As we discussed earlier this year, the U.S. Department of Justice (“DOJ”) in recent years has brought numerous criminal prosecutions against companies accused of engaging in so-called “naked” no-poach agreements, i.e., agreements among competing businesses to restrict hiring or compensation of employees, outside of any legitimate collaborative relationship. The DOJ’s efforts in this regard were spurred by the issuance in 2016 of Antitrust Guidance for Human Resources Professionals, which was a warning issued by the DOJ and the Federal Trade Commission ...
In the past month, the U.S. Department of Justice (DOJ) has made good on its 2016 threat, contained in its Antitrust Guidance for Human Resource Professionals (“Antitrust Guidance”) to bring criminal charges against people or corporations who enter into naked wage-fixing agreements or naked no-poach agreements. First, as reported here, on December 9, 2020, DOJ obtained an indictment against the president of a staffing company who allegedly violated Section 1 of the Sherman Act by conspiring with competitors to “fix wages” paid to physical therapists (PT) and physical ...
Thomson Reuters Practical Law published a Practice Note co-authored by Peter A. Steinmeyer and Robert D. Goldstein, Members of the Firm, “Hiring from a Competitor: Practical Tips to Minimize Litigation Risk.” This Practice Note discusses potential statutory and common law claims when hiring from a competitor, the need to identify any existing contractual restrictions a potential new hire may have, how to avoid potential issues during the recruitment process, ensuring the new hire is a “good leaver” during the resignation process, responding to cease ...
A recent decision from an Arkansas appellate court raises two important issues of enforceability of non-competition agreements: (1) the enforceability of a non-compete after expiration of the contractual non-compete period and (2) the applicable standard for determining whether a valid protectable interest exists.
In Bud Anderson Heating & Cooling, Inc. v. Neil, the plaintiff Bud Anderson Heating and Cooling, Inc. (“BAHC”), a HVAC vendor and service provider, appealed a lower court’s denial of BAHC’s petition for a one-year prospective injunction seeking to ...
Financial analytics firm Novantas, Inc. and two individual defendants closed out 2017 with a victory, securing the dismissal of claims by rival First Manhattan Consulting Group LLC (“First Manhattan Consulting Group”) [1], which accused them of competing unfairly by poaching First Manhattan Consulting Group’s employees in order to steal its trade secrets. The result demonstrates the need for plaintiffs in such cases to be able to prove with specificity which trade secrets were taken or threatened by the defendants’ conduct.
The Complaint alleged that Novantas engaged ...
California has always been a challenging jurisdiction for employers in terms of limiting unfair competition by former employees and protecting trade secrets. However, employers in the state can significantly enhance their ability to protect their business interests in these areas with a little planning and strategic thinking.
In this issue of Take 5, we look at some proactive steps that employers can take to prevent unfair competition by departed employees and protect trade secrets from misappropriation:
Blog Editors
Recent Updates
- Spilling Secrets Podcast: Can FTC’s Non-Compete Ban Survive Without Chevron Deference?
- Teeing-Up a Circuit Split on the FTC’s Noncompete Rule: Pennsylvania Judge Diametrically Opposes Earlier Decision by Texas Judge
- Pennsylvania Passes Law Limiting Use of Noncompetes for Health Care Practitioners
- Plaintiffs in Ryan Case Seek Nationwide Injunction of FTC Noncompete Rule; U.S. Chamber of Commerce Also Seeks Associational Standing
- Federal Court Denies Plaintiffs’ Motion for Reconsideration Seeking Expanded Scope of Injunction Staying the FTC’s Noncompete Rule