An employer seeking to enforce an assigned non-compete must demonstate that the non-compete was assigned
As the previous entry suggested, an employer in Colorado may be able to enforce an assigned non-compete under the proper circumstances.
In a recent case, however, an employee argued that the evidence was insufficient to find that his non-compete had actually been assigned. A transfer agreement had been signed which provided that the employee's former employer would sell , transfer and assign all of the property listed on "Schedule 1", but Schedule 1 apparently was left blank. Neither the employment agreements, nor anything else was listed.
Despite this problem, the trial court found that the parties had the "requisite intent" to effect an assignment of the employment agreements with the non-competes. At trial, there was testimony that the only reason that the transfer agreement was left blank was because the "lawyers and accountants in charge of completing the form failed to do so before closing".
There is a practical lesson to be learned from this decision. Just because something can be done doesn't mean that it has been done. Any employer seeking to enforce an assigned non-compete must confirm that the non-compete has been assigned. Any employee resisting enforcement of an assigned non-compete must see and understand the assignment.
