Is this non compete agreement enforceable? 9 Answers as of April 18, 2014

I was employed by company A. I was assigned to work for our client company B. At the time I was employed, I also signed a non compete agreement, which states that "I shall not directly or indirectly engage in any business activity that is or may be competitive with company A in any state where company A conducts its business, unless I can prove that any action taken in contravention of this agreement was done without the use in any way of confidential information." This January, Company B decided to turn my contractual position into a full time one (in other words, instead of outsourcing the job to another company like A, B wants to have the jobs done internally and permanently). B then created a job position and posted it publicly. I applied and got the offer. When I informed A after accepting the offer, I was fired me on the spot. Then, I started working for B. Now my ex-boss threatened to sue me for breaching the non compete agreement. My concern is, B changed this from contractual to full time, and thus A will not get this position in the future, regardless of who gets the job. Can this still be regarded as competition? Secondly, I am not a core member of company A, thus I do not have any confidential information (trade secret/bid strategy/client list) from A. Moreover, because the goal of the two companies are different, any inside information in A that I limited know would not interest or benefit B at all. Is this NCA enforceable?

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Strouse Legal Services | James C. Strouse
NCA sounds too broad to be enforced. I'd have to see the agreement though.
Answer Applies to: Maryland
Replied: 4/18/2014
WILLIAM L SANDERS, ATTORNEY AT LAW | William L. Sanders
I do not answer questions about non-compete agreements unless I read the entire document. I am unable to answer your question.
Answer Applies to: Georgia
Replied: 4/16/2014
KEYL ADR Services, LLC | Mark D. Keyl
I think it is questionable. Generally speaking, non-competes are not enforceable if they are written too broadly. This one seems broadly written. I don't know how a court would interpret it, so if they push the issue, talk to an attorney.
Answer Applies to: Mississippi
Replied: 4/16/2014
Barton Barton & Plotkin
Barton Barton & Plotkin | Maurice Ross
Yes you are clearly violating this non-compete agreement. Further, you are engaging in a rather outrageous breach of your fiduciary obligations to Company A. Company A placed you with Company B, and in so doing, company A earns fees from Company B. You are wrongly taking advantage of the situation in a conspiracy with Company B to cut out Company A from getting paid for placing you there. It is inconceivable to me that you could think it would be appropriate to take this position with Company B. Talk about bad faith. If you wanted to go to Company B, you had an obligation to be honest with Company A and Company B and ask them to work out a settlement so that Company A does not get cut out economically. You can get sued for a lot of money for this misconduct-which is rather outrageous.
Answer Applies to: New York
Replied: 4/16/2014
Peters Law, PLLC
Peters Law, PLLC | Mark T. Peters, Sr.
The real problem here is that A should have had an agreement with B that if B hires A's people, B would pay 6 months of your salary to A. That is what I put in my agreements and it is only fair. A's argument is really with B. But if they want to sue you, I suppose you give the complaint to B and see what it says.
Answer Applies to: Idaho
Replied: 4/16/2014
    Law Office of Richard Winkler | Richard Winkler
    Non-competes can be enforceable depending upon the type of business, the duration of the agreement, the geographic limitations and the consideration paid for agreeing to the non-compete.
    Answer Applies to: Rhode Island
    Replied: 4/16/2014
    Fox & Fox, S.C. | Richard F. Rice
    Any lawsuit would likely be against both you and Company B. So does Company B know about your non-compete with Company A? Ideally, you would have informed Company B about your non-compete with Company A before you applied for an accepted the job with Company B.
    Answer Applies to: Wisconsin
    Replied: 4/16/2014
    Mains Law Office
    Mains Law Office | Julie Mains
    You should look up Cal. Business and Professions Code 16600. It sounds as if your non compete is void and unenforceable in California since you are not a business owner and not privy to confidential trade secrets of the company. Your former employer's threat are not legally enforceable in California based on the information you have provided.
    Answer Applies to: California
    Replied: 4/16/2014
    Musilli Brennan Associates PLLC
    Musilli Brennan Associates PLLC | John F Brennan
    I cannot tell without a review of all the documentation. Non-competition agreements are certainly legal in Michigan, and one of the reasons for them is to keep companies which had previously been contracting outside company's employees from converting those jobs to full-time, inside positions, and stripping the contracting company of its employees by hiring them. Obviously, assuming that the contracting company was making money with the placement, that is competitive and detrimental to the contract employee's previous company. On the other hand, I would be surprised that company B was not constrained, and in fact prohibited, from hiring previous contract employees for at least a period of time or without providing some form of consideration to company A. That is normally how contract employee providing the company protects itself.
    Answer Applies to: Michigan
    Replied: 4/16/2014
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