April 2009
A federal court, interpreting Minnesota law regarding non-compete agreements, recently enjoined a former regional sales manager in the medical device field from soliciting sales from his former customers. The court found the contract at issue in the case was supported by valid consideration and thus enforceable because the employee signed the non-compete in exchange for his promotion from sales representative to regional sales manager. Another interesting aspect of the court's decision is that in issuing its injunction prohibiting the defendant from soliciting his former customers, the court observed that its order would not economically harm him due to the guaranteed $600,000.00 salary he had secured from his new employer. A lawsuit against the hiring employer for interfering with the employee's non-compete agreement with his former employer now seems likely.
As a management-side firm, non-compete agreements are perhaps the only area of practice at Wessels Sherman where our attorneys may wind up on either side of an issue (though not in the same case). We frequently draft and enforce these agreements for our clients.
Questions? Please contact WS Shareholder and Senior Attorney James Sherman in the firm's Minneapolis office at (952) 746-1700, or jasherman@wesselssherman.com.
