WHAT YOU CAN DO: Consider whether one or more of these ten most common (a)

factual, (b) contractual, and (c) legal defenses to a non-compete may be available
to you. If so, your proactive presentation of them to your employer will likely be an
effective way to defeat your non-compete, preferably without even getting to a
Court battle:

1. Your intended new job may not, in fact, violate the precise terms of your noncompete agreement. More often than you might believe, people do not carefully
read over the precise words of their non-compete agreement, and dont carefully
consider whether it precludes their intended new job. Recently we won a noncompete battle because the agreement prohibited our client from working for an
employer who used the same or similar technology as the former employer, and
the new employer, in fact, did not do so. This potential defense cannot be
overlooked, and it often is. Another non-compete battle we recently won involved a
non-compete that said that our client, a saleswoman, could not sell to any of her
employers customers. Problem was, she did not have a list of them, and the
employer refused to give her one. Since it was impossible for her to know who she
could not sell to, she was relieved of any obligation to do so.

2. The non-compete restriction may be too vague to be enforceable. All too often,
in a misguided attempt to provide wide-reaching protection, employers and their
lawyers use language in non-compete agreements that is far too vague and too
broad to be enforceable at all. Prohibitions against selling advertising or working
in the dental profession are commonly found to be just too broad to enforce, and
thus null and void.

3. Unclean Hands is a common and effective defense. In order for an employer

to ask a Court to Order an employee to act in good faith and honorably, the
employer, itself, must first be doing so. If the employee departed from the company
because of extreme harassment or blatant discrimination, the employers noncompete enforcement efforts will likely fail. And, too, if the employer was engaged
in illegal or dishonest conduct, in which the employee did not want to participate,
non-compete efforts for this reason will also likely fail. If the illegal or dishonest
behavior was against clients, former employers are extremely reluctant to see such
matters raised in publicly available Court papers.

4. An employer must have a legitimate business interest to enforce a noncompete. The two recognized and accepted purposes of a non-compete

agreement are (1) the protection of trade secrets, and (2) the protection of valuable
business relations. So, why in the world would an employer need to keep a Janitor
or any other person who is no threat whatsoever to trade secrets or client relations
from working for a competitor? Non-competes cannot be used merely to punish or
set an example without a true legitimate business purpose at risk. For this reason,
too, an employer whose business is solely in communications cannot enforce a noncompete that prohibits a former employee from working for a company whose sole
business is selling shoes.

5. Unreasonable Breadth as to (a) Time, (b) Geography or (c) Activities. With a few
exceptions, Courts will refuse to enforce non-competes that are plainly
unreasonable in their restrictions. If the employer does business only in Duluth,
Minnesota, a restriction on your working for a competitor anywhere in the Western
Hemisphere will likely not pass judicial review. Likewise, no Judge will enforce a
non-compete that is, by its terms, to last 10 years. The same goes for a prohibition
against work for any potential competitor, as every business is a potential
competitor. In these situations, however, a Court might be tempted to enforce such
restrictions, but limit its enforcement to within five miles of Duluth for a period of
three months, and other employers in the same exact business. This has
historically been referred to as a Judge blue-penciling his or her enforcement
Order.

6. Void as Against Sound Public Policy. Sometimes the effect of a non-compete

violates a broader social purpose. So, for example, if it can be shown that an
employer uses a non-compete to maintain a monopoly in its business or trade, a
Court will likely not enforce that non-compete. The same holds true if it can be
shown that the non-compete requirement is only enforced against Hispanic
employees, and thus serves to maintain a discriminatory practice.

7. Prior Employer Breach. If an employer has previously breached an employment

contract with the employee (as was true in Morgans case, above), or has violated
an assurance to that employee, it cannot successfully argue to a Court that it has
the right to demand that its former employee abide by his or her non-compete
agreement.

8. Fraudulent Inducement. I cannot count how many times I have heard a client
say, I was told that they would not enforce this if I left, so long as I did not go to a
primary competitor, or some variation of that. Another common example is this:

You must sign this in order to be eligible for a bonus, and then you received no
bonus. If you were tricked into signing your non-compete by some assurance or
promise which does not appear to have been made in good faith, you may very well
have a sound basis to defeat that non-compete.

9. Sometimes, if Terminated Without Cause, Especially if There is Evidence of

Employer Bad Faith. The law in most states is just not clear on the question If an
employee is terminated without cause, is his or her non-compete enforceable?
Some Courts say Yes, while other Courts say No. Most importantly, though, most
Courts will not enforce such a non-compete agreement if they feel the employer has
acted in bad faith, and most will enforce it if the employee has acted in bad faith.
Attorneys often battle to convince the Judge that it is their client who is wearing
the White Hat, and the other side is wearing a Black Hat. (In cowboy movies of
years ago, that is how you could tell the difference between the Good Guy and the
Bad Guy.) It is for this reason that we strongly encourage our clients to avoid any
appearance of impropriety, and to report to us any indications of impropriety by
their employers.

10. Other Contractual and Factual Defenses. A non-compete agreement is a kind

of contract and, for this reason, is always subject to the many defenses to contracts
available in the law, including the ones noted above, and these others: (a) The
employer is simply in error on the facts: I am not violating the agreement; (b) I
never signed it; (c) it is a forgery; (d) both sides were under a false impression, or
made a material mistake, at the time the agreement was made (failure to read the
agreement does not suffice); (e) I signed it under duress, such as blackmail (this is
not commonly effective in non-competes); and (f) It requires me to do something
that is illegal. The contract defense of no consideration, meaning that the
employee did not get anything in return, is usually not available in non-compete
matters, as most Courts say that the continuation of employment was, itself,
sufficient consideration.

So, you may think, what do I do if I may have a valid defense or good argument
against, my employer trying to enforce my non-compete? We usually suggest that
the employee consider bringing the valid defense(s) and/or strong argument(s) to
the attention of the employer (and the employers attorney, if his or her identity is
known), and say, in effect, Strong factual, contractual and legal bases exist such
that this non-compete agreement is not enforceable, and I think that, if you go to
Court, you should be honest with the Judge that you know about these defenses;
otherwise you will be deceptive to the Court, something you really should not do.