Articles Posted in Non-Compete Agreements

Some employers have confronted the situation where employees have taken corporate trade secrets to use in competition against their former employer, but the employees had not signed a non-compete agreement. Under Florida law, however, the fact that the former employees did not sign a non-compete agreement is not dispositive concerning whether the business may enforce…

Under Florida law, courts evaluate the enforceability of non-compete agreements based on Florida Statutes Section 542.335 as well as case law interpreting this statute. Under Section 542.335(1)(b), Florida Statutes, to establish that the contract restricting competition is itself lawful and enforceable, a party must simply “plead and prove the existence of one or more legitimate…

Florida’s non-compete statute, Section 542.335, Florida Statutes, accords broad protection in favor of a business seeking to prevent former employees from competing with the business via goodwill with customers with whom the former employee dealt during his employment. In this regard, section 542.335(1)(b)(3) expressly considers a “legitimate business interest” to include “[s]ubstantial relationships with specific…

The plain terms of a contract control the parties’ course of conduct for all matters subject to that contract’s terms. See Maher v. Schumacher, 605 So.2d 481 (Fla. 3d DCA 1992) (holding that the plain meaning of the contractual language used by the parties controls). The Court is prohibited from rewriting contract terms. Pol v.…

Corporations routinely require their employees to enter restrictive covenants (including non-solicition and non-compete agreements) protecting the business from unfair competition. However, employees often live and reside in states that are different from the company’s place of incorporation and principal place of business. This trend has grown in recent years as some companies have moved toward…

Florida Statutes Section 95.11(2)(b) states in pertinent part that, “[a] legal action on an action on a contract, obligation, or liability founded on a written instrument” is five years. This statute of limitations governs breach of written contracts in business litigation. Florida law imposes a type of “statute of frauds” in cases involving non-compete contracts,…

Some businesses have experienced loss of customer relationships due to former employees taking customer relationships to competitors. The most obvious way to protect against such a situation is to ensure employees sign a restrictive covenant under Florida Statutes Section 542.335, commonly referred to as a non-compete agreement, prohibiting solicitation of customers and competition that diverts…

The Sherman Anti-Trust Act prohibits conspiracies unreasonably restraining trade. A group of competitors cannot enter agreements fixing prices or wages; rigging bids; or allocating customers, workers, or markets. 15 U.S.C. § 1. Consequently, exclusivity contracts and other restrictive covenants reducing competition may violate the Sherman Antitrust Act if they are solely intended to prevent ordinary…

The expiration of a non-compete period does not necessarily mean the covenant is unenforceable. A former employer may be able to enforce a non-compete against a former employee if the non-compete period expired and the non-compete period was tolled by the former employee’s violation of his restrictive covenant. Restrictive covenants, like non-compete agreements and non-solicitation…

Florida employers who have non-compete agreements may enforce the restrictive covenants based on the legitimate business interest of trade secrets under Florida Statutes Section 542.335(1)(b)(1). Employers may also sue for misappropriation of trade secrets. However, employers sometimes sue former employees for common law claims that are related to misappropriation of company trade secrets. Such common…