Crumpton Law is experienced in litigating, negotiating, drafting, and reviewing non-compete agreements, especially non-compete agreements governed by Ohio law. The firm represents both employees and employers and offers the following services related to anticipated non-compete litigation:

• Flat fee non-compete agreement drafting for employers. (See flat fee services page for more information.)

• Consultation and review of Non-Compete Agreement prior to litigation, including drafting an opinion letter regarding the likelihood of enforceability of a particular non-compete provision.

• Pre-litigation correspondence and/or negotiations

• Full-service non-compete litigation. (See below for an explanation of what happens in non-compete litigation.)

In many industries, employers ask employees to sign covenants not to compete with the employer (also known as non-compete clauses). These covenants are often not negotiated between the employee and employer and are contained within an employment agreement that may not have been read by the employee before signing it.

In Ohio, non-compete clauses are enforceable if they protect a legitimate business interest of the employer, do not create undue hardship to the employee, and are not injurious to the public. The clause must also be reasonable, which is determined by an eight-factor test set forth by the Ohio Supreme Court. The most often discussed reasonableness factor is the time and geographic scope of the agreement. However, there are several other important factors considered by courts in deciding whether to enforce non-compete clauses.

Non-compete litigation is highly fact sensitive. No two cases are the same. However, most cases begin with a complaint and motion for a temporary restraining order (TRO) and preliminary injunction being filed simultaneously by the former employer. Upon filing the motion for TRO, the former employer will have a hearing in front of a judge regarding the TRO. Whether the TRO is granted depends heavily upon the judge and the facts of the particular case.

If a TRO is granted, the employee will be enjoined from working in the area mentioned in the non-compete clause. If the TRO is denied, the employee will be permitted to continue to work for his or her new employer. A TRO generally lasts until a preliminary injunction hearing can be scheduled, but not more than 14 days. It can be renewed for one additional 14-day period.

The TRO hearing is often followed by a period of up to two weeks of expedited discovery. During this time, the parties will send interrogatories and requests for production of documents, and may conduct depositions. The discovery conducted during this time is used in the preliminary injunction hearing.

The preliminary injunction hearing is generally like a trial. However, it is argued to a judge, not a jury. Depending on the judge (or magistrate), there will be opening statements, witness testimony, and closing arguments.

If the preliminary injunction is granted, the former employee cannot work in the prohibited area of employment until after the trial is over. Often, this period of time can be a year or longer. If the preliminary injunction is denied, the employee may work in the area prohibited by the non-compete until the trial.

There are common mistakes made by employees that should be avoided if possible.

A former employee worried about a non-compete should retain an attorney immediately to attempt to settle the matter. An out-of-court settlement, while not always possible, will spare both parties the expense of litigation (which can add up quickly). Also, if the former employee has an attorney who has already contacted the former employer’s attorney, then the former employer’s attorney must contact the former employee’s attorney if a temporary restraining order is sought. This gives the former employee a better chance at success in defending the TRO.

If a TRO or preliminary injunction is granted, the employee must follow it. Failure to follow a court order could lead to fines or even jail time. Often, obeying an injunction means that the employee will have to travel long distances to work out of another office of his or her new employer.

Finally, a former employee should not contact customers of his or her former employer. Such contact is frequently punished with monetary damages and an injunction to prohibit the contact in the future.

For more information on non-compete agreements under Ohio law, contact us today at matt@crumpton-law.com!