Archives: Non-Competition

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Here We Go Again: Massachusetts Non-Compete Legislation Back in Play

As we previously reported, the Massachusetts House and Senate passed contrasting versions of non-compete reform bills in 2016 but were unable to come to an agreement by the end of the legislative session. Efforts began anew last month as Senator William Brownsberger and Representative Lori Ehrlich filed a new non-compete bill on January 20: An … Continue Reading

White House Issues State Call to Action on Non-Compete Reform

The White House, Washington DC with two flags in frontThis week, the Obama Administration continued its ongoing efforts to curb what it considers to be the “gross overuse” of non-compete agreements. In a “State Call to Action,” the White House encourages legislatures to adopt certain recommendations for non-compete reform. Tuesday’s announcement follows the Obama Administration’s May 2016 report, “Non-Compete Agreements: Analysis of the Usage, … Continue Reading

Recent Decisions Highlight Courts’ Reluctance to Modify Overbroad Non-Compete Provisions

Blue PencilIn what may be a trend, several courts around the country this year have embraced strict interpretations of non-compete agreements, refusing to blue pencil or equitably reform overbroad or unreasonable clauses in non-compete agreements. Traditionally, courts have exercised the doctrine of equitable reformation to re-write provisions to render them reasonable, or at the very least, … Continue Reading

Massachusetts Non-Compete Reform: Maybe Next Year

Once again, the Massachusetts legislature took on non-compete reform, and once again, came up empty-handed. On July 31, 2016, the legislature adjourned without reaching a compromise to alter the state’s non-compete landscape. Earlier this summer, both the House and the Senate passed contrasting versions of non-compete reform bills, but ultimately could not come to agreement … Continue Reading

Mid-Year Review: New Non-Compete Legislation in 2016

USA-ThinkstockPhotos-99935661In the first half of 2016, we have already seen significant changes to a number of state non-compete laws. In this post, we provide a compilation of recently enacted legislation in Alabama, Connecticut, Idaho, Oregon, and Utah, as well as several important developments at the federal level. Against this nationwide backdrop, there is non-compete legislation … Continue Reading

Illinois Attorney General Sues Jimmy John’s Over Non-Competes

Submarine SandwichLast week, the Illinois Attorney General filed suit against Jimmy John’s, alleging that the company’s non-competes violate state law. These non-competes prohibit all employees, including sandwich makers, from working during their employment and for two years afterward at businesses within several miles of any Jimmy John’s nationwide that earn more than 10% of their revenue from … Continue Reading

White House Weighs in on Ongoing Non-Compete Battle

As states continue to struggle with the pros and cons of non-competes, the White House has recently weighed in, siding largely with critics of non-competes.  In Non-Compete Agreements: Analysis of the Usage, Potential Issues, and State Responses, the Obama Administration draws on a recent report from the U.S. Treasury Office of Economic Policy to provide … Continue Reading

The Latest Massachusetts Non-Compete Bill Contains Some Surprises

Earlier this week, the Joint Committee on Labor and Workforce Development released proposed amendments to the Uniform Trade Secrets Act, which would include the creation of the Massachusetts Noncompetition Agreement Act. The legislation, if enacted, would significantly alter the non-compete landscape, rendering unenforceable or practically unworkable most Massachusetts employers’ non-competition agreements. Here are some of … Continue Reading

Utah and Idaho Take Contrasting Approaches to Non-Compete Reform

Utah-Idaho MapIn the last few weeks, Utah and Idaho have each passed bills changing the landscape of non-compete enforceability in strikingly different ways. Utah’s law places further limitations on the use of non-competes. In contrast, the Idaho bill (expected to be signed by the governor shortly) permits greater enforceability of non-competes. Utah Imposes New Restrictions on … Continue Reading

Take Care in Drafting: Meschino v. Frazier Industrial Co. Is a Cautionary Tale for Employers

Non disclosure agreementIn Meschino v. Frazier Industrial Co., Civil No. 15-10327-RGS, 2015 WL 7295463 (D. Mass. Nov. 18, 2015), Judge Stearns held that an employment agreement superseded an earlier employment agreement and a separate earlier confidentiality and non-compete agreement. A 2005 employment agreement provided that the employee would be required to execute a separate confidentiality and non-compete … Continue Reading

The House Speaker Proposes New Non-Compete Legislation in Massachusetts

This morning, House Speaker Robert DeLeo announced at a Greater Boston Chamber of Commerce breakfast that the House will be releasing a bill this session that imposes some limitations on non-competes. Although the language of the proposed bill is not yet available, Speaker DeLeo described two key elements: Time Limit: The proposed bill would limit … Continue Reading

Massachusetts Courts Continue to Reject Inevitable Disclosure Doctrine

Judge Janet L. Sanders of the Superior Court’s Business Litigation Session has continued the trend of Massachusetts courts refusing to recognize the inevitable disclosure doctrine. In The Gillette Company v. Craig Provost et al, Civ. Action No. 15-0149 (Mass. Sup. Dec. 22, 2015), Gillette moved for a preliminary injunction to prevent its former counsel and … Continue Reading

Massachusetts Federal Court Reaffirms That Continued Employment Constitutes Sufficient Consideration for Non-Compete

In American Well Corporation v. Obourn, Civil No. 15-12265-LTS, 2015 WL 7737328 (D. Mass. Dec. 1, 2015), Judge Sorokin of the United States District Court for the District of Massachusetts upheld a non-compete entered into seven months after the employee’s start date. The Court explained that as to whether continued employment constitutes sufficient consideration for a … Continue Reading

Protected Occupations: Statutory Exemptions from Non-Competes for Employee Classes

DiverseProfessions-ThinkstockPhotos-166843143The states have a rich tradition of passing legislation forbidding or limiting the use of non-compete agreements with identified classes of employees. As you might expect, a number of states forbid or limit the use of non-compete agreements with: Physicians, nurses, psychologists, social workers and other medical professionals Lawyers Individuals working in broadcasting Public health, … Continue Reading

Consistency Is Key: Corporate Enforcement Practices in Non-Competes Critical to Judicial Review

A recent decision from a Wisconsin state court serves as a cautionary tale for employers that do not routinely impose or enforce non-compete restrictions consistent with the employee’s role and potential to harm the business. In Kohl’s Department Stores Inc. v. Janet Schalk, 2015CV001465 (Wis. Cir. Ct. Aug. 11, 2015), Judge Robert Mawdsley denied Kohl’s … Continue Reading

Pennsylvania Supreme Court Rejects Continued Employment as Sufficient Consideration for Non-Compete

Employment Contract- CropThe Pennsylvania Supreme Court recently held in Socko v. Mid-Atlantic Systems of CPA, Inc. that a non-compete is enforceable only if a current employee receives new consideration beyond continued employment. The Court held that this is the case even if a non-compete provides that the parties “intend to be legally bound,” which typically obviates the need … Continue Reading

They’re Not Dead Yet: Massachusetts Courts Continue to Enforce Non-Competes and Enjoin Defendants in the Right Circumstances

Detail of exterior of courthouseIn Pegasystems Inc. v. Appian Corp., Judge Mitchell Kaplan of the Massachusetts Business Litigation Session enjoined a sales employee from working for a competitor for three months. This recent opinion highlights some common issues in Massachusetts non-compete law and illustrates judges’ broad discretion to fashion relief.… Continue Reading

Be Careful What You Wish For: Employer’s Arbitration Clause Backfires

A recent decision from the Business Litigation Session of the Massachusetts Superior Court has broad implications for non-compete cases involving arbitration clauses. In TIBCO Software, Inc. v. Zephyr Health, Inc. and Kevin Willoe, the court denied an employer’s motion for a temporary restraining order enforcing a non-compete, finding the employer’s own arbitration provision required it … Continue Reading

State-Specific Quirks May Thwart Unwary Employers

USA MapMassachusetts employers and employees have enough to contend with trying to keep abreast of the judicial and legislative fits and starts of non-compete reform within the state, let alone developments in other states. It is important to remember that non-compete law varies widely from state to state, and these variations may come into play if … Continue Reading
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