Disclosure”
Posted in Non-Compete Enforceability, Practice & Procedure, Restrictive Covenants, Trade SecretsA recent Illinois trade secrets and non-compete decision involving a 3D printing salesman serves as a reminder that some Illinois courts will scrutinze overly broad non-compete provisions and may limit injunctive relief to the territory that the employee actually serviced for their former employer. Fisher/Unitech, Inc. v. Computer Aided Technology, Inc., Case No. 13 C 2090 (N.D.Ill., 4/9/13)…. Continue Reading
Upcoming Webinar: Protecting Confidential Information and Client Relationships in the Financial Services Industry
Posted in Practice & Procedure, Restrictive Covenants, Trade SecretsIn Seyfarth’s fifth installment in its series of 2013 Trade Secret Webinars, on Thursday May 23, 2013 at 12:00 p.m. Central Time, Seyfarth attorneys Scott Humphrey, Daniel Lanciloti, and Jason Stiehl will focus on trade secret and client relationship considerations in the banking and finance industry, with a particular focus on a firm’s relationship with… Continue Reading
New Jersey Legislators Propose Banning Non-Compete Agreements With Employees Who Can Claim Unemployment
Posted in Legislation, Non-Compete Enforceability, Restrictive CovenantsBy Jessica Mendelson and Robert Milligan New Jersey state legislators recently proposed A3970, a bill designed to prevent New Jersey businesses from enforcing “non-compete agreements with staffers who can claim unemployment compensation.” The bill, which is sponsored by Assembly members Joseph Egan and Peter Barnes, was recently referred to the state’s Assembly Labor Committee. If the bill… Continue Reading
Illinois Legislator Proposes Unique Employment Noncompete Agreement Act
Posted in Legislation, Non-Compete Enforceability, Restrictive CovenantsRep. Thomas Morrison, a Republican member of the Democratic-controlled Illinois General Assembly, has introduced HB 2782 (98th G.A.) – the “Employment Noncompete Agreement Act.” The bill would create a new Illinois statute, not simply an amendment to an existing one, that differs markedly from every current state non-compete statute. Rep. Morrison introduced the identical bill… Continue Reading
Federal Court Requires Foreign Resident To Litigate Non-Compete Dispute in Missouri Based Upon Forum Selection Clause
Posted in Non-Compete Enforceability, Practice & Procedure, Restrictive CovenantsBy Robert Milligan and Grace Chuchla It’s 8,242.7 miles or a 17 hour flight between the Philippines and Missouri. Nobody would dispute that this is a significant distance, but as far the Eastern District of Missouri is concerned, forcing a defendant who lives in the Philippines to participate in litigation occurring in Missouri does not… Continue Reading
California Federal Court Allows Non-Signatory to Arbitration Agreement to Compel Arbitration in Trade Secrets Dispute
Posted in Computer Fraud and Abuse Act, Restrictive Covenants, Trade SecretsA federal district court in the Northern District of California recently found that a non-signatory to an arbitration agreement may enforce that agreement against a signatory and compel arbitration under the doctrine of equitable estoppel. Semin, a software developer, worked for Torbit, Inc. He signed an employment agreement containing a proprietary information non-disclosure provision, and a commitment… Continue Reading
Federal Court Rules That Twitter Invites and Facebook Posts Do Not Constitute Impermissible Employee Solicitations
Posted in Non-Compete Enforceability, Practice & Procedure, Restrictive Covenants, Social Media, Trade SecretsOn January 22, 2013, United States Magistrate Judge Steven Shreder of the Eastern District of Oklahoma issued a report and recommendation, following Plaintiff Pre-Paid Legal Services, Inc.’s motion for preliminary injunction against its former employee Todd Cahill, concerning whether certain social media communications constituted impermissible employee solicitations in violation of a restrictive covenant agreement. Pre-Paid… Continue Reading
California Federal Court Dismisses California Employee’s Challenge Of His Non-Compete Agreement Based Upon Enforceable Forum Selection Provision
Posted in Non-Compete Enforceability, Practice & Procedure, Restrictive Covenants, Unfair CompetitionBy Robert Milligan and Grace Chuchla California federal courts have again said it loud and clear — when analyzing whether or not the enforcement of a forum selection clause within a non-competition agreement is contrary to California public policy, the court will not consider the substantive effects of enforcing the clause. In a recent case out of… Continue Reading
Fashion Company Launches Breach of Confidentiality/Unfair Competition Suit Against Former Employee
Posted in Restrictive Covenants, Trade Secrets, Unfair CompetitionNow that the Tory Burch lawsuit has settled, it looks like we’ve got ourselves another preppy clothing dispute on our hands! Last week, J. Crew sued one of its former employees, a senior design director named Dwight Fenton, for allegedly stealing confidential information in New York state court. Fenton had recently resigned from the company… Continue Reading
Missouri Federal Court Finds Violations of Employment Agreement May Constitute Unlawful Access Under the Computer Fraud and Abuse Act
Posted in Computer Fraud and Abuse Act, Restrictive Covenants, Trade SecretsBy Paul Freehling and Joshua Salinas A recent Missouri federal court opinion describes an almost unbelievable scenario. Employees signed well-drafted employment agreements — containing such provisions as non-competition, confidentiality, promise of loyalty, and commitment to return employer’s property within 24 hours of termination of employment — and then incorporated and operated a competitor company while still… Continue Reading
Federal Trade Commission Removes Bleach Companies’ Non-Compete Agreement
Posted in Non-Compete Enforceability, Restrictive CovenantsThe Federal Trade Commission (“FTC”) recently put an end to a non-compete agreement between two bleach companies that allegedly drastically reduced competition in the American South. Oltrin Solutions, LLC and JCI Jones Chemicals Inc., were competitors in the market for bulk bleach, which is used primarily as a disinfectant in municipal water treatment. Oltrin is… Continue Reading
California Appellate Decision Clarifies Standard for Injunctive Relief Carve-Outs Within California Arbitration Agreements
Posted in Practice & Procedure, Restrictive Covenants, Trade SecretsBy Robert Milligan and Grace Chuchla Arbitration agreements with carve-outs for provisional remedies are again the topic du jour, particularly in California courts which apply a stringent unconscionability analysis to employee arbitration agreements. As we previously discussed on this blog, in October 2012, a federal district court for the Eastern District of California upheld an… Continue Reading
To Work or Not to Work – Maryland’s Senate Considers Changes To Non-Compete Law for Those on Unemployment
Posted in Legislation, Non-Compete Enforceability, Practice & Procedure, Restrictive CovenantsOn January 9th, the Maryland Senate introduced a bill which if passed would invalidate employee “noncompetition covenants” for former workers who applied for and obtained unemployment benefits. Senate Bill 51 is sponsored by Senator Ronald N. Young, Democrat, who just began his third year in the Maryland Senate. If enacted, the bill will take effect… Continue Reading
2012 National Year in Review: What You Need to Know About the Recent Cases/Developments in Trade Secrets, Non-Compete, and Computer Fraud Law
Posted in Computer Fraud, Computer Fraud and Abuse Act, Data Theft, Espionage, Legislation, Non-Compete Enforceability, Practice & Procedure, Restrictive Covenants, Trade Secrets, Unfair CompetitionIn Seyfarth’s first installment of its 2013 Trade Secrets Webinar series, Seyfarth attorneys Michael Wexler, Robert Milligan, and Joshua Salinas will review noteworthy cases and other legal developments from across the nation this past year in the areas of trade secrets and data theft, non-compete enforceability, computer fraud, and company owned social media accounts and… Continue Reading
2012 Year in Review On Significant Trade Secret, Non-Compete, and Computer Fraud Cases, Legislation, and Developments Now Available
Posted in Breach of Fiduciary Duty, Computer Fraud, Computer Fraud and Abuse Act, Data Theft, Espionage, Legislation, Non-Compete Enforceability, Practice & Procedure, Restrictive Covenants, Trade Secrets, Unfair CompetitionWe are pleased to announce the publication of the Trading Secrets Blog 2012 Year in Review. The 2012 Review is a compilation of our significant blog posts from 2012 and is categorized by specific topics: Trade Secrets; Computer Fraud and Abuse Act; Non-Competes and Restrictive Covenants; and Legislation. As the specific blog entries, including our Top 10… Continue Reading
Chicago Breakfast Briefing: Protecting Your Most Valuable Assets – Trade Secrets, IP and Your Employees
Posted in Data Theft, Non-Compete Enforceability, Practice & Procedure, Restrictive Covenants, Trade Secrets, Unfair CompetitionIllinois and Federal laws have evolved significantly in recent years and as a result employers now have many tools available to protect themselves. Understanding these tools, as well as the impact of legal changes in this area, is necessary if a company intends on protecting its most valuable assets (i.e. trade secrets, IP and employees)…. Continue Reading
Rankings Of NFL Prospects May Constitute Trade Secrets
Posted in Practice & Procedure, Restrictive Covenants, Trade SecretsWith today’s college football National Championship game between Alabama and Notre Dame, a recent trade secret decision regarding the interplay between trade secrets and NFL scouting grades caught our eye. National Football Scouting authors several hundred six-page biographical reports annually on outstanding college football players. The reports are sold for $75,000 each to 21 NFL teams… Continue Reading
Top 10 Developments/Headlines in Trade Secret, Computer Fraud, and Non-Compete Law in 2012
Posted in Computer Fraud and Abuse Act, Data Theft, Espionage, Non-Compete Enforceability, Practice & Procedure, Restrictive Covenants, Trade Secrets, Unfair CompetitionBy Robert Milligan and Joshua Salinas As part of our annual tradition, here is our list of the top 10 developments/headlines in trade secret, computer fraud, and non-compete law for 2012. Last year we predicted that in 2012 we would see a significant increase in social media cases and this year did not disappoint. In fact,… Continue Reading
2012 Trade Secrets, Computer Fraud, and Non-Competes Webinar Series – Year in Review
Posted in Breach of Fiduciary Duty, Computer Fraud, Computer Fraud and Abuse Act, Data Theft, Espionage, Legislation, Non-Compete Enforceability, Practice & Procedure, Restrictive Covenants, Trade Secrets, Unfair CompetitionThroughout 2012, Seyfarth Shaw LLP’s dedicated Trade Secrets, Computer Fraud & Non-Competes Practice Group hosted a series of CLE webinars that addressed significant issues facing clients today in this important and ever changing area of law. The series consisted of eight webinars: 1) Employee Privacy, Social Networking at Work, and the Computer Fraud and Abuse… Continue Reading