NY Trial Court Holds Non-Compete Clause Unenforceable
In a decision that is scheduled to appear in tomorrow's edition of the New York Law Journal, a New York County court relied on established principles to hold unenforceable a former employee's non-compete agreement.
More particularly, in Eyes of the World v. Boci, a beauty parlor sued to enforce a restrictive covenant (i.e., the non-compete clause) agreed to by the defendant which stated, in effect, that Boci was barred from soliciting any of their existing hair-removal clients for one year post-resignation.
At first blush, it seems like this non-compete had a rational basis for being enforced; after all, the agreement was limited in geographic scope (New York), and was for a limited duration (one year).
But, as the Court pointed out, the plaintiff still had a major flaw in its reasoning:
They couldn't show that the defendant had misappropriated trade secrets, or that the services rendered by the defendant were unique or extraordinary.
To that end, the Court stated as follows:
"[T]he covenant at bar is unreasonable in its limitation, burdensome to the employee, and not necessary to protect the employer's legitimate interests ... [D]espite Boci's training, her job and skills used for that job are not legally considered unique or extraordinary ... [I]t appears that clients opted to follow Boci based on their needs and her ability. Shobha's restrictive covenant is overly broad and unenforceable."
More particularly, in Eyes of the World v. Boci, a beauty parlor sued to enforce a restrictive covenant (i.e., the non-compete clause) agreed to by the defendant which stated, in effect, that Boci was barred from soliciting any of their existing hair-removal clients for one year post-resignation.
At first blush, it seems like this non-compete had a rational basis for being enforced; after all, the agreement was limited in geographic scope (New York), and was for a limited duration (one year).
But, as the Court pointed out, the plaintiff still had a major flaw in its reasoning:
They couldn't show that the defendant had misappropriated trade secrets, or that the services rendered by the defendant were unique or extraordinary.
To that end, the Court stated as follows:
"[T]he covenant at bar is unreasonable in its limitation, burdensome to the employee, and not necessary to protect the employer's legitimate interests ... [D]espite Boci's training, her job and skills used for that job are not legally considered unique or extraordinary ... [I]t appears that clients opted to follow Boci based on their needs and her ability. Shobha's restrictive covenant is overly broad and unenforceable."
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