PERMANENT NON-COMPETE REALLY IS
Updated: May 13, 2019
A 2005 court-approved settlement agreement permanently enjoined the defendants from hiring anyone previously employed by the plaintiff. Thirteen years later the defendants asked for relief from the injunction. It was denied.
The court said neither the commercial success of the parties nor changes in the market place were so dramatic as to warrant a modification of the injunction. The court took this position even though it said it was not convinced the plaintiff actually had any continuing substantial business need for the enforcement of a very broad permanent injunction. It also said it had substantial doubt that the individuals who might be hired if the injunction was lifted had any trade secrets that might be revealed.
WHY THIS IS IMPORTANT…
Getting an injunction is really tough. Once an injunction is in place it is just as tough to get rid of. Thirteen years ago, these parties struck a bargain which even the court now agrees probably does not matter. However, unless the parties agree to undoing the injunction, it is not likely to go away – ever. Remember this when considering making a permanent injunction part of a case settlement.