News & Analysis as of

Unenforceable Contract Terms Restrictive Covenants

Davidoff Hutcher & Citron LLP

Restrictive Covenants in Restaurant Ownership Agreements: Enforceability in New York

Restrictive covenants are critical in restaurant ownership agreements to protect business interests, prevent unfair competition, and safeguard proprietary information. However, in New York, courts scrutinize these clauses to...more

Mintz

[Podcast] Mintz On Air: Practical Policies – Disparage Me Not

Mintz on

Member Jen Rubin is joined by Member Natalie Groot for a practical conversation on non-disparagement clauses. This episode is part of a series of conversations designed to help employers navigate workplace changes and...more

Morris James LLP

Court of Chancery Finds Employee’s Restrictive Covenants Unenforceable for Lack of Consideration

Morris James LLP on

N. Am. Fire Ultimate Holdings, LP v. Doorly, C.A. No. 2024-0023-KSJM (Del. Ch. Mar. 7, 2025) - A contract requires consideration to be enforceable. In this case, the Court of Chancery held restrictive covenants were...more

Troutman Pepper Locke

Delaware Court of Chancery Invalidates Noncompete Provision Found in Typical Sponsor Equity Documents

Troutman Pepper Locke on

In Weil Holdings II, LLC, v. Jeffrey Alexander, DPM, the Delaware Court of Chancery struck down a noncompete provision contained in the LLC agreement of a sponsor-backed portfolio company, finding the provision unreasonable...more

Ropes & Gray LLP

[Podcast] Navigating Non-Competes and Other Exclusivity Provisions in Collaboration & License Agreements and Other Strategic...

Ropes & Gray LLP on

On this Ropes & Gray podcast, licensing and collaboration partner Hannah England and antitrust partner Lisa Kaltenbrunner discuss how EU antitrust rules impact non-competes and other exclusivity provisions in collaboration...more

Troutman Pepper Locke

Restrictive Covenants Unenforceable Where Consideration Forfeited

Troutman Pepper Locke on

In North American Fire Ultimate Holdings, LP v. Alan Doorly, the Delaware Court of Chancery held that the restrictive covenants included in an incentive unit grant agreement were unenforceable when the units received by the...more

Jenner & Block

Delaware Supreme Court Reaffirms Reluctance to Blue-Pencil Overbroad Restrictive Covenants in Sunder v. Jackson

Jenner & Block on

The Delaware Supreme Court’s decision in Sunder Energy, LLV v. Jackson, No. 455, 2023, 2024 Del. LEXIS 407 (December 10, 2024) reaffirmed the courts’ limited willingness to modify or “blue-pencil” overbroad restrictive...more

WilmerHale

Beating the Odds: First Circuit Doubles Down on Massachusetts Decision Enforcing Noncompete Against Sports Betting Executive Newly...

WilmerHale on

Against a growing trend of legislation and broader efforts seeking to limit or eliminate post-employment noncompetition restrictions, recent Massachusetts and First Circuit decisions in a dispute between DraftKings and one of...more

Morrison & Foerster LLP

Kodiak Two Years Later: Is Delaware’s Blue Pencil Turning Red for Non-Competes?

October 6, 2024 marks the two-year anniversary of Kodiak Building Partners, LLC v. Adams—the case in which the Delaware Chancery Court refused to enforce a sale-of-business non-compete against an executive who received $1...more

Tucker Arensberg, P.C.

An Update on the Uncertain Future of the FTC’s Non-Compete Rule, Plus Pennsylvania Enacts New Non-Compete Law for Healthcare...

Tucker Arensberg, P.C. on

Since it was first published in April, the fate of the Federal Trade Commission’s (FTC) final non-compete rule has been, to put it mildly, less than certain. Now, about a month before the rule is scheduled to take effect, the...more

Lathrop GPM

FTC Approves Final Rule, Would Ban Most Employment Non-compete Agreements

Lathrop GPM on

The Federal Trade Commission (“FTC”) voted and approved the issuance of a final rule, the Non-Compete Clause Rule, that, if it goes into effect, will make future employment non-compete agreements unenforceable and will...more

Tucker Arensberg, P.C.

FTC Votes to Ban Non-Compete Agreements

Tucker Arensberg, P.C. on

In a Special Open Commission Meeting, the Federal Trade Commission voted to approve the final rule to ban non-compete agreements for for-profit businesses, the effective date of such ban being in 120-days....more

Epstein Becker & Green

Red Pencil, Blue Pencil, or Something In Between? Ohio Court of Appeals Declines to Modify Overbroad Non-Competition Agreement

Epstein Becker & Green on

Ohio has long recognized the enforceability of non-compete agreements. Broadly speaking, a court can do one of three things with an unenforceable non-compete agreement: (1) the court can apply the “red pencil” doctrine and...more

Parker Poe Adams & Bernstein LLP

New California Law Requires Notice to Employees About Void Noncompetes

Most employers know that California has for decades prevented enforcement of employee non-competition and customer non-solicitation agreements. Some companies with California operations modify their agreements with employees...more

Holland & Knight LLP

Florida Legislature Proposes Ban on Physician Noncompete Agreements

Holland & Knight LLP on

The Florida Legislature is currently considering two bills that, if enacted in their current form, would significantly reduce (and potentially eliminate altogether) the enforceability of noncompete agreements against...more

Littler

Delaware Supreme Court Upholds Forfeiture for Competition Provisions, Holding Departed Partners Bargained Away Their Right to Have...

Littler on

On January 29, 2024, the Delaware Supreme Court unanimously reversed a major Delaware Chancery Court decision that had analyzed the “forfeiture for competition” provisions in a limited partnership agreement using a...more

Holland & Knight LLP

California's New Nationwide Focus on Noncompetition Agreements

Holland & Knight LLP on

For decades, California has taken arguably the most pro-employee-mobility position on noncompetition and non-solicitation agreements in the country – generally, post-employment noncompetition and non-solicitation agreements...more

Fisher Phillips

Georgia Employers Must Act Now as Recent Court Decision Potentially Invalidates Most Employee Non-Solicitation Covenants

Fisher Phillips on

The Georgia Court of Appeals just made it significantly more difficult for employers to enforce employee non-solicitation provisions, which might require you to take immediate action to protect your company’s interests in...more

Ogletree, Deakins, Nash, Smoak & Stewart,...

Louisiana Court Rules Restrictive Covenant Is Unenforceable and Can’t Be Saved by Reformation

Louisiana regulates noncompete agreements by statute. The statute declares that a noncompete is invalid unless the agreement complies with at least one of several exceptions based on the type of relationship. ...more

Sands Anderson PC

Federal Trade Commission Extends Public Comment Period for Proposed Rule Banning Employee Non-Competition Clauses

Sands Anderson PC on

Earlier this month, the Federal Trade Commission (FTC) voted 4-0 to extend its March 20th deadline for public comments on its controversial proposed rule to ban employee non-competition clauses (non-competes). The Commission...more

Ogletree, Deakins, Nash, Smoak & Stewart,...

California Bill Would Impose Penalties on Employers and Attorneys for Attempting to Enforce Restrictive Covenants

In February 2023, new legislation was proposed in the California State Assembly that, if adopted and signed into law by Governor Gavin Newsom, could have a significant impact on employers and their attorneys providing advice...more

Kaufman & Canoles

FTC Looks to Ban Non-Competes, But Don’t Panic

Kaufman & Canoles on

The Federal Trade Commission (FTC) rang in 2023 by zeroing in on a new target: non-competes. On January 5, the FTC announced a new proposed rule banning the use of non-compete provisions in agreements with individuals....more

Dorsey & Whitney LLP

FTC Takes First Step to Make Good on Promise to Curtail Non-Compete Agreements

Dorsey & Whitney LLP on

On January 5, 2023 the Federal Trade Commission (“FTC”) proposed a rule to ban most non-compete agreements (“non-competes”) for American workers. The text of the proposed rule is broad: provisions that prevent workers from...more

Nutter McClennen & Fish LLP

FTC Proposes New Rule Banning Non-Compete Agreements

On January 5, 2023, the Federal Trade Commission (“FTC”) proposed a new rule which would effectively ban all non-compete agreements between employers and “workers” (defined under the rule to include employees, independent...more

Holland & Knight LLP

FTC Moves to Ban Non-Competes: What Employers Need to Know Now

Holland & Knight LLP on

The Federal Trade Commission (FTC) proposed a rule on Jan. 5, 2023, prohibiting non-competition clauses ("non-competes") in employment agreements. For purposes of the rule, non-compete provisions include explicit and de facto...more

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