On May 14, 2019, Oregon Governor Kate Brown signed into law HB 2992, which, as of January 1, 2020, requires an employer to provide a terminated employee with a signed, written copy of his or her non-competition agreement within 30 days of his or her termination date.  Failure to do so will render the agreement voidable and unenforceable in the state of Oregon.

Backdrop for HB 2992

Under current Oregon law (ORS 653.295), a non-competition agreement is not enforceable unless the following four requirements are met: (1) the employer informs the employee of the non-competition agreement in a written employment offer received at least two weeks before the employee’s first day, or the agreement is entered into upon promotion; (2) the employee is engaged in administrative, executive, or professional level work; (3) the employer has a protectable interest in requiring the non-competition agreement; and (4) the employee’s gross annual salary and commissions at the time of termination exceeds the median family income for a four-person family.  Furthermore, the term of a non-competition agreement may not exceed 18 months from the date of the employee’s termination.  Any time remaining on a non-competition agreement beyond 18 months is voidable and precluded from enforcement by any Oregon court. Continue Reading Oregon Adds Employee-Friendly Requirement to Existing Non-Compete Law… But Also Produces Company-Friendly Trade Secrets Law in Recent Court of Appeals Case

In just a few short months, on January 1, 2020, the California Consumer Privacy Act (CCPA) is set to go into effect, establishing new consumer privacy rights for California residents and imposing significant new duties and obligations on commercial businesses conducting business in the state of California. Consumer rights include the right to know what personal information a business is collecting, selling, and disclosing about them; the right to deletion; the right to opt-out of the sale of personal information; and the right not to be discriminated against (written as a business duty). These rights are intended to provide consumers with a level of control of their personal information and to establish transparency on the part of the businesses to comply with consumers’ exercise of their privacy rights. In addition, businesses are required to provide employee training; website notice of consumer rights and categories of personal information collected, sold, and disclosed; and to implement and maintain adequate security measures. The penalties of non-compliance can be severe, with avenues for both regulatory enforcement and private cause of action. Learn what the attorney general’s forthcoming regulations likely have in store for businesses and what your organization should be doing now to proactively prepare for the CCPA to ensure compliance.

Jason Priebe, John Tomaszewski, and Edward “Ted” Murphree, three of our experienced eDiscovery and Information Governance (eDIG) and Global Privacy and Security (GPS) practitioners, will present a series of three 1-hour CLE webinars. The presenters will provide high-level discussion on strategies for CCPA compliance.

CCPA Webinar Series Part 1: An Overview and What You Need to Know (Until It Changes)

Tuesday, July 9, 2019
1:00 p.m. to 2:00 p.m. Eastern
12:00 p.m. to 1:00 p.m. Central
11:00 a.m. to 12:00 p.m. Mountain
10:00 a.m. to 11:00 a.m. Pacific

CCPA Webinar Series Part 2: Business Obligations and Responsibilities (So Far As We Know Them–They Will Change)

Wednesday, July 17, 2019
1:00 p.m. to 2:00 p.m. Eastern
12:00 p.m. to 1:00 p.m. Central
11:00 a.m. to 12:00 p.m. Mountain
10:00 a.m. to 11:00 a.m. Pacific

CCPA Webinar Series Part 3: Enforcement and Compliance (Or What We Think Will Happen)

Thursday, August 1, 2019
1:00 p.m. to 2:00 p.m. Eastern
12:00 p.m. to 1:00 p.m. Central
11:00 a.m. to 12:00 p.m. Mountain
10:00 a.m. to 11:00 a.m. Pacific

While it is well-settled law that an attorney cannot be bound by an agreement restricting the right to practice law, that does not insulate attorneys from all restrictive covenants. As we have previously discussed, there are exceptions to this rule, as a Massachusetts attorney recently learned the hard way.  Continue Reading “A Very Tortured Argument”—Lawyer Cannot Use Bar Membership to Skirt a Bargained-For Restrictive Covenant in the Sale of a Non-Legal Business

Even before the California Supreme Court decided Edwards in 2008, employers knew all too well the woes of attempting to enforce non-competes against California employees.  Edwards simply reaffirmed California’s long-standing policy in favor of employee mobility, finding that employee non-competition agreements are typically void in California unless they fall within one of the exceptions to Business and Professions Code section 16600.  But this need not become the fate of every non-compete; notwithstanding Edwards and recent California decisions applying the state’s notorious statute, section 16600, it may be possible for employers to enforce non-competition forfeiture provisions by including them in deferred compensation top hat plans subject to the Employee Retirement Income Security Act of 1974 (ERISA). Continue Reading Not All Is Lost for California Employers: Enforce Non-Compete Forfeiture Provisions through ERISA Top Hat Plans?

As we’ve previously written about on this blog, last summer the Massachusetts legislature passed a non-compete reform bill which went into effect on October 1, 2018. Readers of this blog will recall our concerns that the new law is in many ways confusing and may lead to unpredictable results. Now, more than six months after its effective date, we have a second published decision out of the United States District Court for the District of Massachusetts citing the new Massachusetts Noncompetition Agreement Act (“MNCA”), Mass. Gen. Laws ch. 149, § 24L. Like the first published decision, this decision does not directly analyze an agreement that is subject to the Act, but it is still instructive for employers with personnel who may be subject to the MNCA.  Continue Reading Federal Judge Confirms That Massachusetts’ New Non-Compete Law Does Not Require Garden Leave or Massachusetts Choice of Law

The 2019 edition of The Legal 500 United States recommends Seyfarth Shaw’s Trade Secrets group as one of the best in the country. Nationally, for the fourth consecutive year, our Trade Secrets practice earned Top Tier.

Based on feedback from corporate counsel, Seyfarth partner Michael Wexler was ranked in the editorial’s “Leading Lawyers,” and Robert Milligan, Daniel Hart, Erik Weibust, and J. Scott Humphrey were also recommended in the editorial.

The Legal 500 United States is an independent guide providing comprehensive coverage on legal services and is widely referenced for its definitive judgment of law firm capabilities. The Legal 500 United States recognizes and rewards the best in-house and private practice teams and individuals over the past 12 months. The awards are given to the elite legal practitioners, based on comprehensive research into the U.S. legal market.

Washington state has joined the ranks of an ever-growing number of states that impose significant restrictions on employee non-compete agreements. On May 9, 2019, Governor Jay Inslee signed House Bill 1450, titled “An Act Relating to restraints, including noncompetition covenants, on persons engaging in lawful professions, trades, or businesses,” into law. The Act will go into effect on January 1, 2020. We reported on the bill in detail in March.

This change to Washington law is significant. Businesses with employees or independent contractors in the state should revisit their non-compete agreements and take the necessary steps to ensure compliance with the Act by the end of this year. Among other things: Continue Reading Washington State Governor Signs Law Severely Limiting Non-Competes

In Seyfarth’s third installment in its 2019 Trade Secrets Webinar Series, Seyfarth attorneys Katherine Perrelli, Justin K. Beyer, and Amy Abeloff focused on the key provisions of the Defend Trade Secrets Act, how the DTSA has evolved since it was passed three years ago, and what to expect in the future.

As a conclusion to this well-received webinar, we compiled a summary of takeaways:

  • The Defend Trade Secrets Act of 2016 created a federal civil cause of action for owners of trade secrets that have been misappropriated. While the DTSA is very similar to the UTSA, there are a few key differences to be aware of—such as the DTSA’s ex parte seizure option, which may be brought by a plaintiff without notice to an adversary, and the DTSA’s whistleblower immunity.
  • If an employer does not include the statutory whistleblower notice language in its employment (and consultant) agreements and employment policies that include provisions protecting against the disclosure of trade secret and confidential information, the employer may not be awarded exemplary damages or attorney’s fees in a misappropriation action against an employee (or consultant) to whom the notice was not provided.
  • As courts continue to consider DTSA cases, it is important to track how courts around the country interpret the DTSA against its state law counterparts to better understand the interplay between the two. While there are a number of overlapping provisions between the DTSA and the UTSA, understanding the differences can help practitioners better predict outcomes when evaluating whether to bring state-law, DTSA, or DTSA and UTSA claims.

Cross-Posted from The Global Privacy Watch Blog

In Part 1 of our ‘Texas Joins the Privacy Fray’ series, we focused on the Texas Consumer Privacy Act. Here, we shine the light on the Texas Privacy Protection Act (HB 4390).

The TXPPA is distinguishable from both the TXCPA and the CCPA because the applicability threasholds are different. For the TXPPA to apply, a business must 1) be doing business in Texas; 2) have more than 50 employees; 3) collect personally identifiable information (“PII”) of more than 5,000 individuals, households, or devices (or has it collected on the business’s behalf); and 4) meet one of the following two criteria—the business’ annual gross revenue exceeds $25 million; or the business derives 50% or more of its annual revenue from processing PII. Continue Reading And Texas Joins the Privacy Fray – Part 2 (or, Everything is Bigger in Texas…)

Cross-Posted from The Global Privacy Watch Blog

Last month, Texas saw the introduction of not one, but TWO privacy bills in the Texas state legislature: The Texas Consumer Privacy Act (TXCPA) and the Texas Privacy Protection Act (TXPPA). With news of this likely meeting with a collective groan and shoulder shrug, we do have some good news for you.

Both bills’ foundations are set with familiar CA Consumer Privacy Act (“CCPA”) language. Unfortunately, this is also bad news because they both suffer from the same problems found in the CCPA – we’ll explain below. It’s also still early in the game, with the bills having just been filed in the state legislature. Given that there is time in the legislative session for amendments to be made and especially considering the ‘ring-side’ view Texas lawmakers have to the CA legislative and Attorney General rule/procedure process currently unfolding, it would be unreasonable not to expect changes. Finally, the bills are reactive responses to the national (or international) focus on privacy issues of late and may allow impacted businesses a grace period, as we’ve seen in the CCPA. In this blog, we shine the light on the first of these bills: The Texas Consumer Privacy Act. Continue Reading And Texas Joins the Privacy Fray – Part 1 (or, the Elephant in the room just got a LOT bigger…)