Tag Archives: noncompete law

Michigan’s Attorney General Recommends More Scrutiny for Enforcing Noncompete Restrictions

Michigan’s Attorney General (AG) Dana Nessel joined 17 other State Attorneys General to respond to the Federal Trade Commission’s (FTC) request for public comments. These comments concern the FTC’s public hearings on Competition and Consumer Protection in the 21st Century. Ms. Nessel’s response echoes a growing concern across the United States about the use and … Continue Reading

Companies Should Already be Doing What Oregon’s Amended Non-compete Law Requires

A recent non-compete related law in Oregon caught my attention. Specifically, Oregon law (HB 2992), provides that noncompete agreements entered into after January 1, 2020, will only be enforceable against Oregon employees if the employer provides the departing employee with a signed copy of the agreement within 30 days after the employee’s date of termination. … Continue Reading

Is Interference from Over Agressive Noncompete Litigation to Blame for Slow Wage Growth?

Despite a strong jobs report on May 3, 2019, wage growth continues to be a disappointment. See Axios post, “The Mystery of Sluggish Wages.” I don’t have all the answers, but I can point to at least a partial explanation for this mystery; the employment market is often contractually rigged by employers using overbroad contractual … Continue Reading

Inconsistent Non-compete Restrictions Limits Employer’s Protections

A common mistake employers make in protecting their business interests is poorly drafted non-compete agreements. And frequently that mistake involves drafting inconsistencies. As explained below, inconsistencies provide a foundation for challenging the scope or outright enforceability of a company’s non-compete restriction. In this regard, we recently defended against Christian Financial Insurance/Christian Insurance Group, Inc.’s motion … Continue Reading

FTC Considers Restricting Noncompete Agreements

Will the playing field be leveled between employers and employees when it comes to non-compete agreements? Perhaps if anything comes out of the Federal Trade Commission’s (FTC) hearings held last 9/13 and 9/14, which focused on how the agency’s competition and consumer protection approaches are working. One area of focus is whether enforcement practices need to … Continue Reading

Before Accepting a new Position, are you Required to Sign a Non-compete Agreement?

A former employee recently sued MedMar Inc. and its related companies. The suit, Greenswag v MedMar Inc., pending in the Cook County Circuit Court, alleges the defendants made misrepresentations about the employment opportunity to induce him to sign a non-compete restriction. I haven’t reviewed the complaint, but these sorts of claims are often unsuccessful. This is … Continue Reading

When it Comes to Enforcing a Noncompete Agreement is Timing Everything?

A recent noncompete case from Minnesota offers a cautionary tale for employers and cause for celebration for employees. The case, Safety Center, Inc. v. Stier, (11/6/17), involved an employer that ran a treatment center for special-needs sex offenders. The employer sought to enforce its noncompete agreement against a former program director (Stier). The noncompete agreement … Continue Reading

Four Take-Aways from an Employer’s Misuse of Overly Broad Noncompete Agreements

Using a broad brush to draft noncompete agreements that are applied universally to a company’s workforce is increasingly coming under fire. And this exposes companies to unnecessary litigation risks, as well as legal fees associated with enforcement costs. Employer Abuse of Noncompete Restrictions A recent example of involves Law360 and its settlement with the New … Continue Reading

Trade Secret Computer Inspections Should Require More than Knee Jerk Reactions

A lawsuit involving trade secret misappropriation recently brought to mind the definition of a “knee-jerk reaction;” an “automatic and unthinking” response. Specifically, our law firm filed a lawsuit for breach of contract involving unpaid commissions and other claims on behalf of a former executive. In response, the former employer manufactured filed a counter-claim for trade secret misappropriation … Continue Reading

Noncompetition Agreements – Impediment to Employee Mobility and Innovation?

The Wall Street Journal, by Aruna Viswanatha, recently asked whether Noncompete Agreements Hobble Junior Employees. Spoiler alert — they do. According to the Journal: Noncompete agreements—common in computing and engineering jobs, where proprietary technology can be at stake—are spreading to other industries and stretching further down the corporate ladder. Labor-law experts say some employers appear … Continue Reading

Non-Solicitation Restrictions – A Valuable Tool for Protecting Your Company’s Customer Relationships

When it comes to post employment restrictions, non-compete agreements often get all the attention. In fact, such restrictions are a frequent subject of discussion on our law firm’s blog (Noncompete Restrictions: The First Line of Defense for Protecting the Company from Unfair Competition). However, as explained below, a carefully drafted non-solicitation provision should be in … Continue Reading

Noncompete Restrictions: The First Line of Defense for Protecting the Company from Unfair Competition

Business involves competition. But not all competition is lawful. Two former employees found this out the hard way after a judge determined on May 22, 2015 that they had wrongfully started a competing business while they continued to work for their employer along with misappropriating trade secrets and engaging in other wrongful acts (Nedschroef Detroit … Continue Reading

Michigan Court Orders Former Employee to Give Up Company, Move it, or Shut it Down After Violating Noncompete Agreement

Not many people would jump out of a plane and then worry about figuring out what to do about a parachute on the way down. But often times individuals take that approach when it comes to starting a new business or taking a job after having signed a non-compete agreement. And that lack of planning can … Continue Reading

The Foundation of Michigan Non-compete Law

Crain’s Detroit, by Dustin Walsh, reported last week that this year marks the 30 year anniversary of arguably the most significant Michigan court opinion concerning non-compete agreements. See “30 Years Later, A Noncompete Ruling has Been Forged into Law.” The case referenced in this article comes from a January 17, 1985 Michigan Supreme Court decision … Continue Reading

Is Your Non-Compete Agreement Enforceable? Depends on What Law Applies.

A recent Delaware court case invalidating an employer’s non-compete agreement provides a cautionary reminder for companies with operations and employees in multiple states. Specifically, in Ascension Ins. Holdings, LLC v. Underwood (Delaware, Jan. 28, 2015) the company, Ascension was incorporated in Delaware, but headquartered in California. California was also where the employee, Roberts Underwood worked. … Continue Reading

An Uber Example of Getting Caught with Your Hand In Your Employer’s Cookie Jar

Uber and Lyft are both internet and mobile application based technology companies offering a peer-to-peer ridesharing platform. Or for less tech-speak, they are involved in what is generally described as the “sharing economy.” However, a recent lawsuit makes clear that sharing has its limits. Specifically, Lyft is suing a former executive (Lyft v Uber (PDF)), … Continue Reading

Michigan Court Cuts Down Non-Compete Agreement

Abraham Lincoln once noted that if he had six hours to chop down a tree, he would spend the first four sharpening the axe. For employers, that sort of up-front attention to details is especially important when it comes to non-compete agreements. Otherwise, as a recent Michigan Court of Appeals illustrates, the only thing likely to … Continue Reading

Common Mistakes that Derail Enforcement of a Noncompete Agreement

Our law firm was recently hired to represent clients – former employees – being sued for allegedly violating a noncompete agreement, trade secret misappropriation, and other business related claims. As is typical with these sorts of cases, the Plaintiff, the former employer, was seeking injunctive relief in the form of a temporary restraining order (TRO) … Continue Reading

Is Your Non-compete Agreement Enforceable? Not Without a “Reasonable Competitive Interest”

“Sticking feathers up your butt, does not make you a chicken.“ Tyler Durden, Fight Club Under Michigan law, one required element for having an enforceable non-compete agreement is a “reasonable competitive business interest.” But, like the chicken quote, business owners can’t expect to just stick the phrase “reasonable competitive business interest” into an employee agreement … Continue Reading

What Steps Can Your Business Take to Avoid Becoming a Victim of Trade Secret Theft?

Trade secret theft continues to be a major concern (or it should be) for businesses. And the numbers back up this conclusion; In an article by  by Will Yakowicz, appearing in Inc., “How to Avoid Becoming a Victim of Trade Secret Theft,” it’s noted that: Criminal theft of corporate trade secrets is reaching epidemic levels, experts say … … Continue Reading
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