Colorado Court Provides Guidance On Enforceability of Covenants Not to Compete Against "Management Personnel"


In Colorado, covenants not to compete are void unless they fall within one of four statutorily defined exceptions. One of the exceptions that is unique to Colorado is that covenants that restrict "executive and management personnel and officers and employees who constitute professional staff to executive and management personnel" are permissible. Thus, for executive and management employees and their professional staff a covenant not to compete is lawful even in the absence of evidence that the management employee will threaten to disclose trade secrets.1

The Colorado Court of Appeals previously provided a test for determining who is professional staff to executive and management personnel.2 The Colorado Court of Appeals has now, in DISH Network Corp. v. Altomari, (No. 08CA1741, June 25, 2009), provided guidance on who is "executive and management personnel." Concluding that the plain, dictionary meaning of "management personnel" must be applied to the statute, the appellate court held that even mid-level supervisors who lack key decision-making authority are properly the subject of a covenant not to compete in Colorado.

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