New York Court Denies Enforcement of Employee Non-Compete Agreement Because Employer Failed Evidentiary Burdens
Posted:
Tuesday, November 11, 2008
By:
Joshua C. Dickinson
Topic:
Non-Compete Cases
In Delfino Insulation Co., Inc. v. Jaworski, 865 N.Y.S2d 353 (2008), the New York Court of Appeals recently re-affirmed several standards for enforcement of non-compete agreements in New York. Specifically, the court held that the
employer bears the burden of demonstrating at least the following issues: (1) that the former employee breached the geographical limitation of the agreement, (2) that the restraint on employment imposed by the agreement was "no greater than is required for the protection of [its] legitimate interest," or (3) that the
services were unique and extraordinary, such that the information in question constituted trade secrets or confidential customer information.
The court also held the new employer cannot be held liable for tortious interference with the parties' previous employment agreement if the new employer had no knowledge that the employee labored under an employment agreement. Because the previous employer failed to demonstrate these issues, the court affirmed the trial court's grant of summary judgment.
The case illustrates that the enforcing employer bears the burden of proof on all elements of its claims.