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Texas Court Reminds: Lost Sales Are Not Lost Profits

Proof of damages in restrictive covenant matters can be complicated.  In Rhymes v. Filter Resources, Inc., the Ninth Court of Appeals in Beaumont, Texas reminded parties that revenue and sales are not the same as lost profits, and expenses must be considered when developing a damage model. George Rhymes (“Rhymes”) was employed by Filter Resources (“Filter”) … Continue Reading

SEC Fines Company $265,000 for Severance Agreements that Potentially Chilled Whistleblowers

Our Corporate Governance Practice Group posted  this article regarding further activity by the Securities and Exchange Commission in response to confidentiality provisions it found might deter potential corporate whistleblowers under the Dodd-Frank Act. Employers should be reminded to carefully draft non-disclosure of confidential information provisions clearly not to prohibit employees from reporting violations of law or cooperating … Continue Reading

Colorado Broadens Whistleblower Protection for State Employees Who Disclose Confidential Information

Tim Kratz and Kristen Baylis in our Denver office have reported on an important new law in Colorado, extending whistleblower protection to state employees who disclose confidential information in the context of reporting waste, mismanagement of public funds, abuses of authority or illegal and unethical practices to a designated “whistleblower review agency.”  To review the article, click here … Continue Reading

Utah Enacts New Laws Addressing Post-Employment Restrictions and Unauthorized Computer Use

Conrad S. Kee from our Salt Lake City office and Cliff Atlas, co-chair of the firm’s non-compete practice group have written on the firm’s website about two new important laws in Utah, the Post-Employment Restrictions Act and the Computer Abuse and Data Recovery Act.… Continue Reading

Unintended Consequences of Arbitration Provisions

A recent unpublished decision of the United States District Court, Eastern District of Pennsylvania, highlights the importance for employers to review carefully their agreements containing restrictive covenants to ensure they do not unintentionally limit the available avenues for relief. In Healthcare Servs. Grp., Inc. v. Fay, 2015 BL 33694 (Oct. 14, 2015), Healthcare sued two … Continue Reading

Florida Appellate Court Rules Former Customers Are Not a Legitimate Business Interests

A recent case from Florida’s Fifth District Court of Appeals underlines the importance for employers to provide a sufficient legitimate business interest to justify enforcement of a non-compete agreement. Where a former employee or contractor is interfering with client relationships, the employer must be careful to point out specific prospective or existing clients when enforcing … Continue Reading

Louisiana Court of Appeals Holds Non-Compete Was Triggered When Employment Agreement Expired, Not When Actual Employment Ended

The Louisiana Court of Appeals, First Circuit, recently affirmed a lower court’s denial of a preliminary injunction to enforce a covenant not to compete in Gulf Industries, Inc. v. Boylan (La. App. 1 Cir. June 6, 2014). The case demonstrates continued careful scrutiny by Louisiana courts of non-compete agreements. Gulf Industries provides highway safety, highway construction, … Continue Reading

Either Way You Say it, It’s Unauthorized: Mass. Federal Court Declines to Dismiss CFAA Claim

On November 12, 2013, A court in the U.S. District Court for the District of Massachusetts issued a decision concerning the ongoing debate about the meaning of “exceeding authorized access” under the Computer Fraud and Abuse Act. Moca Systems, Inc. v. Bernier, No. 13-10738-LTS (D. Mass. Nov. 12, 2013). MOCA Systems, Inc. filed suit against its former … Continue Reading

The Georgia Restrictive Covenants Act – Two Years Later

As previously reported in a legal alert issued by Jackson Lewis on May 12, 2011, Georgia Governor Nathan Deal signed the Georgia Restrictive Covenants Act into law almost two years ago, on May 11, 2011.  Since that time, many employers have required employees to sign new covenants that comply with the law. The Georgia Restrictive … Continue Reading

North Dakota Non-Compete Law Shares History with California

North Dakota has one of the fastest-growing workforces in the country as the result of recent advances in extracting natural gas and oil.  As more employers seek to hire in or transfer employees to the Peace Garden State, many are surprised to discover that North Dakota law prohibits non-compete agreements. North Dakota Century Code Section … Continue Reading

NY Appellate Division Rejects Challenge to Forum and Choice of Law by California Defendant

In the latest chapter of an ongoing dispute between Aon Risk Services and Alliant Insurance Services (stemming from Alliant’s hiring of dozens of Aon employees and accepting millions in annual revenue from former Aon clients), on January 10, 2013, the New York State Supreme Court, Appellate Division, First Department issued a decision upholding key rulings of the … Continue Reading

Will Tolling Provisions Gain Popularity?

Tolling clauses in non-compete agreements extend the period of noncompetition by a period of time usually equal to the time an employee is in violation.  Appellate courts in some states, including Illinois and Massachusetts, have affirmed injunctions based on contractual extension clauses. For example, in Prairie Eye Center v. Butler, No. 4-01-0005 (Ill. Ct. App. … Continue Reading

Trade Secrets – Is Kevlar the New Coke?

Kevlar (R), a high-strength para-aramid fiber created by E. I. du Pont de Nemours and Company and famously used in body armor for soldiers and police officers, is the subject of a recent criminal indictment by the U.S. Justice Department against Kolon Industries, Inc. and several of its executives. According to the October 18, 2012 press … Continue Reading
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