Frank worked for White Cow Milk For 20 Years; He Knew All of the Ladies in the Neighborhood Very Well. When Wawa Hired Him Away, Who Do You Think Mrs. Crabtree Wanted to Deliver Her Milk? |
If you have an Employment Agreement that includes Confidentiality, Non-Competition and Non-Solicitation covenants, and nevertheless go to work for a new company that competes with your former employer, you will likely be all right UNLESS you use Confidential Information misappropriated from your former employer prior to your departure and/or you solicit new business from clients you serviced while in your previous job.
Why is that?
Pennsylvania courts generally do not want to enforce non-compete agreements against Joe/Jane Average Employee simply because he/she is working for a competitor of his/her former employer.
Leave Your Employer's Confidential Information Behind |
Misappropriation and Solicitation Cast Dark Shadow on One's Character |
Rare |
Soooo good. And so Very Secret! |
Are My Former Employer's Customer Lists, Business Forms and Marketing Materials Trade Secrets Under Pennsylvania Law?
Generally the answer is NO.
In 2015, Pennsylvania's Superior Court issued a decision construing Pennsylvania's Uniform Trade Act, and held that "customer information, contracts and prices were not trade secrets....[because] competitor[s] could obtain the information be legitimate means."
However, you should not take any of your former materials (whether written or in digital format) with you when you leave the job, nor should you use any of them when you start your new job. Such Confidential Information is your employer's property, and misappropriation of same is a prescription for trouble.
That Midnight Download of Your Employer's Customer List Onto a Thumb drive Will Not Go Undetected |
If you do so and are found out, a court will deem you "untrustworthy" and will enforce your non-compete even if you are not soliciting customers of your former employer.
Indeed, if an ordinary employee has engaged in aggressive, subversive behavior that suggests the employee is intent upon "stealing" business from his/her former employer by any means necessary.
Indirectly = No Straw Parties |
Why? Well, the overwhelming majority of non-compete agreements contain non-solicitation clauses that prohibit the solicitation of former customers. And, while merely working for a competitor of your former employer is not going to cause them provable harm (no matter how wonderful you are), taking their customers will cause them provable financial harm and loss of good will. Courts will not countenance that, and your next stop will be a Preliminary Hearing wherein your former employer will seek to obtain a court Order prohibiting you from continuing on in your current business endeavor.
If evidence of misappropriation and use of Confidential Information coupled with solicitation of your former employer's customers surfaces at that Hearing, such an Order will usually follow.
So, our advice is, stay away from those former customers!
Suppose a Customer of My Old Company Contacts Me and Wants to Do Business With My New Company? Is That a Violation of My Non-Solicitation Agreement?
Yes, it is. There is simply no way around a non-solicitation agreement. Even if you can prove that the customer called you first, and said that it was going to stop doing business with your former employer, and wanted you to start handling its business, you will still be held to have violated your non-solicitation agreement. including the customer's choice.
Moreover, you cannot get around this problem by using a third-party, a straw person if you will, to solicit those former customers on your behalf. Almost all non-solicit agreements clauses say that you cannot "directly or indirectly" solicit former customers. Using a straw person is exactly what they mean by "indirectly."
Direct and Indirect Solicitation Prohibited |
What resources?, you ask. Compensation to employees, development of the product or service sold by the company, providing the sticks, bricks, inventory, equipment and machinery to outfit the company's office(s), marketing the company, paying for expenses associated with overhead, etc.
HERE
ARE SOME OTHER ARTICLES YOU MAY FIND WORTHWHILE:
Are Non-Compete Agreements
Enforceable in Pennsylvania? How Can I Negotiate a Non-Compete?
Non-Compete Agreements -
Legally Enforceable or Not, Negotiation is Often the Key
What State's Law Applies to My
Employment Contract? What is a Choice of Law Provision?
Recruiters and Non-Compete Agreements in
Pennsylvania
IT Consultants, Personnel Recruiters and
Non-Compete - Non- Solicitation Agreements in Pennsylvania
"Headhunters" and Non-Compete
Agreements in Pennsylvania - Some Things to Keep in Mind
Philadelphia, Pennsylvania Non-Compete Agreement Lawyers
Philadelphia Area Employment Attorneys Representing Employees
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