Your best sales representative tells you at 5:00 p.m. on a Friday that she is quitting immediately and going to work for your direct competitor. “But you have a non-compete agreement,” you sputter. “That won’t hold up,” she retorts. “It’s been real, it’s been fun, but not real fun,” she exclaims, then walks out.
Is the sales representative right about the non-compete agreement not holding up? That depends on the facts. But contrary to myth, Minnesota courts enforce non-compete agreements routinely. They can and will hold up. What should you do to protect your business? Contact an attorney experienced in enforcing non-compete agreements in court.
The attorney will ask you threshold questions to test the validity of the agreement. Was the non-compete agreement made ancillary to the sales representative’s initial employment with your company or, if not, was independent consideration paid? Is there a legitimate interest to protect through enforcement – for example, the former employee’s ability to deflect customer business to the competitor or to use or disclose of confidential information? Are the temporal, geographic, or customer-based restrictions in the non-compete covenants reasonable?
If a good faith basis exists to seek judicial enforcement of the non-compete, and you choose to do so, you and your attorney have got a lot of work to do in a short amount of time. The longer a party waits to seek enforcement, the less likely a court will enforce the agreement. You will need the following:
- Complaint – A pleading that states the general factual allegations and lists the legal causes of action.
- Affidavit(s) – A formal, sworn witness statement, verifying facts based on personal knowledge.
- Motion for Temporary Restraining Order – A formal request for a temporary restraining order (or “TRO” for short).
- Notice of Hearing – A short document stating the date, time, and place of the hearing on the motion.
- Memorandum of Law – A brief applying applicable law to the facts.
- Proposed TRO – The factual findings and conclusions of law that you want the court to make.
- Attorney Affidavit – Your attorney’s affidavit addressing any necessary information, such as whether the opposing party was served or notified.
- Summons – A formal document to serve on the opposing party with a copy of Complaint.
- Court Forms
- Filing Fee Check
- Cover Letters
A TRO request may be necessary to protect your business from irreparable harm. Reasonable non-compete agreements can be, and will be, enforced through this process.
*This post was originally written by Steve Wilson.