A business purchaser often requires the seller to sign a non-compete provision as part of the sale. Purchasers usually require non-compete provisions to prevent the business seller from starting a new rival business that deprives the purchaser of the value of the assert he or she purchased. The same logic applies to the business’s employees.…
Continue reading ›A business that is unsure about its contractual rights may be able to assert a claim for declaratory judgment. Under Florida Statute § 86.011, courts may “render declaratory judgments on the existence, or nonexistence: (1) of any immunity, power, privilege or right; (2) of any fact upon which the existence of nonexistence of such immunity,…
Continue reading ›Under Florida law, employees have a duty of loyalty to their employers. The breadth of the duty of loyalty depends on whether the employee qualifies as a fiduciary under the law. High level employees, such as corporate officers and directors, hold a strict fiduciary duty of loyalty to a corporation. The fiduciary duty of loyalty…
Continue reading ›Businesses often rely on restrictive covenants to protect their sensitive business information and to protect themselves from unfair competition. Businesses often require employees to sign non-compete agreements and employee confidentiality agreements to accomplish these goals. Businesses also often include similar provisions when they purchase all or part of another business. A purchaser will include…
Continue reading ›The defenses of unclean hands and in pari delicto are useful in commercial and business disputes. These are similar defenses that arise when the party bringing the lawsuit possesses a level of fault or guilt. Unclean hands and in pari delicto can be applied in business disputes under certain circumstances to prevent an actor from…
Continue reading ›The Federal Trade Commission’s rule banning most non-compete agreements is now before a federal appellate court. On May 7, 2024, the FTC proposed a rule that would have banned most non-compete agreements. This rule would have substantially impacted many businesses because non-compete agreements are used to prohibit employees from using the company’s information to compete…
Continue reading ›A lawsuit is generally considered over once a litigant obtains judgment in its favor assuming no appeal is taken and no post-judgment collection issues exist. However, the losing party is often left unsatisfied. Therefore, the loser may try to “re-do” the lawsuit by suing the defendant again using slightly different claims or lodging the lawsuit…
Continue reading ›Non-compete agreements have received significant attention this year after the Federal Trade Commission issued a rule on April 23, 2024, banning most employee non-compete agreements. The rule was scheduled to go into effect on September 4, 2024. However, on August 20, 2024, a court in the United States District Court for the Northern District of…
Continue reading ›Many businesses require employees, independent contractors, and others to sign restrictive covenants. Common restrictive covenants are non-compete covenants prohibiting competition with the business, non-solicitation covenants prohibiting solicitation of the businesses’ customers and employees, and non-disclosure covenants preventing the disclosure of certain company information. However, these covenants have certain restrictions on enforceability. Some of those restrictions…
Continue reading ›Businesses commonly enter into restrictive covenants with their employees to prohibit them from unfairly competing with the business during and after employment. Restrictive covenants include contracts that restrict competition, such as non-compete agreements, non-disclosure agreements, and confidentiality agreements. When preparing a restrictive covenant, what provisions should be included? Typically, a business should include provisions that…
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