The Alleghany Court of Common Pleas in Pittsburgh, Pennsylvania, recently denied a law firm’s request to enjoin its former partner from retaining a database that contained various information used to file legal actions under the American with Disabilities Act. According to the law firm, the database was a “trade secret” of the firm, and consequently,

The Attorneys General of ten states are investigating fast food franchisors for their alleged use of “no poach” provisions in their franchise agreements, according to a press release by the New Jersey Attorney General’s Office, and as reported by NPR.  In a July 9, 2018 letter, the Attorneys General for New Jersey, Massachusetts, California, Washington, D.C., Illinois, Maryland, Minnesota, New York, Oregon, Pennsylvania, and Rhode Island requested information from eight fast food companies about their alleged use of such provisions.  The letter states that the Attorneys General “have learned that certain franchise agreements used in our States and the District of Columbia . . . may contain provisions that impact some employees’ ability to obtain higher paying or more attractive positions with a different franchisee.”  In other words, the agreements purportedly prohibit one franchisee of a particular brand from hiring employees of another franchisee of the same brand.  
Continue Reading

A recent decision from the Eastern District of Pennsylvania reinforces the importance of the timing of purported misconduct in alleged violations of the Computer Fraud and Abuse Act (CFAA) and Defend Trade Secrets Act (DTSA). In Teva Pharmaceutical USA, Inc. v. Sandhu, et al., 2018 WL 617991 (Jan. 30, 2018), Judge Savage found that a defendant former executive could not be liable under the CFAA for conduct that occurred while she had authorized access to computers from which she misappropriated trade secrets. Id. at *1. However, the court also found that CFAA claims could be brought against the recipients of those trade secrets under an “indirect access” theory, and that DTSA claims could be brought on the basis of activity that began before the enactment of the DTSA but continued to occur after its passage.
Continue Reading

shutterstock_114348199In 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.

A non-competition covenant prohibited employees of Adhesives Research (AR), a company based in Pennsylvania, from performshutterstock_129702905ing 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,

A Florida franchisee executed a franchise agreement (FA) containing a non-compete provision and a Pennsylvania forum selection clause.  Following termination of the FA, the former franchisee’s wife opened a similar business in another part of Florida.  The franchisor filed suit in Pennsylvania against the former franchisee and his wife, and they moved to dismiss or,

A state court issued a preliminary injunction for alleged trade secret misappropriation, but the enjoined parties successfully used post-injunction discovery to convince the court that the complaint was baseless.  Those parties then filed a federal court lawsuit for abuse of process and other torts.  In Peek v. Whittaker, Case No. 2:13-cv-01188 (W.D. Pa., May

Dating comes with its own set of challenges, and apparently, these now include trade secrets!  This month, a speed dating service provider, Speed Date USA Inc. (“Speed Date”) filed a multi-million dollar lawsuit against Match.com (“Match”) in Pennsylvania federal court.

According to the Complaint, the parties had an agreement under which Speed Date would

According to the allegations in a recently filed complaint, Defendant Implementation Management Assistance, Inc. (“IMA”) hired a long-time employee, Liana Hans, away from competitor Plaintiff Triage Consulting Group, Inc. (“Triage”). Hans allegedly had intimate knowledge of Triage’s proprietary systems and allegedly shared that knowledge with IMA, in derogation of her confidentiality agreement with Triage. IMA

Is new consideration required for a valid covenant not to compete presented to an employee at the inception of their employment after they sign their offer letter? 

Under the majority approach, recognized in many states continued employment is sufficient consideration for a valid non-compete agreement.  However, a minority of jurisdictions, will not enforce a non-compete