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Citing Nebraska’s fundamental public policy, the U.S. Court of Appeals for the Third Circuit recently affirmed a District Court’s refusal to enforce a Delaware choice of law clause in a non-compete agreement signed by a Nebraska employee.

Delaware law is generally favorable to enforcing non-compete restrictions.  Hundreds of thousands of new corporate entities (corporations, LLCs, LPs, LLCs, etc.) are created in Delaware every year, and the First State is home to more than two-thirds of the Fortune 500 and 80 percent of all firms that go public.[1] Many of these Delaware entities are headquartered in, and have operations in,…
Continue Reading Delaware Choice of Law Clause Unenforceable Against Nebraska Employee: A Cautionary Tale

When Massachusetts enacted the Massachusetts Noncompetition Agreement Act (“MNCA”) in mid-2018, some commentators suggested that the statute reflected an anti-employer tilt in public policy. But, we advised  that sophisticated employers advised by knowledgeable counsel could navigate the restrictions set forth in the MNCA.  As reported here, the May 2019 decision from the District of Massachusetts in Nuvasive Inc. v. Day and Richard, 19-cv-10800 (D. Mass. May 29, 2019) (Nuvasive I) supported our initial reading of the MNCA.   The First Circuit’s April 8, 2020 decision in Nuvasive, Inc. v. Day, No. 19-1611 (1st Cir. April 8, …
Continue Reading First Circuit: Massachusetts Employee Must Abide by a Restrictive Covenant Governed by a Delaware Choice of Law Clause – the More Things Change, the More They Stay the Same, Part II

When Massachusetts enacted the Massachusetts Noncompetition Agreement Act (“MNCA”) in mid-2018, many suggested then and thereafter that such statutes reflected an anti-employer tilt in public policy. But we advised at that time that the MNCA in fact appeared to present manageable options for sophisticated employers advised by knowledgeable counsel.   A recent federal court decision from the District of Massachusetts in Nuvasive Inc. v. Day and Richard, 19-cv-10800 (D. Mass. May 29, 2019), supports our earlier read, and belies the notion that Massachusetts courts see the Commonwealth’s policy requiring application of its own law to pre-existing non-competes.  So despite…
Continue Reading The More Things Change, the More They Stay the Same: Court Holds That All Those New Non-Compete Rules Under Massachusetts Act Do Not Supplant Old Public Policies Applicable to Pre-Existing Agreements