With the economic downturn and the recent layoffs and involuntary terminations of numbers of productive employees, the enforceability of employee restrictive covenants has become and will remain a major issue for both companies and former employees. Restrictive covenants, more commonly known as non-compete agreements, seek to restrict the right of an employee to compete with his or her prior employer in a competing business or prohibit contact with prior clients, customers or long time business contacts. The covenants are often included in employment agreements, incentive compensation plans, and stock options plans when executives and employees have no incentive or reason to focus on the future consequences that may arise at the time of an involuntary separation from or termination of employment. However, following termination such covenants limit an employee’s right to accept a new job and earn a living.
More commonly in today’s economy, companies are trying to enforce restrictive covenants through inclusion in separation and severance agreements after termination. Even where a restrictive covenant is not in effect, a former employee may find pursuit of future employment stifled by duties not to reveal trade secrets of a prior employer. Yet at the same time conflicts arise because an employee's aptitude, skill, dexterity, manual and mental ability and such other subjective knowledge obtained during the course of employment are not the property of the former employer, and cannot be termed a legally protected trade secret
Non Compete Litigation and Resolution
We have successfully litigated and resolved the enforceability of employment restrictive covenants, assuring our clients of the ability to pursue future employment and at the same time enabling and providing our clients with interim severance or other compensation for their interests. We regularly counsel our clients on the enforceability of such post-employment restrictive covenants, negotiate separation and severance packages, and pride ourselves in supplying top quality litigation options for clients when necessary to assure future employment and compensation.
We also have substantial experience in litigation involving unfair competition and misappropriation of customer lists, assets and proprietary information and property on behalf of both company employers as well as former employees.
Examples of our successful results include:
- An injunction on behalf of a business client enforcing a restrictive covenant not to compete in a long term commercial lease. The injunction prevents a competing business from opening and operating on real estate in close proximity to our client’s facility, thereby protecting the client’s financial investment.
- Injunctive relief on behalf of departing minority shareholders which eliminated restrictions on their ability to form a new company and conduct a competing business in the computer tracking of inventory.
- Representation of a senior corporate officer transitioning to new employment and defeat of his former employer’s efforts to restrict his severance and future career opportunities.
We provide big firm quality counseling and litigation representation by experienced litigators—but without inflated duplicative charges and costs. We begin with a free consultation to determine if we can be helpful in a particular business contact.
If you would like to discuss an existing or potential restrictive covenant case, please
contact us via our form or call
888-773-3515 and ask to speak with a non compete litigation attorney.
If you are a lawyer interested in our referral arrangements, please
contact us via our form or call
888-773-3515.