Several states over the past few years have passed legislation prohibiting the use in noncompete agreements (and other employment-related agreements) of out-of-state choice-of-law and forum selection provisions. A few of these states’ laws include enforcement mechanisms with stringent penalties, such as California, which provides for injunctive relief and attorneys’ fees to an aggrieved employee; Washington, which entitles aggrieved employees to actual damages or statutory penalties of $5,000, as well as their attorneys’ fees; and, beginning in August, Colorado, where any violation of that state’s noncompete statute (including the prohibition on out-of-state choice-of-law and forum selection provisions) could lead to civil and criminal penalties.
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 ...
Recent Updates
- New York Proposes Bill Aimed at Prohibiting Noncompetes for Healthcare Workers
- No Free Pass in Mass: Massachusetts Supreme Judicial Court Says Irreparable Harm Must Be Proven, Not Presumed, in Trade Secret Cases
- New York Federal Court Enforces Non-Compete Against Employee Terminated for Cause
- Louisiana, Maryland, and Iowa Pass Laws Restricting Noncompetes Specific to Certain Professions
- Delaware Refuses to Blue Pencil Overbroad Restrictive Covenants Following Business Acquisition