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Friday, July 9th, 2010
In representing franchisor clients against defaulting franchisees, it is imperative to give adequate thought to how the franchisor is going to prove its damages that resulted from a franchisee’s breach of the franchise agreement. When confronted with this issue, I most often utilize a financially competent representative of the franchisor to testify with regard to that amount of monetary damage suffered by the franchisor. The franchisor’s representative must be able to prove the damage by evaluating the franchisee’s financial statements, including revenues and/or profits, expenses, and royalties paid to the franchisor, and then determine what sums the franchisor would have earned either during and/or after the franchise term had it not been for the franchisee’s breach.
In order to testify convincingly and thoroughly, the franchisor’s representative must be able to analyze the franchisee’s financial numbers and draw a conclusion from such numbers. Therefore, a chief financial officer of a small franchisor, or an auditor or accountant of a larger franchisor, is an ideal representative in these instances, provided that the representative has been with the company long enough to be able to testify knowledgeably with regard to the details of the franchisor’s system.
Generally, a well-prepared franchisor representative will be permitted to testify as to the value or the projected profits of a franchised business provided the representative has a sufficient foundation for the analysis and opinion, including particular knowledge of the financial issues presented by virtue or his or her position in the franchisor company. This simply means that a franchisor representative may opine on the issue of lost profits where they know the franchisor and franchisee’s business and financial system intimately, and have the professional ability to analyze the franchisee’s financial statements.
To see how a franchisor SHOULD NOT approach the issue of proving its damages against a franchisee, see Lifewise Master Funding v. Telebank, 374 F.3d 917 (10th Cir. 2004), which in essence holds that a company’s witness as to damages must have personal knowledge of all items factored into his opinion in order for the opinion to be admissible. The court concluded that a business owner or executive may give “a straightforward opinion as to lost profits using conventional methods based on [the company’s] actual operating history.” However, because in this case the witness lacked personal knowledge of the factors used in the damages analysis, the opinion was inadmissible.
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Tags: arbitration, arbitration clause, breach of contract case, breach of contract lawsuit, business breach of contract, business contract review, business law, business lawsuit, business litigation, corporate litigation, federal franchise law, franchise agreement, franchise arbitration, Franchise Disclosure Document, franchise dispute, franchise future royalties, franchise law, franchise litigation, franchise royalties, franchisee, franchisor dispute, FTC Franchise Rule, maryland breach of contract, maryland business, maryland business law
Monday, April 12th, 2010
In TEKsystems, Inc. v. Bolton, (2010), the Maryland Federal District Court recently reinforced Maryland law on the point that the enforcement of a covenant not to compete is not dependent on whether the competing former employee solicits his former employer’s clients or uses its confidential information, but rather on whether or not the scope of the restrictive covenant is reasonable. The only factors that will determine whether the non-compete is valid are its temporal and geographical limits, the employer’s legitimate business interests, the employee’s unique and specialized skills, any undue hardship on the employee, and the public interest served by enforcing the restrictive covenant.
The non-compete found in the former employee’s employment agreement contained standard language prohibiting the former employee from engaging “in the business of recruiting or providing on a temporary or permanent basis technical service personnel, industrial personnel, or office support personnel” for a period of 18 months after termination of employment, and within a geographical limitation of a 50-mile radius of the employee’s former office. Both the period of time of 18 months and the geographical scope of 50 miles have been held as reasonable on numerous occasions by Maryland courts.
The Court also found that the employer had legitimate business interests in enforcing the covenant, the employee possessed unique and specialized skills, and the employee would not suffer undue hardship by enforcing the covenant. The enforcement of the non-compete was upheld against the former employee.
To read a comprehensive blog of all of the issues address by the Court in this case, visit the blog of the Business Law Section of the Maryland State Bar Association at http://marylandbusinesslawdevelopments.blogspot.com/search/label/Injunctive%20Relief.
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Tags: breach of contract case, breach of contract lawsuit, business breach of contract, business contract review, business lawsuit, business litigation, confidentiality agreement, confidentiality clause, corporate litigation, covenant not to compete, employment agreement, injunctive relief, maryland breach of contract, maryland business, maryland business law, NDA, non compete covenant, non disclosure agreement, non solicitation agreement, preliminary injunction, restrictive covenant
Monday, April 12th, 2010
In a recent Maryland Federal District Court Case, Antonio v. SSA, LLC, (2010) it was held that the parent of a company may not be held liable in Maryland for the acts of a subsidiary corporation under the corporate veil piercing doctrine without a showing of fraud or a necessity to enforce a paramount equity.
While the parent company, in this case ABM, did have control over the operations of the subsidiary company SSA, Inc., for example: (1) ABM owned 100% of the voting securities in SSA, Inc., (2) SSA, Inc. does not hold annual board meetings, keep corporate minutes, or conduct its own audits, and (3) all but one of SSA, Inc.’s officers are ABM’s officers, the Court held that control was by itself not enough to hold the parent company AMB liable and justify piercing the corporate veil.
The Court required that in order to hold the parent liable for the acts of the successor, the plaintiff mush show fraud on the part of the parent, or necessity to enforce a paramount equity. The court did not define what in this case would have amounted to a paramount equity, only stating that in this case none existed.
To read a comprehensive blog of all of the issues address by the court in this case, visit the blog of the Business Law Section of the Maryland State Bar Association at http://marylandbusinesslawdevelopments.blogspot.com/search/label/corporate%20veil.
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Tags: business formation, business incorporation, business law, business lawsuit, business litigation, business start up, corporate bylaws, corporate formation, corporate litigation, corporate parent, limited liablity company, LLC, maryland business, maryland business law, parent company, parent subsidiary, subsidiary corporation
Tuesday, March 2nd, 2010
Your business did what it was supposed to do when faced with a customer or client that owed money for goods or services your company provided under an agreement signed by both parties: You retained an attorney, who then filed a complaint in Maryland state court, or if the agreement called for it, filed an arbitration demand with the appropriate arbitration forum, against the other side on your company’s behalf.
Your business paid the attorney out of its own pocket and did things by the book. The other side may or may not have hired an attorney, and maybe did not take part in the case at all. Your attorney propounded discovery, the other side may or may not have complied with your requests. Your attorney attempted to depose a representative of the other side. You and your attorney showed up in court or at the arbitration on the day of the hearing, the other side may or may not have, and if they did show up, maybe with or without an attorney representing them.
The judge or arbitrator sided with your company after a trial or arbitration hearing on the merits, or your company was simply awarded a judgment by default when the other side failed to appear. In any event, your company was awarded damages, and maybe even attorney’s fees depending on what the agreement at issue said.
But when you left the hearing room that day, unfortunately you did not leave with a check from the other side. Instead, you left with a court’s order, or an arbitrator’s award, merely stating that you won and how much.
So the question now is, how do you actually get paid what the court or arbitrator awarded? Often times, the trial or arbitration is not the end, but rather only the mid-way point, of the collection process.
The first thing you must do in this situation is identify the debtor’s assets, as well as determine the value of each, by following Md. Rule 2-633, titled “Discovery in aid of enforcement.” Rule 2-633 states that you may conduct discovery in writing by mailing to the other side no more than 15 questions and requests for documents regarding the assets and other financial information of the debtor. These are known as Interrogatories in Aid of Execution. The debtor has 15 days from receipt to respond to these Interrogatories.
In addition to Interrogatories, Md. Rule 2-633(b) states that you may also petition the court to order the debtor to appear before a judge and answer under oath your questions related to the identity of the debtor’s assets. This is called requesting an Oral Examination in Aid of Enforcement of Judgment. Both of the above options may take place no earlier than 30 days after entry of the judgment.
Should the debtor ignore your Interrogatories or Request for Oral Exam, there are additional measures you may take, including filing to hold the debtor in contempt of court.
Assuming the debtor complies with your written requests or your oral exam, and you have successfully determined what assets the debtor owns and the value of each asset, now it is time to turn your attention to actually collecting on the judgment. One option you have is to garnish an individual debtor’s wages, done by filing a Request for Garnishment of Wages form with the court. You will then receive the garnished wages within 15 days of each of the debtor’s pay periods.
A second collection option is garnishing an individual or corporate debtor’s bank account. This is accomplished by filing a Request for Garnishment of Property Other Than Wages form with the court, using the financial information you gathered in your Interrogatories or Oral Exam. After 30 days, you must file an additional form, a Request for Judgment Garnishment.
Yet another collection option is seizing a debtor’s property or real estate, then selling it to help satisfy your judgment. Doing so requires the recording of your judgment in the circuit court for the county where the property is located, complete and file a Notice of Lien, and then file a Writ of Execution. This process if more complicated and time consuming than either garnishing wages or a bank account. Retaining a competent business attorney to help you in your collection efforts is a smart move.
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Tags: arbitration, arbitration award, breach of contract case, breach of contract lawsuit, business breach of contract, business law, business lawsuit, business litigation, corporate litigation, maryland breach of contract, maryland business, maryland business law
Monday, February 22nd, 2010
Last week I wrote Part 1 of this blog on the problems I have encountered with arbitration. Please see that post if you have not read it. What follows is Part 2 of the reasons that I advise my franchise and business clients why they should be wary of automatically including an arbitration clause in any franchise agreement or other contract that they execute:
4. Judges are generally more experienced, more versed in the law, and otherwise more qualified to hear disputes than most arbitrators. While not every judge is equally qualified, most judges have been vetted by their local and state bar organizations, and either elected by voters or appointed by politicians. Judges have a track record that can be reviewed and relied on. Judges in most courts serve on a rotational basis, hearing different types of cases and thereby gaining differing experiences. Judges have resources like law clerks to research the law for them. So while judges may lack technical expertise in a certain area, they make up for that my relying heavily on the attorneys and evidence presented in a given matter. Whatsmore, judges must construe existing law to base their rulings on, or else risk being overturned on appeal. Arbitrators, on the other hand, are in most cases practicing or retired attorneys with a specific area of expertise who have asked to be appointed to serve. Many times, an arbitrator will have only a peripheral knowledge of the subject of the arbitration, yet without the experience, knowledge of the law, or resources to ensure that his or her ruling is correct on the law. This set of circumstances can often times lead to inconsistent or downright baseless arbitrator’s decisions.
5. Judges produce formal opinions reciting the law relied on and applying the law to the facts to reach a decision. Many arbitrators, meanwhile, can issue awards without including their specific legal reasoning for an award. For purposes of appeal, judges are required to produce formal opinions citing the issues, facts, law and conclusion in an orderly fashion. This allows parties to focus many times on a distinct area for appeal, and allows appeals courts to easily review the court’s basis for a decision. Conversely, many arbitrators are required to issue only a narrowly written award unless otherwise agreed to by the parties. Even then, an arbitrator issuing a “reasoned award” may not satisfactorily explain the evidence relied on, the law used and how the arbitrator’s conclusion was arrived at. This not only makes it difficult for the parties to decipher how a particular arbitration award was arrived at, but more importantly, makes the record for appeal nearly impossible.
6. Even if an arbitrator issues a reasoned award, the right to appeal an arbitration award is extremely narrow when compared to a party’s ability to appeal a court ruling. In most instances, losers at trial have the right to appeal the merits of a court’s decision to a higher court “de novo”, using almost any substantive or procedural issue available to them. The basis of an appeal of an arbitration award however is severely limited, and many times requires the appealing party to clear such high hurdles as proving fraud, corruption of the arbitrator, or the arbitrator exceeding his or her powers. The difficulty of appeal, when combined with the erratic decisions of some arbitrators, is another reason to forego arbitration in favor of litigation, except in a specific set of circumstances discussed with and approved by my client.
Posted in business law, franchise law | 1 Response »
Tags: arbitration, arbitration clause, breach of contract case, breach of contract lawsuit, business breach of contract, business contract review, business law, business lawsuit, business litigation, corporate litigation, franchise agreement, franchise law, maryland breach of contract, maryland business, maryland business law
Saturday, February 20th, 2010
I frequently tell my franchise and business clients to be wary of automatically including an arbitration clause in a franchise agreement or other contract they execute. Several years ago it was savvy for a business owner or franchisor to include mandatory arbitration in their agreements. Now, many of the reasons that supported the inclusion of arbitration clauses have been diminished, making the inclusion of mandatory arbitration in many contracts a questionable strategy at best. I now advise my business and franchise clients against arbitrating disputes for the following reasons:
1. Arbitrations are not “cost-savers” like they used to be thanks to the multiple fees associated with the process. Unlike judges, arbitrators are paid by the parties on an hourly basis. It is therefore in an arbitrator’s financial interest for the case to reach a hearing, regardless of the claim’s merits. In addition, many hearings go on much longer than necessary, allowing witnesses and testimony with questionable relevance to be heard. As a result, arbitrator’s fees can be quite significant for even routine business disputes. The arbitrator’s fees are of course in addition to the fees that business clients pay to their own attorneys for handling the matter, plus the hefty filing fees that many arbitration forums charge as well. For example, the American Arbitration Association, the preeminent arbitration forum in the U.S., charges filing fees ranging from $300 to $2,500.00 for commercial arbitration disputes. Contrast these expenses with trials and other court hearings, where judges have no financial interest in prolonging a case, and filing fees are minimal.
2. The distribution of who pays the arbitrator’s and other fees can disfavor the party bringing the action. The filing party, known as the Claimant, will be responsible for paying not only the arbitration filing fees, but also its portion AND the other party’s portion of the arbitrator’s fees mentioned above should the defending party, called the Respondent, refuse to pay its share of such fees. In such a case, the Claimant must pay all fees in order for the matter to go on, yet the Respondent remains entitled to participate in the arbitration process. If the Claimant fails to pay all of the fees owed to the arbitrator, the arbitrator will likely suspend or dismiss the action entirely. Because there is no incentive for a Respondent to pay its share of an arbitrator’s compensation or other fees, the absurd ersult of the Claimant paying all fees happens more than one would think. Combined with the fees a Claimant must pay to its own attorney, it is easy to see why a business owner would question the use of arbitration in the first place.
3. Arbitrators have far more discretion to rule than judges, sometimes in spite of the evidence presented. The arbitration process is much less formal than a trial. While some informality saves the parties time and expense and speeds up the process, the biggest informality can alter the entire outcome, namely, the fact that the rules of evidence do not apply to arbitration. As a result, arbitrators are free to allow documents and testimony that is questionable as to veracity and authenticity into evidence, even though such evidence would not be permitted in a court of law. In plain terms, an arbitration hearing can literally turn into a free for all, with the arbitrator allowing all kinds of testimony and documents to be factored into an award. This sort of setting can severely hurt a business client who is relying strictly on the language of documents and the actions of the parties, while in turn favoring a party hoping for chaos, basing its case on hearsay and unsupported and unreliable accusations. [Tune in to PART 2 next week]
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Tags: arbitrate business disputes, arbitration, arbitration clause, breach of contract case, breach of contract lawsuit, business breach of contract, business contract review, business law, business lawsuit, business litigation, commercial arbitration, corporate litigation, franchise agreement, franchise arbitration, franchise law, litigate or arbitrate?, maryland breach of contract, maryland business, maryland business law, operating agreement, shareholder agreement, shareholder dispute
Thursday, January 21st, 2010
When looking to hire new personnel, my small business clients often ask me to draft the contract between the business and the new hire. It is oftentimes not until this point that the business has examined whether the new hire is an independent contractor or employee. An agreement used for an employee will be different in many key respects than an agreement drafted for use with an independent contractor. With that in mind, the following is a summary of the key differences between an employee and an independent contractor.
Much of this information has been taken from the IRS website at www.irs.gov, which contains a wealth of information on the subject and which I highly recommend every business reads when facing this issue. Just recently, the IRS published IRS Summertime Tax Tip 2009-20, which is summarized below.
-Hiring a worker as an independent contractor instead of as an employee will generally lessen the amount of taxes a business pays, because when a worker is an employee, employers must pay state and federal unemployment tax, social security tax and workers compensation/disability premiums to a State Insurance Fund. When a worker is an independent contractor, the business is not required to withhold these taxes or make these payments. That responsibility falls on the worker.
-The IRS uses three characteristics to determine the relationship between businesses and workers: Behavioral Control, Financial Control, and the Type of Relationship.
-Behavioral Control looks at whether the business has a right to direct or control how the work is done. The more control a business can exert over the work to be performed, the more likely the worker is an employee. Conversely, the more freedom and discretion the worker has in performing the work, the more likely the worker is an independent contractor. Do not confuse this with the business’s ability to control the result of the work done, a business is always permitted to exert control over results, and such control has no bearing on the contractor/employee discussion. Rather, the IRS examines the means by which the worker does the work.
-Financial Control looks at whether the business has the right to direct or control the financial and business aspects of the worker’s job. In other words, if the worker is on an employer’s payroll and receives a steady paycheck, the likelihood increases that the worker will be deemed an employee.
-The Type of Relationship factor relates to how the workers and the business owner perceive their relationship. It should be noted that the IRS will make its determination using substance over form, meaning that while it is interested in how the relationship between the parties is perceived by the parties, the IRS will make its determination ultimately regardless of how the parties paper their relationship.
In addition to the above points, the IRS has made clear in earlier publications that the following factors will also play a role in its determination:
-Who supplies the equipment, material, tools, workstations, and other items in order for the worker to perform the job. The more materials that the business supplies, the more likely the worker is an employee.
-Who controls the worker’s hours of employment.
Many times the characterization of the relationship between a worker and a business will be easy to determine. Sometimes, however, the line between employee and independent contractor will be blurred. It is in such a situation that the above factors must be analyzed carefully so that at the outset, a well written agreement hat accurately captures the parties’ relationship can be drafted and executed by the parties.
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Tags: breach of contract case, breach of contract lawsuit, business breach of contract, business contract review, business law, business lawsuit, business litigation, confidentiality agreement, covenant not to compete, employment agreement, employment contract, independent contractor, independent contractor agreement, maryland breach of contract, maryland business, maryland business law, non disclosure agreement, non solicitation agreement
Tuesday, December 8th, 2009
Maryland law is well settled that a non-compete must be reasonable in geographic scope and duration in order to be held enforceable. However, Maryland courts will enforce a covenant not-to-compete that does not contain a geographic limitation in certain narrow and limited circumstances. The U. S. District Court for the District of Maryland stated in Intelus v. Barton and Medplus, Inc., 7 F. Supp. 2d 635 (1998) that every non-compete must be examined to determine reasonableness based on the specific facts at hand, even non-competes that fail to contain a finite geographic limitation. The Intelus court stated:
“Competition unlimited by geography can be expected where the nature of the business concerns computer software and the ability to process information. . . Because of the broad nature of the market in which Intelus operates, a restrictive covenant limited to a narrow geographic area would render the restriction meaningless.”
In determining the reasonableness of a non-compete that does not contain a geographic limitation, Maryland courts will consider the nature of the industry and the national and perhaps global nature of the competition. In Intelus, the court concluded that the restriction was reasonably related and limited to Intelus’s need to protect its good will and client base, and therefore upheld the enforceability of the non-compete.
In Hekimian Labs, a Florida federal court, interpreting Maryland law, found that where “testimony indicated that competition within the business of remote access testing is such that the whole world is its stage” and “that there are only about 20 companies that compete in this business, and they do so on a worldwide basis,” then “to confine the restrictive covenant to a specified geographical area would render the Agreement meaningless.”
The Florida Court concluded that if the agreement did contain a geographical restriction, the offending party would only need to move outside of this restricted area and the damage to the harmed party would be the same. Because of the national and international scope of the competition between the parties, the absence of a specified geographic limitation was reasonably necessary for the protection of the party attempting to enforce the non-compete, and the covenant was upheld.
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Tags: breach of contract case, breach of contract lawsuit, business breach of contract, business contract review, business law, business lawsuit, business litigation, confidentiality agreement, corporate litigation, covenant not to compete, franchise agreement, maryland breach of contract, maryland business law, NDA, non disclosure agreement, non solicitation agreement, non-compete, restrictive covenant
Tuesday, December 8th, 2009
Maryland law permits a party to request injunctive relief from a Maryland federal or state court even when a contract states that all disputes must be referred to arbitration. The Court of Appeals of Maryland held in Brendsel v. Winchester Construction Company, Inc., 898 A.2d 472 (2006) that:
“[A]n interlocutory mechanics’ lien is in the nature of a provisional remedy, not much different than an interlocutory injunction or attachment sought to maintain the status quo so that the arbitration proceeding can have meaning and relevance, and the predominant view throughout the country is that the availability of such remedies by a court is permitted by the Federal and Uniform Arbitration Acts and is not inconsistent with the right to enforce an arbitration agreement.”
In its ruling, the Maryland Court of Appeals focused on the need for courts to have the ability to preserve the status quo by granting injunctive relief while a dispute is sent to arbitration. Without this ability, the Court held, a ruling by an arbitrator could very well be immaterial, as the damage done to a party could by that time be irreparable.
The Maryland Court of Appeals’ holding finds support from the Fourth Circuit in Merril Lynch et al. v. Bradley and Collins, 756 F.2d 1048 (1985):
“Accordingly, we hold that where a dispute is subject to mandatory arbitration under the Federal Arbitration Act, a district court has the discretion to grant a preliminary injunction to preserve the status quo pending the arbitration of the parties’ dispute if the enjoined conduct would render that process a “hollow formality.” The arbitration process would be a hollow formality where “the arbitral award when rendered could not return the parties substantially to the status quo ante.” Lever Brothers, 554 F.2d at 123.”
Therefore, Maryland courts are permitted to intercede and grant injunctive relief in spite of an arbitration clause where the absence of such relief would cause the arbitration to be nothing more than a “hollow formality.”
This power exists even when a contractual provision states that the parties must refer all disputes to arbitration.
Posted in business law, franchise law | 2 Responses »
Tags: agreement to arbitrate, arbitration, arbitration clause, breach of contract case, breach of contract lawsuit, business breach of contract, business law, business lawsuit, business litigation, confidentiality agreement, corporate litigation, covenant not to compete, franchise agreement, injunctive relief, maryland breach of contract, maryland business law, NDA, non disclosure agreement, non solicitation agreement, preliminary injunction, TRO
Thursday, October 29th, 2009
Mona Electric v. Truland, 193 F. Supp. 2d 874 (2002), as well as the appeal of that case, provide support for the position that a terminated employee who executed a non-solicitation provision when hired, but which did not contain an accompanying non-compete covenant, will not be in violation of the non-solicitation agreement if the clients and customers of the employee’s former place of business, and not the employee himself, initiate contact with the former employee for the purpose of conducting business. The District Court for the Eastern District of Virginia held:
“there is no evidence that Gerardi violated the Agreement by “soliciting” Mona’s customers. Truland hired Gerardi as a Service Account Manager. Gerardi’s responsibilities in this new position include preparing estimates and working in the field. A part of Gerardi’s position at Truland is handling customer solicitation calls. In the electrical contracting field, customers often solicit bids from the electrical contractors. Plaintiff has not presented any evidence that Gerardi has initiated calls to customers during his employment at Truland. Rather, the evidence is that Gerardi responded to customer calls to Truland for bids. Gerardi’s acts of responding to customers who solicited him for bids clearly do not violate the Agreement. Gerardi did not sign an agreement that prohibited him from competing with Mona, he signed an agreement that precisely prohibited his “solicitation” of Plaintiff’s customers. Plaintiff asserts that the Agreement prevents Gerardi from submitting estimates to customers who call him to request bids. This would turn the non-solicitation agreement into a non-competition agreement, and under the unambiguous terms of terms of the Agreement, only solicitation of Mona’s customer’s is prohibited. Thus, were the Court to find the Agreement valid, no evidence has been presented in this case that Gerardi violated the terms of the Agreement, and summary judgment should be granted for the Defendant.” Mona Electric v. Truland, 193 F. Supp. 2d 874 (2002).
On appeal, the Fourth Circuit Court of Appeals, applying Maryland law, upheld the lower court’s findings:
“Despite Mona’s assertion to the contrary, the district court held and we agree that the plain meaning of “solicit” requires the initiation of contact. (J.A. at 135.) Therefore, in order to violate the nonsolicitation agreement, Gerardi must initiate contact with Mona’s customers. Mona argues that Gerardi solicited when he submitted estimates to Mona’s customers. However, this does not fall within the plain meaning of “solicit.” If Mona intended to prevent Gerardi from conducting business with its customers it could have easily stated that in the agreement. Taking the facts in the light most favorable to Mona, there is no evidence that Gerardi solicited Mona’s customers. Therefore, summary judgment was proper and the district court is affirmed.” Mona Electric v. Truland, 56 Fed. Appx. 108 (2003). [On appeal]
Conclusion
The Mona case and its appeal give substantial support to the position that: 1) if an employee executed only a non-solicitation agreement and not a covenant not-to-compete; and 2) because Maryland courts will interpret “solicitation” as requiring some action on the employee’s behalf to initiate contact, then by itself, the employer would fail in its attempt to prevent the former employee from doing business with the business’ clients and customers, PROVIDED that the business cannot show that the employee actively solicited those customers. The employee is barred from soliciting, ie. from taking any action to initiate contact in order to gain business. Courts will strictly construe this requirement and delve into the actual conduct of the employee in order to determine whether the employee actually “solicited” customers.
Posted in business law | 1 Response »
Tags: breach of contract case, breach of contract lawsuit, business breach of contract, business contract review, business law, business lawsuit, business litigation, confidentiality agreement, corporate litigation, covenant not to compete, maryland breach of contract, maryland business, maryland business law, NDA, non disclosure agreement, non solicitation agreement
Raymond McKenzie is a corporate and franchise attorney in the Washington, D.C. metropolitan area.
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