Smooth Transitions : Rob Radcliff : Texas Non-Compete Lawyer & Attorney : Langley Weinstein LLP Law Firm : Dallas Employment & Employee Departures : Smooth Transitions Law Blog

In a recent article about employee poaching Mark Hendricks profiled the common practice of poaching a competitor's talent.  In the article he noted:

1. Employers like to hire people who are employed, not unemployed; 
2. Reaching potential hires through social networking tools like LinkedIn has made poaching easier; and
3. Potential employers need to worry about non-solicitation agreements, non-compete agreements and other confidentiality provisions a poached employee may have signed. 

My thoughts:

1. Do your due diligence in determining what post-employment covenants a potential hire may have -this may impact whether you want to make the hire;
2. Make the employee certify in writing that there are no post-employment covenants that would affect their future employment;
3. Make it clear that if the case turns out that there are post-employment covenants, the employer may terminate the employee and not necessarily defend them in any type of lawsuit;
4. Make  new employees certify that they have not taken any confidential or proprietary information that belongs to their former employer; and
5. Remember – what goes around, comes around.

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There have been numerous discussions here regarding individuals chronicling their daily lives through the use of Facebook, Twitter, blogs and other social media. We can provide location information through foursquare or talk about our job through a Facebook status update or Twitter tweet. The possibilities are endless and lawyers are beginning to focus on social media outlets in the discovery process.  

In a recent post by 3 Geeks and a Law Blog, the authors examine a defense attorney’s request for social media information related to a personal injury plaintiff.  Specifically, the Court addressed whether the defendant was entitled to the current and historical Facebook and MySpace pages of the plaintiff.  The defendant claimed it has reason to believe the plaintiff had posted pictures and information clearly demonstrating he was not suffering injuries or a loss of enjoyment of life – a claim in the lawsuit.

The Court agreed and ordered that the plaintiff provide a properly executed consent that would allow for obtaining Facebook and MySpace information. The discovery requests were narrowly tailored and sought information specifically related to the plaintiff’s alleged damages. It was not a fishing expedition.  What if the defense attorney wants more general information?  She could use Twitter or Facebook entries basically to recreate a time line of events for various plaintiffs and defendants in cases.  The same goes with other information offered in social media outlets, like blogs, foursquare, and LinkedIn.  It will be interesting to see how Courts handle these type of discovery issues.   A rule of thumb - assume everything posted or authored on these sites is discoverable.

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We've previously discussed  the lucrative compensation packages wire houses use to attract high producing FAs.  The mechanics of those packages usually include a signing bonus, but it's not an up front bonus like the 1st round draft choice in the NFL draft receives.  In many instances it is a forgivable promissory note conditioned on the  broker staying a certain time period.  If they leave early the broker must pay it back.

Recently, Judge Lewis Kaplan of the Southern District of New York dismissed a group of former Citigroup brokers' lawsuit who left employment early and refused to pay off their loans.  Typically, breach of a promissory notes is almost impossible to defend.  It's a simple proposition, I loan you money you have to pay it back.

The Judge was not impressed with the Plaintiffs' case:

These plaintiffs all received substantial interest-free advances when they joined Smith Barney . . . They all promised to repay Smith Barney over terms of years out of their compensation and to repay any unpaid balance if they left the firm ‘for any reason or no reason.’ Having left the firm without repaying everything they owed, they brought this baseless lawsuit in what quite plainly was a studied effort to prevent collection of the debts they owed through the arbitration process.

Brokers should assume that if they are going to sign a note like this, they are going to have to pay it back unless they stay the term of their agreement.  

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