How to avoid a non-compete lawsuit?

In most states, non-compete agreements are enforceable in some shape or form, and many states enforce non-compete agreements regardless of whether an employee quit or was fired. See here.

Therefore, rather than assume that their non-compete agreements are not enforceable, departing employees should take the following steps to mitigate the risk of getting sued for violating their post-employment obligations:

1. Return all company property back to the former employer;
2. Do not take any company documents, emails, or other information;
3. Do not erase company devices prior to returning them;
4. Do not solicit customers or co-employees to leave the employer;
5. Do not ignore any cease & desist letters from the former employer;
6. Have some money set aside to fight the non-compete, if necessary.

Many employees assume that if they were let go their non-compete agreement automatically becomes null and void. This is not true, however, in a lot of states, and this assumption can turn out to be very costly for an employee.

Instead of making assumptions about the enforceability of a non-compete agreement, is it better to err on the side of caution and make sure that the departure from the former employer is as smooth as possible and avoid doing some of the things described above that can often trigger a non-compete lawsuit.

Leiza Dolghih is a partner at Lewis Brisbois Bisgaard & Smith LLP in Dallas, Texas and a Co-Chair of the firm’s Trade Secrets and Non-Compete Disputes national practice. Her practice includes commercial, intellectual property and employment litigation. You can contact her directly at Leiza.Dolghih@LewisBrisbois.com or (214) 722-7108.

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