2024 was a year in which there were significant developments with respect to restrictive covenants, particularly for employment noncompete agreements. As our readers are aware, the Federal Trade Commission (FTC) published a...more
Arizona employer cannot exclude settlement communications from former employee’s retaliation complaint - In Flores v. Rafi Law Group PLLC, the plaintiff accused her law firm employer of retaliating against her by (i)...more
In a previous article that we published in October 2023, we detailed California’s forthcoming amendment to its noncompete law. That law, which is codified in California Business & Professions Code sections 16600 et seq, voids...more
Hiring an applicant who has a non-compete or non-solicit agreement with a prior employer creates risk for the both the individual and the new employer. The prior employer can sue both the applicant for violating the contract...more
Providers negotiating with doctors and other medical professionals who are bound by enforceable restrictive covenants is tricky business. By virtue of his/her/their position, these physicians may owe fiduciary duties to the...more
In a recent decision, a federal trial court in Illinois allowed an employee’s tortious interference claim to continue against his former employer alleging it had exaggerated the reach of a noncompete agreement that he had...more
Over the past two years, employee mobility seems to be at an all-time high. In fact, the labor market is so fluid that pundits and experts often refer to it as the “Great Resignation.” Although employee mobility can be a...more
At the end of a complicated case, an employer obtained a nearly $7.5 million jury verdict in enforcement of restrictive covenant agreements and as a result of the unfair competition and breaches of the duty of loyalty of a...more
In what may seem to be a surprising series of events, given the state’s infamous hostility to restrictive covenants, a California appellate panel recently affirmed a Los Angeles Superior Court judgment effectively enjoining...more
In 2021, the Delaware Court of Chancery issued two decisions addressing when a contractual party’s affiliates are bound to restrictive covenants in an agreement. In the first case, Sixth Street Partners Management Company,...more
In a recent decision, Ixchel Pharma, LLC v. Biogen, Inc., the Supreme Court of California opened the door for some restrictive covenants between commercial enterprises, but it left alone California law generally prohibiting...more
Ixchel Pharma, LLC v. Biogen, Inc., 9 Cal. 5th 1130 (2020) - In this commercial dispute between two companies, the California Supreme Court determined the bounds of a claim for tortious interference of an at-will contract...more
In Ixchel Pharma, LLC v. Biogen, Inc., 20 Cal. Daily Op. Serv. 7729, __ P.3d __(August 3, 2020), the California Supreme Court made it easier for businesses to enforce restrictive covenants against other businesses. This...more
California is known for having the most aggressive approach among the states regarding restraints on profession, trade, and business. Specifically, California Business and Professions Code section 16600 codifies this...more
Welcome to The Franchise Memorandum by Lathrop GPM, formerly known as The GPMemorandum. Below are summaries of recent legal developments of interest to franchisors. Given the widespread and evolving impact of the COVID-19...more
Two recent cases have found that employee non-solicitation agreements, at least in the form many companies currently use, are unlawful in California. In AMN Healthcare, Inc. v. Aya Healthcare Services, Inc., 28 Cal. App. 5th...more
Employers with California operations probably know that traditional noncompetition covenants are unenforceable in that state. Additional state court decisions concluded that customer non-solicitation prohibitions are also...more
Against the backdrop of a continuing trend of low rates of unemployment throughout the United States, there has been a recent surge of people searching for new and better jobs. As a result, there has also been increased...more
In a meaty decision involving the intersection of restrictive covenant and franchise law, the United States District Court for the Southern District of Ohio recently denied a request by D.P. Dough Franchising, LLC (“D.P....more
An employer hiring an individual known to be subject to a non-compete contract can expect to be accused of tortiously interfering with that contract. On the other hand, the hiring employer should be innocent of wrongdoing if...more
Reversing a 2-1 decision of the North Carolina Court of Appeals, the state’s Supreme Court held unanimously that an assets purchase-and-sale contract containing an unreasonable territorial non-competition restriction is...more
Those of you reading our Employee Mobility blog posts are familiar with California’s unique approach to non-compete agreements: they are, except in a few limited circumstances, unenforceable in the Golden State. And that...more
The U.S. District Court for the Southern District of New York recently cleared the way for a Michigan watchmaker to pursue claims for trade secret misappropriation, among other things, against two former employees who left to...more
In our last two posts, we identified best practices for ensuring that a company’s house is in order, including the use of narrowly tailored restrictive covenant agreements (Part I) and adopting a company culture and behaviors...more