A recent Louisiana non-compete case involving two appellate decisions addresses three significant issues in non-compete litigation: 1) whether a former employee’s referral of customers to a new employer violated the employee’s non-solicitation of customer covenant; 2) the consequences of violating the covenant and court injunction; and 3) the appropriate standard of proof for contempt proceedings.

Summary of decision. Five years
Continue Reading Referring Former Employer’s Customers To New Employer Held Violation Of Injunction, Resulting In Finding Of Criminal Contempt

Garrod, a salesman for more than 25 years in the field of elastomeric precision products (EPP), was terminated in mid-2012 after spending an aggregate of a dozen of those years working for manufacturers of EPP parts Fenner and a company acquired by Fenner.

He had signed both employers’ agreements containing non-compete and customer non-solicitation clauses–which appeared reasonable on their face–and
Continue Reading New York Federal Court Denies Injunction to Enforce Restrictive Covenants Against Terminated Employee

MPI, a Texas company, went to Kentucky and allegedly attempted to hire two Luvata employees, Foster and Meredith. Foster joined MPI soon thereafter. Over the course of the next few months while Meredith remained a Luvata employee, he and Foster allegedly spoke by phone repeatedly. In addition, prior to leaving Luvata for MPI, Meredith allegedly copied his employer’s computer
Continue Reading Despite Allegations That Something Fishy Was Occurring, Kentucky Federal District Court Rules That Texas Corporate Defendant Was Not Subject To Personal Jurisdiction In Trade Secret Misappropriation Suit

On March 21, 2012, in the case of Pyro Spectaculars, Inc. et al. v. Souza, Case No. 12-CV-00299-GGH, Magistrate Judge Gregory G. Hollows of the USDC for the Eastern District of California (Sacramento Division), issued an order preliminarily enjoining a former Account Executive for a pyrotechnics company from soliciting the customers of his former employer.  There are several notable

Continue Reading Fireworks Fly, California District Court Enjoins Former Pyrotechnics Company Employee From Soliciting Former Employer’s Customers

In Finkel v. Cashman Professional, Inc., et al., Case Nos. 54520, 55377, 2012 WL 669897 (Nev. March 1, 2012), the Supreme Court of Nevada addressed the validity of non-solicitation, non-competition, and non-disclosure covenants and the proper duration of a preliminary injunction prohibiting disclosure or use of trade secrets. The Nevada Supreme Court received the case after it consolidated two appeals

Continue Reading What Happens in Vegas May Stay in Vegas, But Misappropriation of Trade Secrets and Unauthorized Disclosure of Confidential Information Will Still Land You in Hot Water According To Recent Supreme Court of Nevada Decision

By Justin Beyer

Thompson Reuters (Healthcare) Inc. sued three former executive employees, all formerly working for Thompson Reuters in its pharmacy benefits management and consulting division of its healthcare services arm, in the United States District Court for the Eastern District of Wisconsin on Monday and immediately filed a motion for partial summary judgment against the former executives for a
Continue Reading Former Pharmacy Benefit Management Executives Sued For Alleged Violations Of Customer Non-Solicitation Agreements In Wisconsin Federal Court

By Marcus Mintz

Earlier this month, the Virginia Supreme Court issued an opinion in which it clarified the burdens an employer must meet to enforce a non-compete against a former employee. Specifically, that the employer must demonstrate that the non-compete is no broader than necessary to protect the employer’s “legitimate business interests” and does not “unduly burden” the ex-employee’s right to

Continue Reading Virginia Supreme Court Clarifies Obligations Of Employer Seeking To Enforce Non-Compete

           Delaware Court of Chancery Vice Chancellor J. Travis Laster, faced with an unreasonable non-compete/non-solicitation agreement, indicated that he would have preferred to hold it invalid but said that he had no choice other than to modify its terms because its Maryland choice-of-law provision requires judicial “blue penciling.” He did enjoin the ex-employee from using his ex-employer’s customer list, a trade secret

Continue Reading Delaware Court Enjoins Use of Ex-Employers Trade Secrets

By Paul Freehling

The national CPA firm of Mayer Hoffman McCann P.C. (“MHM”), based in Missouri, scored a major victory when the Eighth Circuit Court of Appeals affirmed a trial court’s injunctions and liquidated damages award of $1,369,921 against four former stockholder-employees in Minnesota. The injunctions prohibited them from soliciting MJM’s clients, directed them and their employees to make their office

Continue Reading Injunctive Relief and a Substantial Monetary Judgment Awarded to National CPA Firm Against Former Employees Who Breached Non-Compete Agreements