In Reed v. Getco, LLC, the Illinois Court of Appeals was recently faced with an interesting situation: under a contractual non-compete agreement, the employer was obligated to pay the employee $1 million during a six month, post-employment non-competition period. This was, in effect, a form of paid “garden leave” — where the employee was to be paid $1 million to sit out for six months – perhaps to finally correct his golf slice or even learn the fine art of surfing. It was a win-win situation that seemingly would be blessed by most courts; it was for a reasonable … Continue Reading
Illinois recently became one of the first states to ban non-compete agreements for low wage workers when it passed the Illinois Freedom to Work Act. The law, which takes effect on January 1, 2017 and applies to agreements signed after that date, bars non-compete agreements for workers who earn the greater of 1) the Federal, State, or local minimum wage or 2) $13.00 an hour. At present, because the State minimum wage is below $13.00 per hour, $13.00 an hour is the operative figure in Illinois.
While Illinois is one of the first states to enact this type of blanket … Continue Reading
On May 11, 2016, President Obama signed into law the Defend Trade Secrets Act (“DTSA”), which became effective immediately. The DTSA provides the first private federal cause of action for trade secret misappropriation, and it allows parties to sue in federal court for trade secret misappropriation—regardless of the dollar value of the trade secrets at issue.
Although the DTSA’s remedies largely overlap with those in the 48 states that have adopted some version of the Uniform Trade Secrets Act, the DTSA will nevertheless significantly alter how trade secret misappropriation cases are litigated. Additionally, the DTSA has broad whistleblower protections, and … Continue Reading
Employers seeking to require an existing employee to sign a restrictive covenant should consider current litigation trends surrounding what constitutes “adequate consideration.” Under the traditional rule followed by a majority of states, continued employment, standing alone, is adequate consideration for a restrictive covenant signed by an at-will employee. Several courts, however, have recently reexamined this issue, so employers must be aware of differences among the states as to whether some consideration beyond mere continued at-will employment is required.
Fifield v. Premier Dealer Services, Inc.
For example, the Illinois Appellate Court held in Fifield v. Premier Dealer Services, Inc.,… Continue Reading
In Bridgeview Bank Group v. Meyer, the Illinois Appellate Court recently affirmed the denial of a temporary restraining order (“TRO”) against an individual who joined a competitor and then, among other things, allegedly violated contractual non-solicitation and confidentiality obligations.
As a threshold matter, the Appellate Court was troubled by what it described as Bridgeview’s “leisurely approach” to seeking injunctive relief. The Appellate Court noted that Bridgeview filed the lawsuit three months after Meyer joined a competitor, waited two more weeks to file a motion for a TRO, and then did not notice its motion for a … Continue Reading
Readers of this blog know that long settled understandings regarding what constitutes adequate consideration for a restrictive covenant in Illinois were turned upside down when the First District Appellate Court in Illinois held in Fifield v. Premier Dealer Services Inc., 2013 IL App. (1st) 120327 that, absent other consideration, two years of employment are required for a restrictive covenant to be supported by adequate consideration, regardless of whether the covenant was signed at the outset of employment or after, and regardless of whether the employee quit or was fired.
The Illinois Supreme Court declined to hear Fifield, … Continue Reading
To register for this webinar, please click here.
This webinar will discuss recent developments and what to expect in the evolving legal landscape of trade secrets and non-competition agreements. With some businesses progressively feeling that their trade secrets are at risk for attack by competitors – and perhaps, by their own employees – this session will focus on how to navigate this developing area and effectively protect client relationships … Continue Reading
Peter A. Steinmeyer of Epstein Becker & Green, P.C. will be speaking in an upcoming live phone/web seminar entitled "Noncompete Agreements: Latest Litigation Developments" scheduled for Thursday, August 11, 1:00pm-2:30pm EDT.
As readers of this blog well know, employers frequently use noncompete agreements to protect confidential business information from misappropriation by departing employees. With continuing layoffs and business information easily accessible via computers and the Internet, enforceable noncompetes are critical in today’s economy.
Employment attorneys crafting noncompete agreements must avoid unreasonable and overbroad provisions. Courts are increasingly scrutinizing and, in some instances, refusing to enforce agreements that go … Continue Reading