Non-Disclosure/Non-Compete Agreements

At Roth Law Group, we have experience prosecuting and defending actions involving non-disclosure and non-compete agreements. These types of restrictions usually arise in the context of employment agreements and business purchase or sale agreements. They can be extremely useful in protecting businesses because they prevent employees from poaching customers upon the conclusion of their employment relationship.

The geographic limit and duration of the restriction is important as they need to be reasonable, especially when it comes to non-compete agreements. That is to say, you could never limit someone from ever working in their profession again in the event they leave your employ. We commonly see limitations of three to five years in which an employee may not go after your customers, suppliers or try to hire away your employees.

Non-disclosure agreements are generally better received by courts, especially when trade secrets are involved. Circumstances exist in which employees or other parties receiving trade secrets must agree to never disclose that information forever.

One of the most important considerations is that a non-disclosure, non-compete or non-solicit must be consented to prior to disclosure or hiring. Courts have been reluctant to uphold such agreements in the case of an employee relationship due to lack of consideration.

The argument against enforcement is that the person already has a job, what are they getting for being restricted as to where they can work if they are terminated? With that said, you can still get an effective agreement in the event you provide new consideration in exchange for the employee or receiving party agreeing to the restriction.