NY Trial Court Holds Non-Compete Clause Unenforceable
1/1/2016In 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."