Tag Archives: non-compete

Utah Hopes That Third Time’s a Charm for Non-Compete Statute

The State of Utah on March 22, 2019 returned to the topic of non-competes for the third time in three years. It had passed that statute in 2016 (as we noted), and then amended in 2018 (as we also discussed here earlier), and now is at it again, by amending it once more. Maybe they are hoping that the third time’s a charm, as they say.

Read more

Read full article

Bipartisan Group of Six Senators Seeks GAO Review of Non-Competes

On March 7, 2019, a bipartisan group of U.S. Senators sent a letter to the Government Accountability Office (“GAO”), requesting that the agency perform a review of the effect of non-competition agreements “on workers and on the economy as a whole.” The six signatories to the letter were Chris Murphy (D-CT), Todd Young (R-IN), Elizabeth Warren (D-MA), Marco Rubio (R-FL), Tim Kaine (D-VA), and Ron Wyden (D-OR). In particular, they asked the GAO to assess:

Read more

Read full article

Even If “Secret,” Information Will Not Qualify As a “Trade Secret” Unless Adequate Measures Were Taken To Protect That Secrecy

A federal judge in Chicago recently taught a painful lesson to an Illinois employer: even if information is sufficiently sensitive and valuable that it could qualify as a “trade secret,” it won’t unless the owner of the information took adequate steps to protect its secrecy.

Read more

Read full article

Sixth Circuit Greenlights Employer’s Broad Attorney Fee Provision

Employee restrictive covenant agreements often contain fee-shifting provisions entitling the employer to recover its attorneys’ fees if it “prevails” against the employee. But “prevailing” is a term of art in this context. Obtaining a TRO or preliminary injunction is not a final decision on the merits, so does obtaining a TRO or preliminary injunction trigger a fee-shifting provision? A recent case illustrates that an employer can sidestep this potentially thorny issue by using careful and thoughtful drafting.

Read more

Read full article

Of Non-Competes, Elizabeth Warren and Marco Rubio

In the last couple of years, there have been a number legislative efforts, at both the state and federal level, to limit the use of non-competes in the U.S. economy, particularly with respect to low wage and entry level workers.  Recent bills introduced in the Senate indicate there is a strong opportunity for a bipartisan path to enactment of such a law by the U.S. Congress.

Read more

Read full article

Second Court Calls into Question Viability of Employee Non-Solicitation Agreements

As we’ve discussed, the California Court of Appeal in AMN Healthcare, Inc. v. Aya Healthcare Services, Inc., recently ruled that a broadly worded contractual clause that prohibited solicitation of employees for one year after employment was an illegal restraint on trade under California law.

Read more

Read full article

Illinois Appellate Court Declines to Adopt Bright Line Rule That a Five Year Non-Compete Or a Three Year Non-Solicit Are Unenforceable Per Se

The Illinois Appellate Court recently declined to adopt a bright line rule regarding the enforceability of five year non-competes or three year non-solicits, and instead directed courts to interpret the reasonableness of any such restrictive covenants on a case-by-case basis.

Read more

Read full article

California Court of Appeal Questions Continuing Viability of Employee Non-Solicitation Agreements

In its 2008 landmark decision Edwards v. Arthur Andersen LLP (2008) 44 Cal. 4th 937, the California Supreme Court set forth a broad prohibition against non-compete provisions, but it left open whether or to what extent employee non-solicit provisions were enforceable. Since Edwards, no California appellate court has addressed that issue in a published opinion – until recently. On November 1, the California Court of Appeal in AMN Healthcare, Inc. v. Aya Healthcare Services, Inc., ruled that a broadly worded contractual clause that prohibited solicitation of employees for one year after employment was void under California Business and Professions Code section 16600, which provides “Except as provided in this chapter every contract by which anyone is restrained from engaging in a lawful profession, trade or business of any kind is to that extent void.” The decision calls into question the continuing viability of employee non-solicitation provisions in the employment context, and employers who regularly include such provisions in their agreements should reassess their use and enforcement of those provisions.

Read more

Read full article

Recent Decision Questions Use of No-Poach Clauses in Franchise Agreements

States across the country have been using enforcement actions, legislation, and interpretive guidance to limit employers’ ability to enforce restrictive covenants against low wage workers. The recent decision in Butler v. Jimmy John’s Franchise, LLC et. al., 18-cv-0133 (S.D. Ill. 2018) suggests this trend may extend to federal antitrust law.

Read more

Read full article

New York Attorney General Issues Non-Compete Agreements FAQ

On September 19, 2018, the New York Attorney General (“NYAG”) released a Frequently Asked Questions document (“FAQ”) regarding non-compete agreements in New York. The FAQ posits and answers the following basic questions about non-competes:

Read more

Read full article