Archives: Common Law Duty of Loyalty

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Eighth Circuit Finds Non-Compete May be Assignable Under Arkansas Law; Reverses Dismissal of Breach of Fiduciary Duty and Conspiracy Claims Where Manager took Subordinates with him.

The Eight Circuit has concluded that the Arkansas Supreme Court would likely adopt the majority rule that a covenant not to compete can be assigned to the purchaser of a business. Stuart C. Irby Company, Inc. v. Tipton, No. 14-1970 and 14-2682 (8th Cir. Aug. 6, 2015) The appellate court reversed an across-the board win … Continue Reading

“Loyalty” Provision Actually an Unenforceable Restraint of Trade, Georgia Court Rules

Many employers require their employees sign agreements containing a “loyalty provision.” That is, a clause that requires the employee to devote all or most of his/her working time to the employer’s endeavors, while the employee remains employed by the employer. What many employers fail to realize, however, is that some states treat such loyalty provisions … Continue Reading

Claims in Pennsylvania Lawsuit Alleging En Masse Defection of Employees as “Sabotage” Survive Dismissal

A U.S. District Judge in the Eastern District of Pennsylvania has allowed several claims to proceed to trial following a motion for summary judgment by defendants in Ozburn-Hessey Logistics, LLC v. 721 Logistics, LLC, et al, No. 12-0864 (April 4, 2014). The allegations in the case go beyond the typical defection of an employee or two to … Continue Reading

Criminal Prosecution for Employee Theft of Employer’s Documents May Proceed, New Jersey Court Rules

Our colleague Jason C. Gavejian has written about an interesting case in New Jersey involving the criminal prosecution of an employee who took highly confidential documents from her employer to support her employment discrimination suit.  The decision distinguishes a 2010 New Jersey Supreme Court ruling in which the court held that an employee who copied employer records for use in … Continue Reading

North Dakota Supreme Court Upholds Judgment for Competing in Breach of Employment Contract while Still Employed

The North Dakota Supreme Court upheld a judgment finding two employees of SolarBee, Inc., a North Dakota corporation that manufactures solar-powered water circulators, liable for a total of $621,800 in damages for breaching a non-compete agreement while still employed.  The Court’s decision in SolarBee, Inc. v. Walker, No. 2012015 (June 24, 2013), is a reminder … Continue Reading
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