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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

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

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

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

Can We Still Be Friends? The Uncertain Definition of Non-Solicitation in the Digital Age

Network PeopleAlthough last year’s legislative efforts to ban—or limit further—non-competes in Massachusetts failed, proponents have vowed to revive the issue again in 2015-2016. Excluded from those proposed measures, however, has always been any restriction on employers’ use of customer non-solicitation clauses. Should the Legislature ever pass restrictions on non-competes, employers that have not already done so … 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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