Legal Question in Employment Law in Georgia

Non-compete and non -solicitation

A competitor of ours went out of business - They sent out an e-mail to all their clients informing them that they would be ceasing opertaions and referred their clients to us (in the e-mail) as an alternative service provider. We tried to get them to inform us on who all they had sent the mail but was unsuccessfull - we hired one of their ex-employees and got some information from him as to their clients (contacts and names). The company closing its doors have now decide to sell their client list to someone else and is claiming they will try and enforce a dubious non-solicitation clause in their original contract with the employee. Can they do this after sending all tgheir clients teh e-mail referring them to us?


Asked on 5/07/09, 4:37 pm

2 Answers from Attorneys

Jeff Kent Kent & Merritt, P.A.

Re: Non-compete and non -solicitation

I'm afraid that I'm going to give you the typical lawyer's answer: it depends. A properly drafted non-solicitation agreement may be enforceable, and in some, but not all, cases may be assignable to an acquiring company. There are a number of factors which determine whether or not it is enforceable, such as what state's law applies, whether the agreement is narrowly tailored and not overbroad, whether it has an assignability clause, etc.

Even in the absence of a non-solicitation clause, there may be a confidentiality agreement regarding the client list. If the list rises to the level of a trade secret (which is generally difficult to do), there need not be a confidentiality agreement at all to prohibit the disclosure of the list itself. However, absent an agreement (and in most, but not all, states) the information in a former employee's head is generally fair game.

All of these are general principles, however, and you would be well advised to seek an attorney to review any non-solicitation agreements and discuss the situation with you.

Feel free to contact me if you have additional questions.

The foregoing is general information only, not specific legal advice. No attorney/client relationship has been created or should be implied.

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Answered on 5/07/09, 4:52 pm
Glenn M. Lyon, Esq. MacGREGOR LYON, LLC, Business Attorneys

Re: Non-compete and non -solicitation

I agree with Mr. Kent and would add that your company may have some liability exposure if you interfere with the ex-employee's obligation to your competitor regardless of the e-mail.

If you would like to discuss any issues further, please feel free to contact my office. My contact information is below. Thank you.

The foregoing is general information only, not specific legal advice. No attorney/client relation has been created or should be implied.

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Answered on 5/08/09, 9:52 am


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