Courts and state legislatures continue to take aim at post-employment non-competes. In a companion blog, we recently detailed the Federal Trade Commission’s proposed rule banning post-employment non-competes. However, for years (and even under the FTC’s overreaching proposed rule), non-competes in the sale of business context have generally received less scrutiny.Continue Reading Buyer Beware: Delaware Declines to Enforce Sale of Business Non-Compete
Illinois recently passed legislation amending the Freedom to Work Act (the “Act”), following a growing trend of states imposing greater restrictions on employers’ use and enforcement of non-competition and non-solicitation covenants.
Continue Reading Illinois Imposes New Restrictions on Non-Competes and Non-Solicits
On August 13, 2021, Governor Pritzker signed into law a bill amending the Illinois Freedom to Work Act governing restrictive covenants and non-competition agreements. On May 30, 2021, the Illinois General Assembly passed a bill codifying existing noncompete law in some respects and modifying it in others. We detailed the Bill in a prior blog here. The Bill is now the law. The amendments become effective on January 1, 2022 and will not apply retroactively.
Continue Reading Illinois Governor Signs Non-Compete Legislation
The protection and retention of confidential information and trade secrets permeate nearly every transaction. Employment-law successor liability presents a substantial risk in transactions even when purchase agreements seemingly contain protective language. The general rule that an asset buyer does not assume a seller’s liabilities does not necessarily apply in the employment context, at least not in all cases. Targeted labor and employment diligence helps to identify potential areas of post-acquisition risk. Diligence also helps foster a greater understanding of the seller’s business and its workforce, making for a smoother post-acquisition integration effort. Identifying key underlying trade secrets and efforts to safeguard those trade secrets leading up to the transaction, and ensuring appropriate agreements are in place post-transaction to protect such trade secrets, are critical elements to the due-diligence process.
Continue Reading The Critical Nature of Employment and Trade Secret Diligence in Corporate Transactions