Enforcability of non-compete agreement

[Alan Sandige]

Alabama - Worked for a company in California for over 30 years. As an hourly paid engineer I had to sign a non-compete agreement. As I understand it the agreement is null and void now because the company closed, I moved out of state and moved to Alabama which doesn't enforce non-compete agreements, not to mention there was no geographical qualification in the agreement. Of more concern is a new agreement I was forced to sign just before the company closed. The new agreement, though it is titled as an Agreement, in all aspects of it's makeup fit the requirements of a non-compete agreement as I understand it, and again it still does not contain a geographical limitation. It was signed while the business was still active, at the business location, during business hours and witnessed by another employee. This company did not exist in any other state. I'm wondering if this agreement is indeed a non-compete agreement. Here is the gist of the agreement.
agreement [link removed]

 

[quincy]

Alabama - Worked for a company in California for over 30 years. As an hourly paid engineer I had to sign a non-compete agreement. As I understand it the agreement is null and void now because the company closed, I moved out of state and moved to Alabama which doesn't enforce non-compete agreements, not to mention there was no geographical qualification in the agreement. Of more concern is a new agreement I was forced to sign just before the company closed. The new agreement, though it is titled as an Agreement, in all aspects of it's makeup fit the requirements of a non-compete agreement as I understand it, and again it still does not contain a geographical limitation. It was signed while the business was still active, at the business location, during business hours and witnessed by another employee. This company did not exist in any other state. I'm wondering if this agreement is indeed a non-compete agreement. Here is the gist of the agreement.
[link removed]

You can have the agreement reviewed by an attorney in your area. We cannot analyze contracts on this forum.


Your post was reported to have your link removed. Personal identifying information should not be posted on this forum. This is for your protection.

I can tell you that noncompetes without geographical or time restrictions are unlikely to be enforceable.

 

[Alan Sandige]

This AGREEMENT is made and entered into as of this (date, January, 2019) by and between (owner) residing at (owner address), and (employee), currently residing at (employee address).

WHEREAS, currently (company) retains 50% ownership of all firmware, hardware designs, PCB designs, and Software Copyrights to all of the following list of products that are currently being marketed by (company buying products).

List of SAID Products:
(list of 11 products)

WHEREAS, (owner) is the 100% owner of (company)

WHEREAS, (company) is planning to shut down the business at the end of the day on (date, end of March, 2019) and the 50% ownership of SAID products will become the sole property of (owner).

WHEREAS;
1- (employee) agrees NOT to aid or supply any technical information or support, to any entity, including (company buying products) without the expressed WRITTEN consent from (owner). This includes but is NOT limited to, PCB designs, Firmware, hardware designs, and any Windows based support software.
2- (employee) agrees NOT to develop, or assist in developing of any NEW products that are similar in function to any of the SAID products without the expressed WRITTEN consent from (owner) until (date, end of March, 2022).
3- (owner) hereby authorizes (employee) to perform REPAIRS on SAID products, and all other (company) manufactured products, at (employee's) sole expense and liability, until this privilege is revoked in WRITING by (owner). (employee agrees NOT to represent himself as (company).

 

[quincy]

This AGREEMENT is made and entered into as of this (date, January, 2019) by and between (owner) residing at (owner address), and (employee), currently residing at (employee address).

WHEREAS, currently (company) retains 50% ownership of all firmware, hardware designs, PCB designs, and Software Copyrights to all of the following list of products that are currently being marketed by (company buying products).

List of SAID Products:
(list of 11 products)

WHEREAS, (owner) is the 100% owner of (company)

WHEREAS, (company) is planning to shut down the business at the end of the day on (date, end of March, 2019) and the 50% ownership of SAID products will become the sole property of (owner).

WHEREAS;
1- (employee) agrees NOT to aid or supply any technical information or support, to any entity, including (company buying products) without the expressed WRITTEN consent from (owner). This includes but is NOT limited to, PCB designs, Firmware, hardware designs, and any Windows based support software.
2- (employee) agrees NOT to develop, or assist in developing of any NEW products that are similar in function to any of the SAID products without the expressed WRITTEN consent from (owner) until (date, end of March, 2022).
3- (owner) hereby authorizes (employee) to perform REPAIRS on SAID products, and all other (company) manufactured products, at (employee's) sole expense and liability, until this privilege is revoked in WRITING by (owner). (employee agrees NOT to represent himself as (company).

So the agreement is not only a noncompete but a nondisclosure/confidentiality agreement. The part of the agreement that deals with trade secrets and rights-protected material potentially can be enforceable forever.

Again, if you have questions about the restrictions placed on you by the agreement, you will want the agreement personally reviewed by a professional in your area. We cannot do personal reviews or contract analyses on this forum.

Good luck.

 

[Alan Sandige]

So it is possible it can exist even beyond the closure of the company even if the base source code was developed on my own family time (seeing as I was an hourly employee)?

 

[quincy]

So it is possible it can exist even beyond the closure of the company even if the base source code was developed on my own family time (seeing as I was an hourly employee)?

That I can’t tell you. You will need to have your employment contract personally reviewed in its entirety.