As many of our blog readers will know, the enforceability of restrictive covenants often depends on which state’s law applies to the dispute. For example, California is well known for refusing to enforce employee non-competition agreements and, recently, refusing to honor forum selection clauses in agreements with California employees without the employee first receiving legal advice. In contrast, with limited exceptions, most other states will generally enforce restrictive covenants. Consequently, for employers, controlling and choosing the correct law to apply to its restrictive covenant agreements can be critical to protection of its business interests.
Continue Reading 6th Circuit Bolsters Employer’s Right to Contract for Chosen Law
Court Upholds Non-Compete Giving Former Employer Discretion To Determine Whether Ex-Employee Is Working For A Competitor
A severance agreement executed in connection with a Stark Truss employee’s resignation included a one-year non-competition clause. It allowed the company unfettered discretion to decide if his new employer was a competitor and, if so, to terminate his severance. The ex-employee took another job and sued Stark Truss in an Ohio court, seeking a declaration that he was entitled to
Continue Reading Court Upholds Non-Compete Giving Former Employer Discretion To Determine Whether Ex-Employee Is Working For A Competitor
Employee’s Competition With Former Employer Restricted Despite Absence Of Signed Non-Compete
The former employer failed to prove that the parties entered into an effective non-compete agreement, and also failed to prove that the ex-employee had disclosed or had threatened to disclose trade secrets. But, an Ohio federal judge entered a preliminary injunction forbidding her, until further order, from contacting her former employer’s clients and certain of its prospects. PharMerica Corp. v.
Continue Reading Employee’s Competition With Former Employer Restricted Despite Absence Of Signed Non-Compete
Ohio Court Issues Significant Non-Compete Decision: Damages for a Breach are the Payor’s Lost Profits, Not the Amount of Consideration
The usual measure of monetary damages for violation of a covenant not to compete, even where the violator was paid a discreet sum for the covenant, is the amount that puts the injured party in the same position it would have been in if the contract had been performed. Briggs v. GLA Water Management, 2014 Ohio 1551 (Ohio App.,
Continue Reading Ohio Court Issues Significant Non-Compete Decision: Damages for a Breach are the Payor’s Lost Profits, Not the Amount of Consideration
Ohio Supreme Court Reverses Course In Important Non-Compete Decision
The Supreme Court of Ohio yesterday issued its decision on a motion to reconsider the Court’s opinion announced May 25, 2012 regarding an important non-compete issue.
In that earlier sharply divided ruling, the Court affirmed the appellate court’s holding that non-competition agreements entered into by a corporation and then transferred by operation of law to an L.L.C. into which the
Continue Reading Ohio Supreme Court Reverses Course In Important Non-Compete Decision
Keep Your Pot of Gold Hidden, Ohio Court Rules Information Posted Online Not Trade Secret
St. Patrick’s Day calls to mind the traditional Irish folklore of leprechauns and their hidden pots of gold. These hidden pots of gold illustrate the fundamental and straightforward rule for protecting prized trade secret information – keep it secret. A recent Ohio District Court, the Honorable Judge Michael R. Barrett presiding, denied a Plaintiff’s motion for Temporary Restraining Order because
After Ohio Jury Finds Trade Secret Misappropriation But Awards Zero Damages, Trial Judge Enters Injunction Order But Sets Royalty Payment As Alternative
A manufacturer engaged an independent contractor to improve the efficiency of certain machinery. After the task was completed, the contractor did the same for a competitor of the manufacturer. The manufacturer, claiming that the improvements were its trade secrets, sued the competitor in an Ohio state court for misappropriation. The case went to trial before a jury which returned a verdict
Right to a Jury Trial for Unjust Enrichment Claims
I start by warning you that this case is old, over 5 years old, in fact. However, when it arrived in my regular e-mail of case synopses, I thought I would take a look, and given the long, slow holiday week, I thought it might have a nugget to share and to keep in mind as we go into 2010.
The
Continue Reading Right to a Jury Trial for Unjust Enrichment Claims
Ohio Appellate Court Upholds Entry of Temporary Injunction
The Ohio 12th District Court of Appeals recently uphelda lower court’s injunction against two former employees and their new employer in light of defendants’ apparent breach of duty of loyalty, misappropriation of trade secrets, and tortious interference with business relations. DK Prods., Inc. v. Miller, Case No. CA2008-05-060, 2009 WL 243089 (Ohio Ct. App. 12 Dist. Feb. 2
Continue Reading Ohio Appellate Court Upholds Entry of Temporary Injunction
Trade Secrets Derive From “Equitable Principles” Rather Than Property or Contract Rights
The Sixth Circuit Court of Appeals recently held that whether a trade secret is a protectable interest is an equitable question not affected by the lack of a written instrument. Niemi v. NHK Spring Company, — F.3d —, 2008 WL 4273123 (6th Cir. Sept. 19, 2008).
Richard Niemi is an individual engineer who provides various automobile company manufacturers