The North Carolina Court of Appeals decision in Aesthetic Facial & Ocular Plastic Surgery Ctr., P.A. v. Zaldivar highlights the unique impact of public policy considerations when determining the enforceability of a non-compete agreement against a medical doctor. To what extent are such agreements enforceable? At what point does the concern for the health of the general public outweigh the interest in enforcing the specific terms of an employment contract? Elements to Determine the Enforceability of Non-Compete Agreements A non-compete agreement restricts a former employee’s ability to work for a competitor of, or otherwise compete with, the employer. They are frequently contained in employment contracts. North Carolina recognizes…
-
-
The Strict Blue Pencil Doctrine is Alive and Well in NC Courts
In a time where pencils and pens are quickly being replaced by keyboards, styli, and even one’s own fingers, the North Carolina Supreme Court ruled last week that the strict blue pencil doctrine remains alive and well – at least when it comes to non-compete clauses in employment agreements. The blue pencil doctrine originated in 1961 and essentially states that if a non-compete clause in an employment contract is “unreasonably broad,” then the Court has the power to use its blue pencil to literally strike the over broad provisions from the contract. Last week, in Beverage Sys. Of the…
-
North Carolina Business Court: Employment Agreements Automatically Terminate Upon the Sale of a Company
A recent decision by the North Carolina Business Court held that an employment agreement automatically terminates upon the asset sale of one company to another, despite continued employment with the purchasing company.[1] In 2001, Andrew Lund executed an employment agreement with his then-employer, Southern Staircases of North Carolina, Inc. The agreement contained several post-employment restrictions regarding disclosing confidential information and soliciting current and future customers. The agreement also contained a duty of loyalty provision to “devote his entire working time, attention, and energies to the business of the Company and . . . [to] not be engaged in any other business…
-
Eastern District of North Carolina Predicts the North Carolina Supreme Court Will Apply the Doctrine of Inevitable Disclosure “Under Certain Circumstances.”
The Eastern District of North Carolina recently decided a case affirming that, while North Carolina courts have not yet adopted the doctrine of inevitable disclosure, North Carolina would adopt the doctrine under certain circumstances.[1] Spirax Sarco, Inc., (“Spirax”), alleged a claim for, among other things, injunctive relief under the doctrine of inevitable disclosure against one of its former employees. Spirax purported that defendant Bryan Johnson (“Johnson”) used his company issued laptop to download thousands of confidential computer files to personal devices without permission. Johnson resigned from Spirax on May 27, 2014 to work for SSI Engineering, Inc. (“SSI…
