Non-competes, Unfair Competition and Trade Secrets

Employee departures can be painful and costly to a business. Without the proper employment agreements in place, a former employee may open a competing business, solicit clients, disclose confidential information, recruit employees and/or misappropriate key competitive assets.

On the other side, employers in many competitive industries may wish to hire employees with industry knowledge who have worked with their competitors, but wish to avoid becoming embroiled in litigation over a candidate’s prior restrictions.

Saul Ewing’s Labor, Employment and Employee Benefits Practice Group includes a team of lawyers with substantial experience nationwide in the law of employee defection and recruitment.

Litigation: Injunctions and Damages

Our Non-competes, Unfair Competition and Trade Secrets attorneys are seasoned trial lawyers, regularly appearing in state and federal courts across the country, as well as before arbitration forums such as the AAA, NASD, and NYSE. We enforce on behalf of companies whose employees have defected and defend companies that have recruited employees, and are asked by employers to defend themselves or their new employees against claims brought by a former employer. The cases handled by our attorneys routinely involve applications for temporary restraining orders and preliminary injunctions, in addition to permanent injunctive relief and damages claims under common law and statutory theories, such as breach of contract, tortious interference, breach of the duty of loyalty, violation of the Computer Fraud & Abuse Act, and business conspiracy.

When your business has just learned that a key employee or group has jumped to a competitor, you need lawyers who can immediately help you identify and secure crucial evidence, analyze the strengths and weaknesses of your claims, and weigh options. Sometimes the threat of litigation can achieve results, but only when your lawyers are prepared to go to court. Saul Ewing lawyers routinely prepare and try these cases. When you receive such a demand from a competitor, and need advice in a response or defense of an action that is not warranted, Saul Ewing lawyers can help.

Planning and Counseling: Drafting Agreements and Setting Policy

We understand that litigation is the option of last resort, and that prevention is better. Many employee defection and recruitment cases turn not on what the employee did, but the policies and agreements of the former employer. In addition to our litigation experience, our attorneys help corporate Boards, senior management, in-house counsel and human resources professionals develop and implement coordinated programs to protect competitive assets against employee defection, and to minimize the risks that arise when hiring employees from competitors. This includes helping employers at the level of setting policy, during the hiring process, on termination, and when they learn of a potential threat. We assist clients in:

• Drafting effective restrictive covenant agreements such as non-compete, non-solicitation, and confidentiality agreements;
• Developing policies and procedures, as well as standard contract provisions, to address trade secrets, ownership of intellectual property, fiduciary duty, duty of loyalty, unfair competition, and IT policies and practices;
• Negotiating executive and other contracts where restrictions are tailored to the position, duties and location of the employee;
• Understanding and addressing statutory concerns such as the Computer Fraud & Abuse Act, the Economic Espionage Act, and similar state statutes;
• Implementing restrictive covenants in a multi-state environment;
• Assisting in employee terminations, including negotiation of severance arrangements;
• Developing and implementing effective Alternative Dispute Resolution (ADR) policies to quickly and efficiently resolve the types of issues that commonly arise with departing employees.

When your business is recruiting employees, you want to make certain that they are not going to bring a lawsuit with them. We help employers in reviewing the agreements and restrictions on incoming employees; drafting employment agreements to reduce the risk of a claim by a former employer; and advising clients on options when a former employer sues you or your employees.

Experience Across Industry Sectors

We have represented clients in a wide variety of industries, including:

• Government contracting
• Financial and securities companies
• Computer consulting and services, hardware/software sales and distribution
• Information technology sales, services, and consulting
• Professional services (law, medicine, accounting, dentistry, A/E firms) practices
• Personnel placement, recruiting, permanent and temporary staffing
• Manufacturing
• Retail