Trade Secrets & Employee Mobility

The District of Columbia is bracing for a transition.  But while employers across the country wait to see what changes the Biden Administration may bring, Washington, D.C. employers should prepare for a drastic and imminent change in their own backyard.

As we previously reported, last month the District of Columbia Council passed the Ban on Non-Compete Agreements Amendment Act of 2020 (D.C. Act 23-563) (the “Act”).  On January 11, 2021, Mayor Bowser signed the legislation. It will now be sent to Congress for the congressional review period set forth by the Home Rule Act.  Absent ...

Our colleagues Peter Steinmeyer and Brian Spang have co-authored an article in Law360, titled “Trade Secrets Law 25 Years After PepsiCo Disclosure Case.” (Read the full version – subscription required.)

Following is an excerpt:

Twenty-five years ago, the U.S. Court of Appeals for the Seventh Circuit issued what many at the time perceived as a landmark decision, PepsiCo Inc. v. Redmond, in which the court applied the concept of inevitable disclosure of trade secrets to affirm an injunction prohibiting a senior executive from taking a similar position at a direct ...

We're pleased to share the 2021 update of “Non-Compete Laws: Connecticut,” a Q&A guide published by Thomson Reuters Practical Law.

Following is an excerpt (see below to download the full version in PDF format):

This Q&A addresses enforcement and drafting considerations for restrictive covenants such as post-employment covenants not to compete and non-solicitation of customers and employees. Federal, local, or municipal law may impose additional or different requirements. …

In particular, this Q&A addresses:

• • Overview of State Non-Compete Law
  • Enforcement ...

Thomson Reuters Practical Law has released the 2021 update to “Preparing for Non-Compete Litigation,” a Practice Note I co-authored with Zachary Jackson.

See below to download the full Note – following is an excerpt:

Non-compete litigation is typically fast-paced and expensive. An employer must act quickly when it suspects that an employee or former employee is violating a noncompete agreement (also referred to as a non-competition agreement or non-compete). It is critical to confirm that there is sufficient factual and legal support before initiating legal action ...

Earlier this month, the U.S. Department of Justice (“DOJ”) announced that a federal grand jury in Texas indicted Neeraj Jindal, the former owner of a physical therapist staffing company, in connection with an illegal wage-fixing conspiracy to depress pay rates for physical therapists (“PTs”) and physical therapist assistants (“PTAs”) who travel to patients’ homes or assisted living facilities in the greater Dallas-Fort Worth area.  The indictment was something of a landmark for the U.S. Department of Justice (“DOJ”), which for years had promised that such ...

Non-compete agreements may all but disappear from the Washington, D.C. employment landscape in 2021.  On December 15, 2020, the District of Columbia Council voted 12-0 to approve the Ban on Non-Compete Agreements Amendment Act of 2020 (B23-0494) (the “Bill”), which would prohibit the use and enforcement of non-compete agreements for all employees except certain highly paid physicians.  If enacted into law, Washington, D.C. will have adopted a much stricter policy than several other states  that have recently restricted the use of non-compete agreements—including its ...

In a case with significant ramifications for employers concerned with protecting sensitive information, and for employees accused of abusing access to computer networks, the United States Supreme Court (“SCOTUS”) heard oral argument this week in Van Buren v. United States, No. 19-783, a case from the Court of Appeals for the Eleventh Circuit that will require interpretation of the Computer Fraud and Abuse Act (“CFAA”), 18 U.S.C. § 1030.  The argument was lively.  All of the Justices asked questions, and several expressed concern about vagueness in the CFAA’s definition ...

The Court of Appeals for the Sixth Appellate District of Texas at Texarkana issued an opinion on November 24, 2020 in Titan Oil & Gas Consultants LLC v. David W. Willis and RIGUP, Inc., a case addressing application of a non-competition provision in the independent contractor context in the oil and gas drilling and production industry in the Permian Basin and elsewhere. Titan addressed non-competition claims of interest both to those focused on the Texas arcana of the state’s restrictive covenant statute and jurisprudence and to those more generally interested in applying ...

The 2020 update to our Practice Note, “Garden Leave Provisions in Employment Agreements,” is now available from Thomson Reuters Practical Law.  We discuss garden leave provisions in employment agreements as an alternative or a companion to traditional employee non-compete agreements.

Following is an excerpt (see below to download the full article in PDF format):

In recent years, traditional non-compete agreements have faced increasing judicial scrutiny, with courts focusing on issues such as the adequacy of consideration, the propriety of non-competes for lower level ...

In Payward, Inc. v. Runyon, Case No. 20-cv-02130-MMC, the United States District Court for the Northern District of California granted a Rule 12(b)(6) motion, ruling that information alleged to be “secret” failed to qualify as a “trade secret” under the Defend Trade Secrets Act.  The Court applied California and federal precedent explaining trade secret information confers a competitive business advantage, and found the complaint lacked any such allegations.  The decision make sense given the particular allegations in the case.  But does a “competitive business ...