The current trend in the world of noncompete litigation in Massachusetts is away from the enforcement of traditional noncompetes — as distinguished from non-solicitation and non-disclosure provisions. Massachusetts judges seem to be increasingly skeptical of traditional noncompete provisions in contexts other than very senior, highly-paid employees going to work for direct competitors. So, when a decision like Eastern Bag & Paper Co., Inc. v. Ross, is issued, one can’t help but take notice. In this case, Superior Court Judge Dennis J. Curran (a 2006 Romney appointee) issued a preliminary injunction and enforced a noncompete by its terms against a sales employee. In addressing the defendant’s arguments against enforcement, Judge Curran wrote the following:
These are not mere words. They are express contract terms. Mr. Ross, over the age of 18 and of capacity, freely signed a document committing himself to them. He later reaffirmed them. He took $5,000 to abide by them; he later re-affirmed them so he could keep the $5,000. The defendant’s present attack on this contract is simply unavailing; indeed, it reminds one of the expression:
A deal is a deal only until something better comes along
Strong words! In enforcing the non-compete, the judge was influenced by a number of factors, including the relatively generous financial package being earned by the defendant (exceeding six figures); the limited geographical scope of the non-compete (one county in New Hampshire, four counties in Massachusetts and the state of Rhode Island); the fact that as a territory manager, the defendant was responsible for sales strategy and had extensive customer contact; and the fact that the employee reaffirmed the noncompete and received some cash consideration (although only $5,000) when he departed. In addition, it should be noted that the court was applying Connecticut, rather than Massachusetts law, although the substantive standard of enforceability articulated by the court was identical to the Massachusetts standard.
The decision ultimately seems to underscore one of the fundamental variables in play in this area: whether or not a noncompete will be enforced depends very much on the facts of the case and the particular judge deciding it.
Here are some useful documents:
- Ten tips for hiring without getting sued, MASS HIGH TECH (with Sheila O’Leary) (February 2, 2007)
- Avoiding Legal Risks As You Expand Your Head Count, BOSTON BUSINESS JOURNAL (with Sheila O’Leary) (July 28 – Aug. 3, 2006)