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Non-Compete & Trade Secrets

Contacts

S. Preston Ricardo
Partner
Alexander W. Leonard
Partner
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We have a nationwide practice that focuses on helping companies and individuals across a broad array of industries to protect their human and intellectual capital

Our Non-Compete & Trade Secrets practice counsels companies and individuals about the legal issues surrounding post-employment restrictive covenants and trade secrets when individuals or groups of individuals move from one employer to a competitor.  We help our clients nationwide, across all industries, to develop protective policies, procedures and agreements, to identify and minimize the risks of litigation from a contractual and data perspective when hiring new personnel, and to protect their human and intellectual capital when employees leave.    

When one of our clients loses a key employee, we quickly strategize with our clients to assess any faithless pre-departure conduct, communicate with the former employees and his or her new employers about any contractual restrictions that prohibit the former employee from engaging in certain post-employment conduct, determine whether any trade secret or confidential information has been compromised, and, when necessary, take aggressive legal action to protect our clients’ competitive interests, including through temporary restraining orders, preliminary injunctions, and expedited discovery.

When representing new employers and/or departing employees, we advise our clients on best practices for making the transition in a way that satisfies the employees’ fiduciary and contractual obligations.  To do so, we carefully evaluate the enforceability of any restrictions that purport to prohibit the employee from soliciting clients or employees, performing services for clients, accepting business from clients, and conducting a specified type of work.  We also regularly help our clients navigate the complexities of returning electronic data that belongs to the former employer, including through coordination with forensic firms.  On behalf of clients who have been accused of breaching or interfering with restrictive covenants, engaging in or aiding faithless conduct, or misappropriating trade secrets, we have obtained numerous favorable outcomes, including by defeating applications for injunctive and dispositive relief, working extensively with expert witnesses to disprove damages theories, and obtaining a defense verdict in federal court after our client was accused of stealing a manufacturing process.

Because of the firm’s close work with many financial institutions and brokerage firms, we often represent our clients in arbitrations and other alternative dispute proceedings to resolve employment disputes.

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Case Study

Non-Compete & Trade Secrets

Non-Compete Claims

As part of its strategy to enter a new geographical market, our client, one of the world’s largest insurance brokers, hired a group of employees in that market from another of the world’s largest insurance brokers.

The Situation

As part of its strategy to enter a new geographical market, our client, one of the world’s largest insurance brokers, hired a group of employees in that market from another of the world’s largest insurance brokers.  One of the new hires became the President of our client’s affiliate in that market.  Shortly thereafter, the former employer initiated an action in Michigan state court against our brokerage client and its affiliate’s President, whom we also represented.  Plaintiff alleged that the new President misappropriated confidential information and was soliciting plaintiff’s clients and employees in breach of her employment agreement’s restrictive covenants, allegedly with her new employer’s encouragement and assistance.

Months later, during the course of discovery, two of plaintiff’s corporate clients transferred their health and benefits insurance business from plaintiff to our brokerage client.  Plaintiff filed an emergency motion for a Temporary Restraining Order and Preliminary Injunction.  In its motion, plaintiff sought to enjoin our clients not only from soliciting, accepting, and servicing business from plaintiff’s current or prospective clients, but also from servicing the two clients that had already moved their business.

The Solution

In the span of a little more than a week, the GEABP team drafted a 20-page opposition brief and secured three supporting affidavits, two of which were provided by the non-parties who had transferred their business from plaintiff to our brokerage client.  When plaintiff submitted an untimely and improper reply brief less than 48 hours before the hearing, we – less than 24 hours later – submitted opposition in response to that brief as well.

The Result

The preliminary injunction hearing was held remotely via Zoom.  After hearing oral argument, the judge gave his ruling from the bench, adopting all of our key arguments and denying plaintiff’s motion for injunctive relief in its entirety.  The case settled shortly thereafter.