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Non-competes and non-solicits

post #1 of 21
3/22/11 at 8:54pm
Thread Starter 
As I understand it, in the US and in Canada as well, non-competes are difficult or impossible to enforce. How about non-solicits? For me my contacts are my lifeblood. To be asked not to hit my list after I leave a company is akin to asking me not to do what I do. Do I argue this to a new employer during negotiations, justifying my position by saying that it's what I do, or do I just sign and hope they never try to pursue me after our relationship ends and I break the agreement?
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post #2 of 21
3/22/11 at 8:59pm
what do you do?
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post #3 of 21
3/22/11 at 9:00pm
Quote:
Originally Posted by unjung View Post
As I understand it, in the US and in Canada as well, non-competes are difficult or impossible to enforce. How about non-solicits? For me my contacts are my lifeblood. To be asked not to hit my list after I leave a company is akin to asking me not to do what I do. As such, it seems that it would be difficult to defend a non-solicit as well, given that it prevents me from working. Do I argue this to a new employer, justifying my position by saying that it's what I do, or do I just sign and hope they never try to pursue me after our relationship ends and I break the agreement?

In my experience, non-solicits tend to be a bit more enforceable than non-competes. Non-competes are enforceable on a state-by-state basis, depending on the nature of the departure from the company.

Non-solicits are much easier to enforce because if you're going after your former company's clients, you're almost always going to be using that company's confidential information / trade secrets. There are probably industries and dynamics where this is less the case, but I've certainly seen non-competes thrown out with the non-solicitation left intact.
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post #4 of 21
3/22/11 at 9:01pm
In some states, non-competes are enforced as long as they are reasonable. The rule of thumb in at least one state is 2 years and a certain number of miles away depending upon the industry.

Under Canadian law, non-competes will be enforced if Hiahassee the Bird Goddess sheds her sorrow tears and mourns for womankind.
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post #5 of 21
3/22/11 at 9:01pm
Thread Starter 
I wholesale securities. However, I work within a very specific niche. The financial industry in Canada is already small and I work in a very specific area. Everyone knows everyone, if not personally, by name.
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post #6 of 21
3/22/11 at 9:03pm
You could try to hammer out an agreement exempting the contacts you already have when you start with them.
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post #7 of 21
3/22/11 at 9:05pm
Quote:
Originally Posted by unjung View Post
I wholesale securities. However, I work within a very specific niche. The financial industry in Canada is already small and I work in a very specific area. Everyone knows everyone, if not personally, by name.

This is not going to be a binary Yes/No analysis. An attorney (or shaman) who practices employment law on a daily basis should be able to help. A few hundred Canadian pesos is money well spent when its your livelihood at stake!
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post #8 of 21
3/22/11 at 9:05pm
Quote:
Originally Posted by tj100 View Post
Non-competes are enforceable on a state-by-state basis, depending on the nature of the departure from the company.
My wife is coming to the end of a 6-month non-compete, so they are enforceable in NY. But she didn't have to sign one at her new gig in CA. I recently parted ways with a Canadian company I was repping in the US and I told them that the US clients were mine. lefty
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post #9 of 21
3/22/11 at 9:14pm
A cheaper way of getting a thumbnail answer is to search the many blogs on Canada employment law, particularly in your colony.
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post #10 of 21
3/22/11 at 9:17pm
Quote:
Originally Posted by lefty View Post
My wife is coming to the end of a 6-month non-compete, so they are enforceable in NY. But she didn't have to sign one at her new gig in CA.

They're illegal in CA. Assuming she knew she was going to CA, she could have started right away without sitting it out (though it would have taken some legal maneuvering) - but a 6 month vacation isn't the end of the world...
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post #11 of 21
3/22/11 at 10:01pm
Quote:
Originally Posted by lawyerdad View Post
You could try to hammer out an agreement exempting the contacts you already have when you start with them.

+1. Often, employment agreements may contain some type of confidential information provision, which broadly defines confidential information to include things like customer lists, etc. However, such provisions should also include the "standard" exclusions to confidential information, such as information you already knew, information that was in the public, etc.
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post #12 of 21
3/22/11 at 10:58pm
Quote:
Originally Posted by tj100 View Post
They're illegal in CA. Assuming she knew she was going to CA, she could have started right away without sitting it out (though it would have taken some legal maneuvering) - but a 6 month vacation isn't the end of the world...

CA company never pushed her to break it and the NY company would have fought hard to hold her to it. 6 month paid vacation. Idiotic on CA's part. Makes her very attractive to be grabbed by a new company.

lefty
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post #13 of 21
3/23/11 at 12:00am
Quote:
Originally Posted by tj100 View Post
They're illegal in CA. Assuming she knew she was going to CA, she could have started right away without sitting it out (though it would have taken some legal maneuvering) - but a 6 month vacation isn't the end of the world...

Quote:
Originally Posted by lefty View Post
CA company never pushed her to break it and the NY company would have fought hard to hold her to it. 6 month paid vacation. Idiotic on CA's part. Makes her very attractive to be grabbed by a new company.

lefty

I thought they were unenforcable in CA rather than illegal per se. I was under the impression that if the company continued to pay you after you left the company it was enforceable
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post #14 of 21
3/23/11 at 12:26am
Maybe. I don't know. But she wasn't asked to sign one so no NC.

lefty
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post #15 of 21
3/23/11 at 1:06pm
Thread Starter 
I've checked some legal blogs and did find some interesting stuff. If I really want a sound opinion I'm going to have to get professional advice, both on the contract I have with the company I'm leaving next week, and on the topic of what my next contract should contain, with the company I'm going to.
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