Defending a Non Compete Lawsuit
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Many employees in Massachusetts have signed agreements not to compete after the end of their employment. Many who have been in their jobs for a number of years may not even remember that they signed an agreement. So it can come as a surprise and a shock when you give your notice and accept a new job, only to find yourself on the receiving end of a lawsuit claiming you have violated your contract. Non compete lawsuits usually include a request for immediate court action, so you may receive court papers with very short notice to appear in court and answer to the suit.
Sometimes the plaintiff either sues or threatens to sue your new employer for interference with your contract. This can be extremely frightening, but our non compete lawyers have been through it many times and are here to help. You can read the answers to some frequently asked questions about responding to a lawsuit, but the basic information is below. Summary Most likely you received a document called a "summons," which states the amount of time you have to respond. The complaint should lay out the facts your former employer is claiming and their legal claims. In a lawsuit arising from a restrictive covenant, it is common also for the package to include a motion for a preliminary injunction, and a "short order of notice" setting a date- usually a very short time away- for you to appear in court and "show cause" why the court should not issue an injunction. The most important thing you need to understand is that you should seek the advice of an employment lawyer immediately . Understanding the Court Papers You Have ReceivedMost likely you received a document called a "summons," which states the amount of time you have to respond. It should be accompanied by a document called a "complaint" or a "verified complaint." The complaint should lay out the facts your former employer is claiming and their legal claims.
In a lawsuit arising from a restrictive covenant, it is common also for the package to include a motion for a preliminary injunction, and a document called a "short order of notice" setting a date- usually a very short time away- for you to appear in court and "show cause" why the court should not issue an injunction. If you are like most people who are not lawyers, up to half the words in the above paragraph made no sense to you. Translated, this is what they mean. Usually in a civil lawsuit, there is a complaint filed with the court. There is then a period of time (usually 20 days) for the person being sued to file an answer. If your employer is seeking injunctive relief, you may have a shorter period of time to respond. |
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What To Do First in a Non Compete Lawsuit
The most important thing you need to understand is that you should seek the advice of an employment lawyer immediately, especially if you see paperwork requesting a preliminary injunction- you may have only a matter of days to put together a response and present your case to the court.
The next thing you need to do is make sure you gather and preserve any documents, emails or otherwise, relevant to your former job and your new job. Your attorneys will need this information, often in short order, to develop your defenses. Also if the matter is not settled, you can face serious sanctions from the court if you have destroyed or discarded relevant evidence, whether it is helpful to you or not.
The next thing you need to do is make sure you gather and preserve any documents, emails or otherwise, relevant to your former job and your new job. Your attorneys will need this information, often in short order, to develop your defenses. Also if the matter is not settled, you can face serious sanctions from the court if you have destroyed or discarded relevant evidence, whether it is helpful to you or not.
Responding to the Complaint
The good news is that while this may be new to you, it's not new to us. Here are the steps we take to address lawsuits and requests for preliminary injunction.
First, we meet with you to assess your agreement. We will also ask some questions about your old job and your new job that will help us determine how likely it is that the court will enforce the contract against you. You can read more about some available defenses here.
Second, we explore with you whether you have any potential legal claims against your employer. It may never have occurred to you to question whether you were paid everything you were owed, or whether there was anything about how you separated from your former employer that could be unlawful. Once you have been sued for something arising out of that employment relationship, you may have to raise any claims you have or lose your right to raise them in the future. Further, any employment law claims you have against your employer can be very helpful in reaching a resolution of your case.
Third, we explore with you, and with the lawyers for your employer if appropriate, whether there is a resolution short of court action that would meet everyone's needs. For example, you may have a contract that bars you from working in your industry at all for a period of time, but as a practical matter your employer may only be worried about a few key accounts or customers. In those situations, we are often able to settle the case early on with a specific agreement about not doing business with those customers for the restricted period.
Fourth, if we can't settle it we fight it. We have done this many times, and will walk you through the whole process. You may need to sign an affidavit, but the rest of the work assembling the documents, making the legal arguments, and addressing the court, is on our plate.
First, we meet with you to assess your agreement. We will also ask some questions about your old job and your new job that will help us determine how likely it is that the court will enforce the contract against you. You can read more about some available defenses here.
Second, we explore with you whether you have any potential legal claims against your employer. It may never have occurred to you to question whether you were paid everything you were owed, or whether there was anything about how you separated from your former employer that could be unlawful. Once you have been sued for something arising out of that employment relationship, you may have to raise any claims you have or lose your right to raise them in the future. Further, any employment law claims you have against your employer can be very helpful in reaching a resolution of your case.
Third, we explore with you, and with the lawyers for your employer if appropriate, whether there is a resolution short of court action that would meet everyone's needs. For example, you may have a contract that bars you from working in your industry at all for a period of time, but as a practical matter your employer may only be worried about a few key accounts or customers. In those situations, we are often able to settle the case early on with a specific agreement about not doing business with those customers for the restricted period.
Fourth, if we can't settle it we fight it. We have done this many times, and will walk you through the whole process. You may need to sign an affidavit, but the rest of the work assembling the documents, making the legal arguments, and addressing the court, is on our plate.
Will Your Employer Get an Injunction?
We obviously can't say without reviewing your situation what the chances are that you will have an order issued against you, but we can lay out some of the basic guidelines and principals to help you think about it.
Issuing an order, or a preliminary injunction, at the beginning of a lawsuit is considered extraordinary relief. In order to get an injunction, your employer will have to prove two things. First, that they are likely to win on their claims that your agreement is enforceable and you are violating it. Second, they have to show that they are in immediate danger of suffering harm that can't be fixed down the road by an order of damages. This is called "irreparable harm" or "irreparable injury." In a covenant not to compete case, usually the employer is arguing either that they will be harmed by the disclosure of trade secrets or confidential information or by damage to their goodwill, and that one or both of these harms to their business interests is too intangible to be easily addressed with money damages in the future.
Your defense, therefore, must be focused on undermining the merits of their case. We will compile evidence and arguments to show that the agreement is unenforceable, or not compliant with Massachusetts law. This could include evidence that the things your employer is trying to protect are not legitimate business interests under Massachusetts law. It could include evidence that the job you have taken does not fit within the terms of your contract. If your agreement was signed after the new Massachusetts non compete law went into effect in October 2018, there are a number of additional reasons it may be unenforceable. Finally, if you were paid as an independent contractor and not as an employee, you may have additional bases to challenge the contract.
Issuing an order, or a preliminary injunction, at the beginning of a lawsuit is considered extraordinary relief. In order to get an injunction, your employer will have to prove two things. First, that they are likely to win on their claims that your agreement is enforceable and you are violating it. Second, they have to show that they are in immediate danger of suffering harm that can't be fixed down the road by an order of damages. This is called "irreparable harm" or "irreparable injury." In a covenant not to compete case, usually the employer is arguing either that they will be harmed by the disclosure of trade secrets or confidential information or by damage to their goodwill, and that one or both of these harms to their business interests is too intangible to be easily addressed with money damages in the future.
Your defense, therefore, must be focused on undermining the merits of their case. We will compile evidence and arguments to show that the agreement is unenforceable, or not compliant with Massachusetts law. This could include evidence that the things your employer is trying to protect are not legitimate business interests under Massachusetts law. It could include evidence that the job you have taken does not fit within the terms of your contract. If your agreement was signed after the new Massachusetts non compete law went into effect in October 2018, there are a number of additional reasons it may be unenforceable. Finally, if you were paid as an independent contractor and not as an employee, you may have additional bases to challenge the contract.
How We Can Help
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We have years of experience representing people in non compete lawsuits in Massachusetts state and federal courts, and we would be happy to help. You can use the button below to schedule a call back from a member of our team, or give us a call at 781-784-2322.
