Recent Blog Posts
- Long Strange Trip Through Court System Continues in Goldman Code Theft Case In an order dated April 20, 2017, New York’s Court of Appeals agreed to hear Sergey Aleynikov’s appeal of his conviction under an arcane New York criminal statute.
Aleynikov is a former Goldman Sachs computer programmer, arrested in July 2009 and accused of stealing computer source code from the bank. Originally, a federal jury found him guilty of violating both the National Stolen Property Act and the Economic Espionage Act, but that verdict was overturned by the Second Circuit in April 2012... More
- Going All the Way: SDNY Jury Awards $14.5 Million in Trade Secrets Lawsuit
It is rare that a trade secret / restrictive covenant lawsuit makes it all the way to trial, much less a jury verdict. The passage of time, accumulating legal expenses, bad facts, and/or the risk of losing at trial all can conspire to sap litigants of the desire to take their cases to the finish line. Settlements and withdrawals of claims abound. Sometimes, however, the parties dig in and roll the dice in court, as recently occurred in a case... More
- White House Call to Action Could Spur More States, Including New York, to Act Against Non-Competes Political winds disfavoring non-compete agreements for low wage and rank-and-file workers continue to blow, and appear to be picking up speed.
On October 25, 2016, the White House took the unusual step of issuing a “Call to Action” to states regarding non-compete agreements, as part of the President’s initiative to stoke competition across the economy. Calling non-competes an “institutional factor that has the potential to hold back wages and entrepreneurship,” the Call to Action seeks to reduce the misuse of non-compete... More
- New York Attorney General Targets Non-Competes for Rank-and-File Workers This summer, New York Attorney General Eric T. Schneiderman has reached agreements with a number of companies curtailing their use of non-competition agreements with respect to non-executive and low-wage employees in New York. The issue appears to have caught the attention of Mr. Schneiderman, who stated recently that “restricting rank-and-file workers from being able to find other jobs is unjust and inappropriate” and “workers should be able to change jobs without fear of being sued.”
For example, on August 4, 2016,... More
- Connecticut and Rhode Island Enact Statutes Restricting Physician Non-Competes David J. Clark
Last month, two New England states enacted laws restricting the use of non-competition provisions in agreements governing an employment, partnership or other professional relationship of a physician.
Broadly speaking, the aim of both of these laws is to protect patients’ choice regarding medical care by limiting the ability of employers or partners to contract with physicians such that the physicians’ ability to practice medicine would be restricted at the end of the professional relationship.
Effective on July 12, 2016, the... More
- No New Non-Compete Law for Massachusetts in 2016 David J. Clark
The Massachusetts legislature ended its 2015-2106 session on July 31, 2016, and lawmakers did not pass new legislation regarding non-compete agreements before doing so.
For the last few years, numerous efforts have been made in the Commonwealth to limit the use of non-compete agreements, resulting in several bills introduced in the Statehouse. The latest bills, introduced in the House in June and the Senate in mid-July, would have set clear boundaries on the use of non-compete agreements by employers,... More
- Defend Trade Secrets Act Signed Into Law 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... More
- House Passes Federal Trade Secrets Bill After years of stops and starts in Congressional efforts to pass a law creating a federal claim for misappropriation of trade secrets that can be pursued by private citizens and companies (as opposed to federal prosecutors), the last few weeks have produced an astonishing acceleration of those efforts. This month, the Defend Trade Secrets Act has been approved by both houses of Congress in resounding fashion. It is on the brink of being enacted into law.
On April 27, 2016, the... More
- Federal Trade Secrets Bill Clears Important Hurdle Last week, the Senate version of the Defend Trade Secrets Act (S. 1890) was passed with bipartisan support by the Senate Judiciary Committee. As we have previously discussed on this blog, the bill is aimed at addressing alleged inadequacies in U.S. law through the creation of a federal private right of action for trade secret misappropriation. The legislation would also provide injunctions to preserve evidence and prevent disclosure, and damages to account for economic harm to plaintiffs whose trade secrets... More
- Non-compete Distance Measured as The “Crow Flies” A recent case out of Ohio offers an instructive lesson for those looking to probe the geographical limits of a non-compete agreement. A dentist sold his dental practice and also continued to work as an employee there. As part of the sale, he agreed not to compete for five years and was prohibited from working “within 30 miles” of the practice. The relationship between the parties deteriorated and the dentist went to work for a competing firm. The purchaser dentist... More