Restrictive Covenants & Trade Secrets

PDF
A key employee is leaving. How do you protect your business information? Early, proactive steps can help protect your information and keep your business running smoothly.

Overview

Your business is just that, your business. Your trade secrets – business intelligence, client lists, operational data – can easily walk out the door with an employee if he or she leaves for greener pastures. Protecting your business, and the time and resources you have dedicated to its success, should be a top priority. We can help you protect what you have built.

Our attorneys represent companies and related parties across the country in the pursuit or defense against employers who have violated restrictive covenants. We assist securities firms, financial institutions, health care and medical staffing companies, insurance companies, franchisees and franchisors, among others. We have litigated well over 300 restrictive covenant cases and have pursued and obtained injunctions in all U.S. contiguous states.

Restrictive Covenants. An Ounce of Prevention 

We can show you how to make your existing policies stronger and more enforceable – or, if you don’t yet have policies in place, we can craft them for you. We will formulate guidelines that will protect your business now and provide you with the necessary legal foundation should an issue arise in the future.

We can assist with drafting and instituting trade secret and data management policies that will provide your employees with a clear understanding of proper access, scope, and use of your business intelligence. Additionally, the use of restrictive covenants in employment contracts can provide clear instructions to and set necessary privacy expectations for your employees, making it clear that the business will not tolerate the misuse or theft of business intelligence.

Hiring and Recruiting

Are you hiring an employee who is subject to a restrictive covenant? While these agreements can protect your relationships and trade secrets, it is important to keep in mind the potential risks of bringing over employees from competitors who are subject to such agreements. 

Our attorneys can provide proactive advice to help avoid litigation and put you in a more favorable position if you (or your new employee) are sued. We help employers ask the right questions during recruiting in order to structure onboarding policies and practices to best protect their interests to avoid litigation or minimize exposure if litigation is looming.

We also advise on the importance of ensuring new employees do not – purposely or inadvertently – retain materials from a previous employer. This common occurrence can lead to costly lawsuits if proper precautions are not taken.

Temporary Restraining Orders (TROs) and Litigation

Employment relationships don’t last forever, and the stars you hired three years ago may be moving on. The departure is bad enough, yet when they leave and take business trade secrets with them, your response is critical and time is of the essence. Every day that goes by, your business could lose customers and your ability to recover damages diminishes.

If you wait to act, your former employee can point to that delay as proof that the situation was not urgent and that your claims are unsubstantiated.

Working quickly on your behalf, we can evaluate the situation or claim and make timely recommendations, sometimes using potential court action as leverage. The quick and accurate evaluation of your situation and associated claim is the key to moving forward successfully. 

Attorneys

Experience

Representative Matters

  • Emergency and other relief related to the misappropriation of trade secrets, the enforcement of restrictive covenants and unfair competition.
  • Defended individual financial advisors when sued by their former employers and counseled individual financial advisors as they contemplated joining a new firm.
  • In two different cases, obtained a temporary restraining order and permanent injunction on behalf of Enterprise Fleet Management against a departed employee. Enterprise Fleet Management, Inc. v. Guinn  2018 WL 7958815, E.D.Mo., Feb. 15, 2018. Enterprise Fleet Management, Inc. v. Polak, 4:18-cv-01187-AGF (2018).
  • Defended a large international manufacturer's representative in a trade secret case in the U.S. District Court for New Jersey. Although damaging evidence was uncovered during discovery, the case was settled on favorable terms for the client.
  • Enforced non-competition and non-solicitation clauses in an employment agreement against a physician who was terminated from a practice group. The court upheld both restrictive covenants.
  • Successfully defended a claim brought by an employer against an employee salesperson to enforce non-competition and non-solicitation clauses in an employment agreement. 

News & Insights

This website uses cookies to improve functionality and performance. If you choose to continue browsing this website, you consent to the use of cookies. Read our Privacy Policy here for details.