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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 agreement offered for signature after …
Continue Reading You’ve Already Signed Your Offer Letter– Can You Still Be Subject to a Non-Compete Agreement Signed at the Inception of Employment Without New Consideration? Pennsylvania Supreme Court Says Yes

On May 17, 2013, a Pennsylvania appellate court, with one of its judges dissenting, ordered that the trial court award attorneys’ fees to a married couple whose neighbors wrongfully accused them of trade secret misappropriation regarding flagstone artwork. Krafft v. Downey, Pa. Sup. Ct. No. 476 WDA 2012 (Donohue, J.).

According to the majority, plaintiffs Jack and Linda Krafft…
Continue Reading Pennsylvania Appellate Court Orders Sanctions for Plaintiff’s Bad-Faith Trade Secret Misappropriation Claims

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

Pursuant to the “Gist of the Action” doctrine, tort claims may be dismissed if they are “intertwined with,” and not just “collateral to,” contract claims in the same complaint.

In a Pennsylvania federal court case, an ex-employee was accused by his former employer of breaches of confidentiality, non-solicitation and non-compete agreements, and related causes of action. The portion of the…
Continue Reading “Gist Of The Action” Doctrine May Require Dismissal Of Tort Claims Based On Breach Of Restrictive Covenants In Employment Agreement

By Jessica Mendelson and Robert Milligan

Ownership of company social media accounts has recently become a hot topic in the legal industry, and with its decision in Eagle v. Morgan, 2012 WL 4739436, E.D.Pa., October 04, 2012 (NO. CIV.A. 11-4303) this past week, the Eastern District of Pennsylvania has added fuel to the fire.

Edcomm, a banking education company, was…
Continue Reading Pennsylvania Federal Court Dismisses Employee’s Computer Fraud and Abuse Act Claim Based Upon Employer’s Alleged Improprer Access of LinkedIn Account: No Cognizable Damages

By Robert Milligan and Grace Chuchla

In a recent order, a federal court in the Northern District of California weighed in on the validity a forum selection clause contained in an employment agreement in connection with a California employee’s declaratory relief action to invalidate his non-compete provision with his former employer. The court found for the Pennsylvania-based employer and…
Continue Reading California Federal Court Boots Employee’s Challenge Of His Non-Compete Because Of Pennsylvania Forum Selection Provision

On February 27, 2012, a California federal judge for the Northern District of California, decided the case of Hegwer v. American Hearing and Associates, finding that the alleged illegality of a non-compete clause in an employment agreement involving a California employee has no bearing on a legal forum selection clause. Accordingly, the Court transferred the employee’s declaratory relief action to Pennsylvania federal court.…

Continue Reading California Federal Court Ships California Employee’s Declaratory Relief Action Seeking To Invalidate His Non-Compete To Pennsylvania

By Rebecca Woods

In the most recent ruling in long-running litigation styled AMG National Trust Bank v. Ries, NO. 06-CV4337, 09-cv-3061 (E.D. Pa.) (decided Dec. 29, 2011), the Eastern District of Pennsylvania partially granted the defendant Stephen Ries’s motion for summary judgment, jettisoning the plaintiff’s breach of fiduciary duty claims and plaintiff’s request for liquidated damages, but permitting the…

Continue Reading Pennsylvania Federal Court Salvages Customer Lists as Basis for UTSA Claim, But Shreds Liquidated Damages Provision and Rejects Fiduciary Claim

By Justin Beyer

In a matter of first impression, Judge William Standish of the Western District of Pennsylvania ruled in Best Medical Int’l, Inc. v. Spellman, 07-cv-01709-WLS, 2011 U.S. Dist. LEXIS 147853 (W.D. Pa. Dec. 22, 2011), that, pursuant to the Pennsylvania Uniform Trade Secrets Act (“PUTSA”), a defendant may recover attorneys’ fees against a plaintiff where the plaintiff…

Continue Reading Court Rules Pennsylvania Trade Secrets Act Entitles Defendants To Attorneys’ Fees For Bad Faith Misappropriation Claim

By Scott Schaefers

In the age of social media and networking, where employees undoubtedly use their company-issued computers to network with customers, vendors, colleagues, and friends, a legal question presents itself: can employers claim an interest in their employees’ LinkedIn accounts, or other social networking accounts, which the employees use in part to grow and maintain their relationships for the…
Continue Reading Employers May Have Sweat Equity In Their Executives LinkedIn Accounts, But Employees Score Win In War Over The Applicability Of The Federal Computer Fraud And Abuse Act In The Workplace