Wednesday, February 17, 2010

New Wisconsin Non-Compete Ruling

This is important.

Non-compete agreements in Wisconsin have a history of not being viewed favorably by the courts in Wisconsin. Enforceable agreements are difficult to draft, leaving litigants to search agreements with a fine-toothed comb to find any hint of over-breadth on the part of the employer, then arguing that the unreasonableness of one restriction renders all restrictions unenforceable.

This "void one, void them all" approach was fostered by a 2001 decision in which the court of appeals held that provisions in non-compete agreements are "intertwined and indivisible" if they govern similar activity which almost all restrictive covenants do.

However, the Wisconsin Supreme Court has now overruled that decision,...

Hmmm.

Among other things:

Employers have a legitimate interest in prohibiting solicitation of former customers who were customers within the recent past, even though the employer does not have a current relationship with the customer.

That changes the landscape, folks.

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