MIAMI NON-COMPETE AGREEMENTS: WHEN COURTS WILL ISSUE AN INJUNCTION TO PROTECT AN EMPLOYER

Florida law sets forth detailed statutory rules governing enforcement of restrictive covenants, commonly known as “non-compete agreements.” Florida Statutes, section 542.335, provides that parties may agree to restrict or prohibit competition in certain circumstances, so long as they protect one or more legitimate business interests and are reasonable in geographic and temporal scope. In determining whether to enforce a non-compete agreement, Florida courts assess whether enforcement of the non-compete will ultimately protect against unfair competition. Under Florida law, set forth in F.S. § 542.335(1)(h), “[a] court shall construe a restrictive covenant in favor of providing reasonable protection to all legitimate business interests established by the person seeking enforcement.” Peter Mavrick is a Miami non-compete attorney, and also advocates for clients in Fort Lauderdale, Boca Raton, and Palm Beach. The Mavrick Law Firm represents clients in business litigation, trade secret litigation, non-compete agreement litigation, employment litigation, trademark litigation, and other legal disputes in federal and state courts and in arbitration.

In the recent appellate decision GFA International, Inc. v. Trillas, 2021 WL 3889283 (Fla. 3d DCA 2021), Miami’s Third District Court of Appeal reversed a trial Judge’s decision to deny an injunction against a former employee who was competing against the employer. The appellate court took the extraordinary measure of remanding the case to the trial court for entry of a temporary injunction in favor of the employer. The employer, GFA International, Inc. (GFA), was an engineering company that had hired Eric Trillas (Trillas) to serve as its inspections manager. GFA promoted the employee to branch manager of its Miami location, and he managed the day-to-day operations of the branch including overseeing marketing, sales, finances, and helping bring in new clients and work for GFA. Trillas was in charge of the facility support services department, which provided post storm engineering consulting, assisted with developing marketing materials, advertised GFA’s post hurricane marketing services, and brought in clients for post storm-related services.

During his employment, Trillas signed a restrictive covenant that prohibited during his employment, and for two years thereafter, (1) any direct or indirect competition against GFA and (2) accepting any business from any of GFA’s existing or prospective customers. Trillas also contractually agreed to refrain, during his employment and for two years post-termination, from soliciting GFA’s GFA’s existing and prospective clients. Aside from Florida’s restrictive covenant statute governing an employee’s competitive acts against his or her employer, Florida common law also prohibits an employee’s competition during the employment relationship. Under Florida law, an employee may not engage in disloyal acts in competition against his or her employer, and this includes disloyal acts in anticipation with competition against his or her employer.” Fish v. Adams, 401 So.2d 843 (Fla. 5th DCA 1981). The case facts indicated that Trillas violated both his statutory non-compete duties as well as his common law duties barring competition against his employer GFA.

Despite signing this non-compete agreement, during his employment Trillas started a competing business and diverted business from GFA. In this competing business, Trillas performed post storm damage evaluations even though GFA was performing those very same services. The appellate court explained, “Trillas was specifically responsible for developing that department at GFA.” Thereafter, Trillas left his employment with GFA and continued his competitive acts by performing post storm damage evaluation and forensic consulting services. The appellate court added, “Trillas also continued working for GFA clients, including Keys Claims, which he had personally brought in as a client for GFA.”

GFA sued Trillas and alleged that, unbeknownst to GFA and while still employed by GFA: (1) Trillas went into direct competition against GFA to perform storm damage evaluations even though GFA was performing those services, (2) Trillas engaged in acts to promote his own self-interest in direct competition against GFA while serving as a high management level employee privy to confidential information, and (3) Trillas used his position with GFA client Keys Claims, as well as other insurance adjustors and clients, to divert and steal GFA’s existing an prospective customers for his own company.

In a lawsuit seeking enforcement of a restrictive covenant, the employer is required to “plead and prove the existence of one or more legitimate business interests justifying the restrictive covenant.” Surgery Ctr. Holdings, Inc. v. Girguis, 318 So.3d 1274 (Fla. 2d DCA 2021). The appellate court in GFA International, Inc. v. Trillas explained that GFA pleaded and proved that the non-compete covenants “reasonably served a legitimate business interest.” The court added that “Trillas did not challenge the enforceability of the restrictive covenants nor did the [trial] court make any finding that the covenants were unenforceable.” Instead, Trillas argued that “because he was responsible for developing the FSS department as a stronger line of business for GFA and brought in Keys Claims as its client, there should be some exception permitting him to perform forensic engineering for Keys Claims and other adjustors … after his termination from GFA.” The appellate court held to the contrary. Citing the Surgery Ctr. Holdings case, the appellate court stated that, “When the terms of a noncompete agreement are clear and unambiguous, the contracting parties are bound by its terms.” “GFA established the violations of the restrictive covenants by competent, substantial evidence, raising the presumption of irreparable injury. That presumption was not rebutted by any evidence in the record. Accordingly, we conclude the trial court abused its discretion in finding, contrary to the unrebutted evidence, that there was insufficient evidence of a violation of an enforceable restrictive covenant.”

Peter Mavrick is a Miami-Dade non-compete lawyer who also practices non-compete litigation in Palm Beach, Boca Raton, and Fort Lauderdale. This article does not serve as a substitute for legal advice tailored to a particular situation