Legal Question in Business Law in New York

Non Compete, non solicitation agreement. My freelance vendor got "spooked" by this document. Says that article 7 is too far reaching not letting the freelancer work with anyone else without our permission. Also, does this document act as a "catch-all" so the freelancer only has to sign once for any client we reveal to the freelancer? Or does the freelancer need to sign a separate document for every client revealed to them? Please advise.

Here's the full document:

Confidential Non-Disclosure & Non-Compete Agreement

This Confidential Non-Disclosure & Non-Compete Agreement (�Agreement�) is made between:

_____________________(�Receiving Party�)

[Insert Street]

[Insert City, State & Zip Code}

_________________________(�Disclosing Party�)

[Insert Street]

[Insert City, State & Zip Code]

1. On the understanding that both parties are interested in meeting to consider possible collaboration in developments in developments arising from Disclosing Party�s web site development, including computer programming, graphic design, e-commerce, multimedia programming and design, it is agreed that all information whether oral, written or otherwise, that is supplied to the Receiving Party in the course of any meeting shall be treated as confidential by the Receiving Party.

2. The Receiving Party undertakes not to use the information for any purpose, other than for the purpose of considering collaboration, without obtaining written agreement of the Disclosing Party.

3. This Agreement applies to both technical and commercial information communicated by either Party.

4. This Agreement does not apply to any information in the public domain or which the Receiving Party can show was either already lawfully in their possession prior to its disclosure by the Disclosing Party or acquired without the involvement, either directly or indirectly, or the Disclosing Party.

5. Neither Party to this Agreement shall retain any documents or items connected with the disclosure after collaboration has ceased.

6. No disclosure made by the Receiving Party shall create any license, title or interest in respect of any Intellectual Property Rights of the Disclosing Party.

7. Receiving Party agrees not to engage in any employment, consulting, or other activity involving computer programming, graphic design, Internet or web site development, e-commerce, video or film production or editing, multimedia programming, or design that competes with the business, proposed business or business interests of Disclosing Party without Disclosing Party�s prior written consent.

8. Receiving Party shall not solicit any of Disclosing Party�s clients or prospective clients to perform services that compete with the business, proposed business or business interests of Disclosing Party without Disclosing Party�s prior written consent, and Receiving Party will not assist any other person or entity in doing so, without Disclosing Party�s prior written consent.

9. After 3 years from the executed date, each Party shall be relieved of all obligations under this Agreement.

Signed ____________________________ �Disclosing Party� Date _____________

[Name]

Signed ____________________________ �Receiving Party� Date _____________

[Name]


Asked on 7/17/14, 5:46 am

1 Answer from Attorneys
Andrew Muchmore Muchmore & Associates PLLC

Your freelancer was wise to raise an issue and not just sign it without thinking. The language in Article 7 is incredibly broad and leaves it very unclear as to what work he could or could not perform if he signed it. Moreover, overly broad non-compete clauses are often not enforced by the courts as they are written. You should modify the language of Article 7 to be far more specific, ideally stating that the freelancer agrees not to work for any client he has worked for through your firm for a designated period, perhaps 3 years. If you leave the provision this broad, both you and the freelancer will be left in an ambiguous situation where it is not clear what the non-compete covers or whether it would be enforced by the courts.

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Answered on 7/17/14, 12:05 pm


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