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Colorado Non-Compete Law Blog

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Dan Warden

Latest from Bond & Morris, P.C.

In 2018, the rules changed for physician noncompetes in Colorado. Since 1982, physician noncompetes have been governed by a rule unique to physicians. Colorado’s noncompete statute voids “any covenant not to compete provision of an employment, partnership, or corporate agreement between physicians” that restricts the right of a physician to practice medicine. As a result of this statute, courts cannot enjoin physicians from practicing medicine – regardless of whether the physician agreed to the restriction.…
A recent decision in Denver District Court, Business Network Consulting v. Perkins, demonstrates the risks taken by aggressive employers when they seek to impose restrictions on a former employee that aren’t set forth in any written agreement. BNC, a computer consulting company, sprung into action when it learned that one of its customers had offered a job to its former employee, Perkins. BNC contacted its customer and threatened litigation even though the customer had never…
  Once the decision is made to quit and join a competitor, employees sometimes will delete information on the company laptop issued to them.  Various explanations are offered by employees for the deletions. Employees will claim that the deletions were personal photos or information. Or, that the deletions were done only after hard copies of the documents were placed in the company files. Or, that there wasn’t any information on the computer when the computer was issued…
Noncompetes are contracts, and any analysis of a noncompete starts with the language in the noncompete. Once a dispute arises, companies often learn that the language in their noncompete agreements fails to impose the obligations that they had intended. If a company then tries to enforce the agreement that it intended, rather than the agreement that was drafted and signed, courts are unsympathetic. A recent federal court case in Colorado decided by Magistrate Wang, Continental…
We are Colorado lawyers and typically don’t appear in cases outside of Colorado. Nonetheless, we monitor developments in noncompete law in other states, particularly in the states near Colorado. Those developments often expose unresolved issues in Colorado, or highlight choices made in Colorado’s noncompete statute and caselaw. In 2015, health care practitioners in New Mexico caught a break when New Mexico adopted a new statute that limits the enforcement of noncompete agreements against them. In…
In Colorado, employers often claim that noncompetes signed by salemen are enforceable because the company has customer lists and other proprietary information which are trade secrets. Employers resort to the “trade secret” exception in Colorado’s noncompete statute, because many salesman don’t have management responsibilities and the statutory exception for executive and management personnel can’t be invoked. It is true that the trade secret exception can be used by employers against salesmen or non-managers. And Colorado courts…
Ready, fire, aim. That’s how one commentator describes the mistake often made by many companies when they commence a trade secret lawsuit. What he means is that companies rush to file a lawsuit for trade secret misappropriation when an employee quits and takes a prominent position with a competitor. Immediate action seems necessary to protect the company’s trade secrets and to prevent the former employee from using and exploiting the trade secrets. In their rush to file…
A recent decision from the Bankruptcy Court in Denver examines (and struggles with) some of the many issues that arise when a person subject to a noncompete files for bankruptcy. In In re Hruby, 2014 WL 2071997, Debtor had been employed by Midwest Motors, but quit and apparently took another job with a competitor and made sales to customers that he serviced when he was employed with Midwest. There was evidence that the debtor had accessed Midwest’s computer files containing…
Recent efforts to bar noncompetes in Massachusetts have triggered a series of general interest articles about noncompetes. Earlier this month, the New York Times ran a story about how “Noncompete Clauses Increasingly Pop Up in Array of Jobs” (http://www.nytimes.com/2014/06/09/business/noncompete-clauses-increasingly-pop-up-in-array-of-jobs.html?_r=0). That article suggested that more employees were being asked to sign noncompetes and that noncompetes were being used in unexpected fields. The article began, for example, with an account of a camp counselor who was asked to…
Two recent FTC actions have confirmed once again that companies should not enter agreements to refrain from hiring each other’s employees. In 1992, Tecnica and Volkl began collaborating in the marketing and distribution of complementary ski equipment: Volkl skis and Tecnica ski boots. The companies initially were not competitive. Tecnica at that time didn’t sell skis and Volkl didn’t sell ski boots. Both companies marketed their products by securing endorsements from ski athletes, like World Cup and Olympics skiers.…