An award of over $72,000 in fees and costs against a former employee was affirmed by the February 17 Colorado Court of Appeals decision, Saturn Systems v. Delbert J. Militare. The decision demonstrates the risks presented by a fee shifting provision in a noncompete agreement. After an employee had been terminated by Saturn, he used his relationship… Continue Reading
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Damages Awarded for Breach Prior to Modification of Non-compete Agreement
Posted in DamagesDamages may be awarded for breach of a non-compete agreement even if the agreement is modified after the breach occurs, according to the recent First Circuit decision in Astro-Med v. Nihon Kohden. In Astro-Med, the trial court modified the scope and range of the prohibited conduct set forth in the non-compete when it issued a preliminary injunction. Instead of… Continue Reading
Damages For Lost Profits Awarded
Posted in DamagesProfits lost on specific orders are recoverable for breach of a non-compete agreement, according to the recent Tenth Circuit decision in Southwest Stainless v. Sappington. Oklahoma law was applied to determine that the non-compete was enforceable. As a result, the trial court’s reasoning about why the non-compete was enforceable has limited value for a case… Continue Reading
Utah rules that damages for breach of a non-compete limited to lost profits
Posted in DamagesIn a November 2008 decision, TruGreen Companies v. Mower Brothers, the Utah Supreme Court ruled that lost profits is the appropriate measure of damages for breach of a contractual non-compete provision. In TrueGreen, TruGreen Companies had argued that an unjust enrichment or restitution measure of damages should be used. TruGreen sought to recover the economic… Continue Reading
Violating a Court Order barring competition
Posted in DamagesA recent decision from the Third Circuit illustrates the price an employee can pay for violating a temporary restraining order precluding competition with a former employer. In the fall of 2006, a federal district court in Pennsylvania granted the employer’s motion for a temporary restraining order pending a hearing on the employer’s motion for preliminary injunction.… Continue Reading