Smooth Transitions

Smooth Transitions

addressing the Legal issues arising from the departure of employees & Business breakups

Category Archives: Non-Solicitation Agreements

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Don’t Steal My Employees When You Quit – the Anti-Raid Provision

Posted in Anti-Raid, Confidentiality, Non-Compete Agreements, Non-Solicitation Agreements, Trade Secrets, Uncategorized
  The usual gamut of post-employment covenants includes non-compete restrictions, non-solicitation of customer restrictions, confidentiality restrictions, and in many cases the anti-raid provision designed to keep a departing employee from hiring away a former employer’s employees and contractors.  The anti-raid is not always given a lot of thought, but it should be.  Why?  Because when… Continue Reading

The Non-Compete Buyout

Posted in Hiring and Firing, HR Issues, Injunction, Non-Compete Agreements, Non-Solicitation Agreements, Trade Secrets
  One option we’ve never spent much time discussing here as it relates to non-competes is the buyout option – on both sides.  Buying out a non-compete is neither new nor novel.  Physician non-competes in Texas require that the non-compete provision include a buyout option.   The statute provides: the covenant must provide for a… Continue Reading

NY Times Non-Compete Article

Posted in Injunction, Non-Compete Agreements, Non-Solicitation Agreements, Trade Secrets
I don’t think I’ve ever dedicated a post to a newspaper article but a recent New York Times article entitled “How Noncompete Clauses Keep Workers Locked In” does a great job addressing the human toll of non-competes.  Here is a link to the article.  The article is generally anti-non-compete when it comes to lower paid… Continue Reading

Why Texas lawyers aren’t subject to non-competes.

Posted in Injunction, Non-Compete Agreements, Non-Solicitation Agreements
  Quite often I have lawyer friends ask me why Texas lawyers (and lawyers from other states) aren’t the subject of non-competes?  There aren’t really any cases that I’ve run across on the subject, which sometimes is an indicator that law firms aren’t trying to enforce them.  The answer is not that complicated. Queue Texas… Continue Reading

Texas Non-Competes Without Geographical Restrictions

Posted in Injunction, Non-Compete Agreements, Non-Solicitation Agreements, Trade Secrets
A Texas non-compete must satisfy two main components to be enforceable. The non-compete has to be ancillary to an otherwise enforceable agreement and be reasonable in time and scope. Before the Texas Supreme Court this week was a case where the court was asked to consider a non-compete without a geographical restriction and consider whether such an… Continue Reading

Nothing Like A Hair Stylist Non-Compete Case

Posted in HR Issues, Injunction, Non-Compete Agreements, Non-Solicitation Agreements, Recent Cases, Uncategorized
The details are slim from a recent article from the New York Post about a $3 million dollar non-compete/breach of contract case against a New York City hair stylist.  What we know: Stylist Annie Rush worked at the salon for 6 years; Apparently she is alleged to have signed a 1 year non-compete (that is… Continue Reading

Utah Leads the Way on Non-Compete Legislation

Posted in Injunction, Non-Compete Agreements, Non-Solicitation Agreements, Uncategorized
  I went to school in Utah and manage to ski up there every so often.  That’s a picture of my son and I in December.  Recently I ran accross an article  breaking down changes to Utah’s and Idaho’s non-compete laws.  The Utah statute really grabbed my attention.  The highlights: (1) non-competes can only last… Continue Reading

Breaking Down the Texas Non-Compete Case

Posted in Executive Compensation, Hiring and Firing, Injunction, Non-Compete Agreements, Non-Solicitation Agreements, Recent Cases
  There is a good article from the Houston Chronicle this week outlining a non-compete dispute between two former compensation consultants and their former employer.  The facts are pretty standard fare for this type of dispute: professionals have some type of non-compete agreement with former employer; former employer finds out professionals are leaving in violation… Continue Reading

Top 10 From Texas Non-Compete Camp

Posted in Arbitration, Confidentiality, Non-Compete Agreements, Non-Solicitation Agreements, Presentations, Trade Secrets, Trial and Pre-Trial Procedure
Last week I had the privilege of speaking and attending the Texas Non-Compete Camp put on by UT LAW CLE and Mike Maslanka.  There were a number of great lawyers there addressing topics ranging from whether to sue the new employer of a former employee to ethical considerations of representing both the employee and employer.… Continue Reading

Hawaii Non-Compete Legislation

Posted in Non-Compete Agreements, Non-Solicitation Agreements, Trade Secrets, Uncategorized
It’s always interesting to take a look at other states to see how they deal with non-compete legislation.  We’ve discussed Masschusetts and most recently doctor non-competes in New Mexico.  Hawaii is the latest state to enact new noncompete legislation targeting workers in a “technology business”.  This is how the Hawaii legislature defined “technology business”:  … Continue Reading

5 Injunction Non-Compete Lessons

Posted in Injunction, Non-Compete Agreements, Non-Solicitation Agreements, Trade Secrets, Trial and Pre-Trial Procedure, Uncategorized
For the last few months I’ve been involved in a number of temporary restraining order/preliminary injunction cases in state and federal courts in a number of different industries/professions. Some general reminders/lessons from non-compete/non-solicit fights: Signed Agreements – Make sure the non-compete agreements at issue are signed.  Some companies have their employees execute agreements on line… Continue Reading

Non-Compete Legislation – The Jimmy John’s Backlash

Posted in Non-Compete Agreements, Non-Solicitation Agreements
When news of the Jimmy John’s non-compete came out last October my concern was the impact it would have on businesses with legitimate non-competes.  There is always a populist theme that is anti-non-compete.  Employees should be able to come and go as they please and a non-compete agreement prevents that.  “Bad” non-competes undermine “good” non-competes.  There… Continue Reading

Texas Non-Competes – The More Things Change…

Posted in Injunction, Non-Compete Agreements, Non-Solicitation Agreements
It’s been 3 and a half  years since the Marsh opinion that redefined what could constitute consideration for a Texas non-compete and courts have bee relatively quiet on non-competes since then.   That’s not surprising from the Texas Supreme Court as Marsh was the third of a trilogy of opinions dealing with the subject.  Appellate courts… Continue Reading

Amazon on the Prowl

Posted in Injunction, Non-Compete Agreements, Non-Solicitation Agreements
In Seattle, former Amazon Web Services Strategic Partnership Manager Zoltan Szabadi was sued by Amazon for violation of his non-compete agreement.  Szabadi is now with Google in their cloud platform business.  The lawsuit alleges: Szabadi was directly and integrally involved with the marketing of Amazon’s cloud computing business to its partners and resellers, and played… Continue Reading

Cold Call Agreements? – Not So Fast Says the DOJ

Posted in Non-Solicitation Agreements
                                                          We have previously addressed rumblings that the Department of Justice was investigating agreements between companies where they agreed not to contact each other’s employees for hiring purposes.  The companies involved were Adobe, Apple, Google, Intel, Intuit and Pixar.  In the competitive impact statement, the DOJ outlined the nature of the agreements.  For example, the… Continue Reading

Non-Competition Without a Non-Compete

Posted in Non-Solicitation Agreements
In Texas there are other options to prevent departing employers from competing with your business: A Non-Solicitation: Instead of tying down your employee with a non-compete consider a non-solicitation. The non-solicit will still have to meet non-compete standards, but it can be used for specific customers as opposed to geographic areas. The rub, there will always be… Continue Reading

Non-solicits that address social media communications.

Posted in Non-Solicitation Agreements
                                        Typically, employers use non-compete clauses to prevent former employees from competing with them after they’ve provided them with trade secrets, customer information, or other proprietary information. Non-solicits can essentially have the same effect – by restricting or preventing a former employee from calling on or contacting former customers. Here is an example: You hereby agree and… Continue Reading

Caught Red Handed with LinkedIn

Posted in Non-Compete Agreements, Non-Solicitation Agreements, Placement Professionals
                                               Minnesota based TEKsystems Inc. sued three former employees for violating non-compete and non-solicit agreements.  TEKSystems is in the technical recruiting business and it claims one of the former employees was contacting its contract employees.  The complaint alleges Defendant Brelyn Hammernik used LinkedIn to solicit these employees: For example, Hammernik has communicated with at least 20 of TEKsystems’ Contract Employees… Continue Reading

Non-Solicitation TRO Denied in Broker Case

Posted in Financial Advisors, Non-Solicitation Agreements
  Judge William C. Griesbach, of the Eastern District of Wisconsin, recently denied a request for a temporary restraining order filed by Smith Barney against several departing brokers and their new employer, Robert W. Baird & Co.  Smith Barney sought a TRO in conjunction with Rule 13804 of the FINRA Code of Arbitration Procedure, meaning entry… Continue Reading

Prospective Employees with Non-Competes

Posted in Hiring and Firing, Non-Compete Agreements, Non-Solicitation Agreements
With employers aggressively protecting customers and trade-secrets with non-compete agreements,  placement and human resource professionals will continue to encounter potential candidates/employees that have non-compete agreements and other restrictive covenants.    Every employment interview should include exploration into these issues.  Below are some suggested questions/considerations: Has the candidate signed a non-compete, non-solicitation, or non-disclosure agreement?  If so, request… Continue Reading
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