noncompetition and confidentiality provisions in employment agreements

234 Pages·2015·3.87 MB·English

by  Judy Shepard

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ONCOMPETITION AND
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ONFIDENTIALITY
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ROVISIONS IN
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GREEMENTS

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L Prepared in connection with a Continuing Legal Education course presented
at New York County Lawyers’ Association, 14 Vesey Street, New York, NY
C scheduled for November 4, 2015

Program Co-Sponsor: NYCLA’s Judicial Section

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Moderator: Hon. Lucy Billings, NYS Sup. Ct.

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Faculty: Hon. Salliann Scarpulla, NYS Sup. Ct., Commercial Division; Tracee Davis,
Zeichner Ellman & Krause LLP; Rosalind Fink, Brill & Meisel; Kevin Schlosser, Meyer,
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Suozzi English and Klein, P.C.

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This course has been approved in accordance with the requirements of the New York State Continuing Legal Education
Board for a maximum of 2 Transitional and Non-Transitional credit hours:1 Professional Practice/Law Practice
Management; 1 Skills..
This program has been approved by the Board of Continuing Legal education of the Supreme Court of New Jersey for 2
hours of total CLE credits. Of these, 0 qualify as hours of credit for ethics/professionalism, and 0 qualify as hours of credit
toward certification in civil trial law, criminal law, workers compensation law and/or matrimonial law.
ACCREDITED PROVIDER STATUS: NYCLA’s CLE Institute is currently certified as an Accredited Provider of
continuing legal education in the States of New York and New Jersey.

Information Regarding CLE Credits and Certification
Noncompetition and Confidentiality Provisions in Employment Agreements:
Current Status of the Law in New York State and National Trends
November 4, 2015; 6:00 PM to 8:00 PM

The New York State CLE Board Regulations require all accredited CLE
providers to provide documentation that CLE course attendees are, in fact,
present during the course. Please review the following NYCLA rules for
MCLE credit allocation and certificate distribution.

i. You must sign-in and note the time of arrival to receive your
course materials and receive MCLE credit. The time will be
verified by the Program Assistant.

ii. You will receive your MCLE certificate as you exit the room at
the end of the course. The certificates will bear your name and
will be arranged in alphabetical order on the tables directly outside
the auditorium.

iii. If you arrive after the course has begun, you must sign-in and note
the time of your arrival. The time will be verified by the Program
Assistant. If it has been determined that you will still receive
educational value by attending a portion of the program, you will
receive a pro-rated CLE certificate.

iv. Please note: We can only certify MCLE credit for the actual time
you are in attendance. If you leave before the end of the course,
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determined that you received educational value from attending a
portion of the program, your CLE credits will be pro-rated and the
certificate will be mailed to you within one week.

v. If you leave early and do not sign out, we will assume that you left
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received educational value from the portion of the program you
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provide verification of course completion. Your certificate will
be mailed to you within one week.

Thank you for choosing NYCLA as your CLE provider!

New York County Lawyers’ Association

Continuing Legal Education Institute

14 Vesey Street, New York, N.Y. 10007 • [phone]

Noncompetition and Confidentiality Agreements in Employment
Agreements: Current Status of the Law in New York State and National
Trends

Wednesday, November 4, 2015 6:00 PM to 8:00 PM

Program Co-Sponsor: NYCLA’s Judicial Section

Moderator: Hon. Lucy Billings, NYS Sup. Ct.

Faculty: Hon. Salliann Scarpulla, NYS Sup. Ct., Commercial Division; Tracee Davis,
Zeichner Ellman & Krause LLP; Rosalind Fink, Brill & Meisel; Kevin Schlosser, Meyer,
Suozzi English and Klein, P.C.

AGENDA

5:30 PM – 6:00 PM Registration

6:00 PM – 6:10 PM Introduction and Announcements

6:10 PM – 8:00 PM Presentation and Discussion

I. Statutes
a. 2015 Alabama House Bill No. 352, Contracts, use of restrictive covenants
clarified (effective 1/1/2016)
b. California Business and Professions Code, Chapter 1, Contracts in Restraint
of Trade, §§ 16600-16602.5; 16606-16607
c. Colorado Revised Statutes Annotated § 8-2-113, Unlawful to Intimidate
Worker – Agreement Not to Compete
d. Florida Statutes Annotated § 542.335, Valid Restraints of Trade or
Commerce
e. Georgia Constitution, Art. 3, § 6, ¶ V(c)
f. Hawaii Revised Statutes Annotated, § 480-4(c), Combinations in restraint
of trade, price-fixing and limitation of production prohibited
g. Louisiana Revised Statutes Annotated § 921, Restraint of business
prohibited; restraint on forum prohibited; competing business; contracts
against engaging in; provisions for
h. Michigan Compiled Laws Annotated § 445.774a, Agreements not to
compete; application
i. Annotated Missouri Statutes § 431.202, Employment covenants
enforceable, when--reasonability presumption
j. Montana Code Annotated §§ 28-2-703-705, Contracts in restraint of trade
generally void; Exception--sale of goodwill of business; Exception--
dissolution of partnership
k. Nevada Revised Statutes Annotated § 613.200, Prevention of employment
of person who has been discharged or who terminates employment
unlawful; criminal and administrative penalties; exception
l. Revised Statutes Annotated of the State of New Hampshire § 275:70,
Noncompete Agreements
m. New York Senate Bill No. S04447, Labor Law, Article 32, Policy Against
Restraint of Trade (proposed legislation)
n. North Carolina General Statutes Annotated § 75-4, Contracts to be in
writing
o. North Carolina Administrative Code § 29.0502(e)(5)
p. North Dakota Century Code § 9-08-06, In Restraint of Business Void –
Exceptions
q. 15 Oklahoma Statutes Annotated § 219A, Noncompetition Agreements
r. 2015 Oregon Laws Ch. 429, § 653.295, Noncompete Agreements
(effective: 1/1/16)
s. South Dakota Codified Laws § 53-9-8-12, Contracts in restraint of trade
void—Exceptions; Sale of good will--Seller's agreement with buyer to
refrain from carrying on similar business, validity; Dissolution of
partnership--Agreement of partners to refrain from carrying on similar
business, validity; Employment contract--Covenants not to compete;
Contracts of independent contractor who is captive insurance agent--
Covenants not to compete
t. Texas Business and Commerce Code § 15.50-.52, Criteria for
Enforceability of Covenants Not to Compete; Procedures and Remedies in
Actions to Enforce Covenants Not to Compete; Preemption of Other Law
u. 2015 Wisconsin Senate Bill No. 69, Restrictive Covenants in Employment
and Agency Relationships (proposed legislation)
v. Wisconsin Statutes Annotated § 103.465, Restrictive Covenants in
Employment Contracts

II. Court of Appeals Decisions
a. BDO Seidman v. Hirshberg, 93 N.Y.2d 382 (1999)
b. Brown & Brown, Inc. v. Johnson, 25 N.Y.3d 364 (2015)
c. Cohen v. Lord, Day & Lord, 75 N.Y.2d 95 (1989)
d. Columbia Ribbon & Carbon Mfg. Co., Inc. v. A-1-A Corp., 42 N.Y.2d 496
(1977)
e. Denburg v. Parker Chapin Flattau & Klimpl, 82 N.Y.2d 375 (1993)
f. Gelder Med. Grp. v. Webber, 41 N.Y.2d 680 (1977)
g. Karpinski v. Ingrasci, 28 N.Y.2d 45 (1971)
h. Morris v. Schroder Capital Mgmt., 7 N.Y.3d 616 (2006)
i. Reed, Roberts Assocs. v. Strauman, 40 N.Y.2d 303 (1976)

III. Other Appellate Decisions
a. 1 Model Mgmt., LLC v. Kavoussi, 82 A.D.3d 502 (1st Dep’t 2011)
b. Alex Sheshunoff Mgmt. v. Johnson, 209 S.W.3d 644 (Tex. 2006)
c. Atl. Marine Const. Co. v. U.S. Dist. Court for W. Dist. of Texas, 134 S.Ct.
568 (2013)
d. Contempo Commc’ns, Inc. v. MJM Creative Servs., 182 A.D.2d 351 (1st
Dep’t 1992)
e. Crown IT Servs., Inc. v. Koval-Olsen, 11 A.D.3d 263 (1st Dep’t 2004)
f. Del Nero v. Colvin, 111 A.D.3d 1250 (4th Dep’t 2013)
g. Delta Enter. Corp. v. Cohen, 93 A.D.3d 411 (1st Dep’t 2012)
h. Exxon Mobil Corp. v. Drennen, 452 S.W.3d 319 (Tex. 2015)
i. Fewer v. GFI Grp. Inc., 124 A.D.3d 457 (1st Dep’t 2015)
j. Good Energy, L.P. v. Kosachuk, 49 A.D.3d 331 (1st Dep’t 2008)
k. Goodman v. New York Oncology Hematology, P.C., 101 A.D.3d 1524 (3d
Dep’t 2012)
l. Greystone Staffing, Inc. v. Warner, 106 A.D.3d 954 (2d Dep’t 2013)
m. Lenel Systems Intern., Inc. v. Smith, 106 A.D.3d 1536 (4th Dep’t 2013)
n. Maltby v. Harlow Meyer Savage, 166 Misc.2d 481 (Sup Ct, New York
County 1995), aff’d 223 A.D.2d 516 (1st Dep’t 1996)
o. Meghan Beard, Inc. v. Fadina, 82 A.D.3d 591 (1st Dep’t 2011)
p. Samengo-Turner v. J&H Marsh & McLennan (Services) Ltd., [2008] I.C.R.
18 (2007)
q. Steiner Sports Mktg., Inc. v. Weinreb, 88 A.D.3d 482 (1st Dep’t 2011)
r. Suffolk Anesthesiology Assocs., P.C. v. Verdone, 74 A.D.3d 953 (2d Dep’t
2010)
s. Sutherland Global Servs., Inc. v. Stuewe, 73 A.D.3d 1473 (4th Dep’t 2010)
t. Titus & Donnelly, Inc. v. Poto, 205 A.D.2d 475 (1st Dep’t 1994)
u. Weiser LLP v. Coopersmith, 74 A.D.3d 465 (1st Dep’t 2010)
v. Wolf v. Am. Technical Ceramics Corp., 84 A.D.3d 1224 (2d Dep’t 2011)
w. Yedlin v. Lieberman, 102 A.D.3d 769 (2d Dep’t 2013)

IV. Other
a. Natsource LLC v. Paribello, 151 F. Supp. 2d 465 (S.D.N.Y. 2001)
b. Alexandra Wald and Nathaniel P. T. Read, To Quit or Not to Quit?;
Implications of employee notice provisions, NYLJ, 11/13/12, at S4
c. Mark Poerio, Eric Loi, and Peter Heller, The Basics of Garden Leave – And
Why Careful Tilling Is Needed, BNA Pension & Benefits Daily, 164 PBD,
08/24/2011
2015 Alabama House Bill No. 352, Alabama 2015 Regular..., 2015 Alabama House...
2015 Alabama House Bill No. 352, Alabama 2015 Regular Session
ALABAMA BILL TEXT
TITLE: Contracts, use of restrictive covenants clarified, Sec. 8-1-1 repealed
VERSION: Adopted
June 11, 2015
England
Image 1 within document in PDF format.
SUMMARY: An Act, Relating to contract law; to clarify and restate the law relating to restrictive covenants; and to repeal
Section 8-1-1, Code of Alabama 1975
TEXT:
ACT No. 2015-465
HB352
166383-5
By Representative England
RFD: Judiciary
First Read: 31-MAR-15
ENROLLED,
An Act, Relating to contract law; to clarify and restate the law relating to restrictive covenants; and to repeal Section 8-1-1,
Code of Alabama 1975.
BE IT ENACTED BY THE LEGISLATURE OF ALABAMA:
Section 1. (a) Every contract by which anyone is restrained from exercising a lawful profession, trade, or business of any kind
otherwise than is provided by this section is to that extent void.
(b) Except as otherwise prohibited by law, the following contracts are allowed to preserve a protectable interest:
(1) A contract between two or more persons or businesses or a person and a business limiting their ability to hire or employ
the agent, servant, or employees of a party to the contract is permitted where the agent, servant, or employee holds a position
uniquely essential to the management, organization, or service of the business.
(2) An agreement between two or more persons or businesses or a person and a business to limit commercial dealings to each
other.
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