PODCAST: Williams Mullen's Benefits Companion - ERISA Forfeiture Litigation
The Federal Trade Commission’s (FTC) ban on noncompetition covenants (“noncompetes”) could significantly impact the design and administration of employee benefits and executive compensation arrangements....more
The Federal Trade Commission (“FTC”) recently issued a Final Rule (the “FTC Rule”) that, unless invalidated by the courts, will soon prohibit most non-compete provisions. In its current form, the FTC Rule will cover not...more
On April 23, 2024, the Federal Trade Commission issued its final rule imposing a nationwide ban on employers using post-employment non-competes with current and former workers. Other than narrow exceptions for (1) existing...more
FTC RULE BANS NON-COMPETE CLAUSES FOR NON-SENIOR EMPLOYEES - Non-compete clauses have long been a contentious issue in employment agreements, with concerns raised about their potential to stifle competition and limit...more
Less than two months after the Delaware Supreme Court provided the employers, investment partners and other business leaders that trust in the stability of Delaware law to protect their critical business interests with the...more
Last week, the Delaware Supreme Court reversed a Chancery Court decision that we wrote about previously, which invalidated a forfeiture-for-competition provision as an unreasonable restraint of trade. The Ainslie et al. v....more
In a win for businesses that rely on restrictive covenants to protect their assets and investments, on January 29, 2024, the Delaware Supreme Court unanimously reversed a Chancery Court decision that invalidated a...more
Forfeiture clauses are one tactic. They provide a meaningful disincentive for employees to engage in competitive behavior. Noncompetes are under siege on multiple fronts. Originally published in Legal Dive - September...more
On January 4, 2023, in Ainslie, et al. v. Cantor Fitzgerald, L.P., the Delaware Court of Chancery invalidated the forfeiture-for-competition provision in the financial services company’s limited partnership agreement, based...more
The Treasury Department’s proposed regulations regarding the income tax treatment of “ineligible plans” of tax-exempt employers under Code Section 457(f), published in June 2016, were greeted with much fanfare. (You can...more
This edition of Employment Flash looks at developments in labor and employment law, including a Supreme Court ruling that Title VII’s charge-filing requirement is nonjurisdictional and new state legislation in New York,...more
Even before the California Supreme Court decided Edwards in 2008, employers knew all too well the woes of attempting to enforce non-competes against California employees. Edwards simply reaffirmed California’s long-standing...more
California has long led the nation in its disdain for noncompetition agreements. Pressed by venture capitalists who believe that this gives California an advantage over other states, the Massachusetts legislature has finally...more
The 2016 proposed regulations significantly expanded 457(f) plan sponsors’ ability to permit elective deferrals, use noncompetition agreements and make larger severance payments than otherwise permitted under 409A without...more
Introduction Jimmy John’s In 2014, Emily Brunner (“Brunner”) and Caitlin Turowski (“Turowski”) filed a complaint in Illinois against the sandwich company, Jimmy John’s, and its franchise affiliates. The complaint was amended...more
On June 21, 2016, after more than 15 years of ongoing deliberations, the U.S. Department of the Treasury (the Dept. of Treasury) issued proposed regulations under Section 457 of the Internal Revenue Code of 1986 (the Code),...more
After more than nine years of deliberations, the IRS has finally released proposed regulations governing all types of deferred compensation plans maintained by non-profit organizations and governmental entities. In...more
The Treasury Department and the Internal Revenue Service recently issued comprehensive proposed regulations governing nonqualified plans subject to tax under Internal Revenue Code § 457. Code § 457 prescribes the tax rules...more
On June 21, 2016, the Internal Revenue Service (IRS) issued long-awaited proposed Treasury Regulations prescribing rules under Section 457 of the Internal Revenue Code (the "Code") for the income taxation of deferred...more
On June 22, 2016, the IRS published much-anticipated proposed regulations under Internal Revenue Code Section 457 impacting certain plans maintained by state or local governments or other tax-exempt organizations that provide...more
In many industries, it is common to pay incentives in the form of restricted stock options payable in the future if certain conditions are satisfied. In Exxon-Mobil v. Drennen, decided on August 29, 2014, the Texas Supreme...more
On August 29, 2014, the Texas Supreme Court in Exxon Mobil Corp. v. Drennen upheld a noncompete-triggered forfeiture provision in an executive compensation plan that applied New York law. This is a landmark decision in a...more
In light of the restrictive nature with which South Carolina courts have historically viewed noncompetition agreements, many people assume they are not enforceable and, in essence, “not worth the paper they’re written on.”...more