The CHOICE Act: An Unprecedented Shift in the Future of Noncompete Agreements in Florida

By Luis E. Llamas on May 18, 2025 Posted in Non-Compete

The Florida Contracts Honoring Opportunity, Investment, Confidentiality, and Economic Growth (CHOICE) Act marks a significant shift in the state’s approach to noncompete agreements, reinforcing employer protections and reshaping restrictive covenants. This legislation, set to take effect on July 1, 2025, establishes a presumption that covered noncompete agreements and garden leave provisions are enforceable, making Florida one of the most employer-friendly states in the country.

For a deeper analysis of the CHOICE Act and its implications, read our full client alert on this legislation here.

AIPLA Conference on Trade Secret Litigation Recap: Part 2 – Forensics

By Thomas Hubert, Joseph Lavigne and PJ Kee on May 2, 2025 Posted in Confidential Information, Trade Secret

Our team attended the recent AIPLA Trade Secret Summit, one of the nation’s premier conferences on trade secret law. Critical issues surrounding the protection of confidential business information took center stage and we were reminded just how important it is for companies to stay ahead of the curve to safeguard against unfair competition and trade secret theft.

Several topics were key takeaways for us. We last wrote on the nuances of joint representation of an onboarding employee and the hiring company. Another key topic that should be a key consideration for companies protecting trade secrets is the theft of company information and forensics.

AIPLA Conference on Trade Secret Litigation Recap: Part 1 – Joint Representation

By Thomas Hubert, Joseph Lavigne and PJ Kee on April 23, 2025 Posted in Trade Secret

At the recent AIPLA Trade Secret Summit, one of the nation’s premier conferences on trade secret law, critical issues surrounding the protection of confidential business information took center stage. The discussions reinforced the importance of safeguarding trade secrets and proprietary data against theft, liability, and employee mismanagement—particularly during key employment transitions such as hiring, active employment, and separation. These considerations are essential for companies striving to maintain their competitive edge while navigating complex legal and ethical challenges.

Hearing firsthand how companies handle these issues reinforced just how vital it is to stay proactive and ahead of the curve. Our team has put together a series of key take aways from the event that may help companies to guard against unfair competition and trade secret theft. Our first topic for consideration is joint representation.

Joint Representation

Representing an onboarding employee and the company concerning the hiring of the individual can be a tricky proposition. There are good reasons for engaging in a joint representation with proper warnings and there are definite pitfalls.

One of those pitfalls is the appearance that the new employee and the new employer are joined at the hip relating to the conduct of the employee exiting a former employer (especially if the former employer is a direct competitor). When this situation occurs, the first step is to review the representation from an ethical standpoint under existing Ethics and Professionalism rules.

It is considered ethical to simultaneously represent multiple clients whose interests may not ultimately be aligned if the law does not prohibit the representation and if no client asserts a claim against any other client involved in the proceeding.

First things first—obtain an acknowledgement from the new employee that there is no restrictive covenant impeding the employment, the employee has exited his former company without any trade secret/confidential/proprietary information, and the employee has not destroyed or spoliated any information that belongs to the former employer.
If these factors check out, proceed cautiously with the caveat that if it is learned that the acknowledgement is false, representation of the employee will end and representation of the company will continue. In this type of situation, informing each party of the risks of dual representation is key to continued representation of the company when bad facts present themselves. This is not to say that disqualification may still occur, particularly if privileged information obtained from the onboarding employee could assist the employer in defending any claims.

A key case to review before undertaking any dual representation is Upjohn v U.S, 449 U.S. 383 ( 1981).

Ex-Schwab Employee Prohibited from Using Client Information

By Jason Culotta on February 18, 2025 Posted in Injunction, Trade Secret

In the case of Charles Schwab & Co., Inc. v. Roberto Ivan Ortega (Case No. 4:24−cv−04962), the United States District Court for the Southern District of Texas issued a Stipulated Preliminary Injunction Order on February 12, 2025.

Charles Schwab alleges that Roberto Ivan Ortega misappropriated its trade secrets and client information to solicit the business of former customers after joining a competitor. After Ortega refused Schwab’s requests to return its information, Schwab filed suit and moved for a preliminary injunction preventing the use or disclosure of its information.

Faced with the reality that a court would likely enter an injunction, Ortega’s counsel agreed to an injunction that prohibited Ortega from using, disclosing, or disseminating Schwab confidential information or soliciting Schwab customers. Ortega is also required to give Schwab access to his computing devices for Schwab to conduct discovery to uncover the scope of the misappropriation.

Courts continue to stress the need to maintain the status quo in cases involving the theft of information. Employers must take the necessary steps to prevent the theft of their information and in the cases where their information has been taken, prevent the use or disclosure of that information by filing a lawsuit and seeking an injunction.

Nuclear Verdicts Hit Trade Secrets

By Thomas Hubert and PJ Kee on December 11, 2024 Posted in Data Protection, Trade Secret

A Massachusetts federal jury awarded $452 million against a South Korean company after concluding it had stolen secrets related to a wearable insulin patch. Nuclear verdicts are determined as ones that exceed $10 million have grown over recent years.

While the recent nuclear verdicts have mainly been in personal injury situations, this highlights risks associated with theft of trade secret information. This also highlights the need to perform internal audits on protection of sensitive information. A key to protecting valuable information is taking proactive steps to restrict access to certain proprietary information, including designs of products not readily available in the public setting.

Click here to read more on this ruling.

Louisiana Court Clarifies Employee Non-Solicitation Provision Requirements

By Joseph Lavigne on November 24, 2024 Posted in Non-Compete

In a recent ruling, The Louisiana Court of Appeal, First Circuit recently ruled that an employee non-solicit/no-poaching agreement is not subject to the Louisiana non-compete statute but, nevertheless, to be valid, must have a temporal limitation that is reasonable in scope to be enforceable. Because the agreement at issue was open-ended with no temporal limitation, the court ruled it was void and unenforceable.

Employers should review and, if necessary, revise their employee non-solicitation provisions to make sure they comply with the finding in this case.

Click here to read more on this case.

Federal Judge Stymies FTC Efforts to Outlaw Non-Compete Agreements

By Joseph Lavigne and Connor Fields on August 23, 2024 Posted in Federal Trade Commission, Non-Compete

On August 20, 2024, Judge Ada Brown of the US District Court for the Northern District of Texas set aside the Federal Trade Commission’s rule that effectively prohibited the use of non-compete agreements. Interpreting the Administrative Procedure Act, which provides for judicial review of the actions of federal agencies like the FTC, the court found that the FTC’s non-compete ban was unlawful.

PA Federal Court Denies Request to Enjoin FTC Ban on Non-Competes

By Joseph Lavigne and Madison Gaines on July 26, 2024 Posted in Federal Trade Commission, Non-Compete

As previously reported, the US District Court for the Northern District of Texas issued an injunction prohibiting the Federal Trade Commission (FTC) from enforcing its non-compete ban, which is set to take effect on September 4. That ruling, however, was limited to the plaintiffs in that case. Similarly, the US District Court for the Eastern District of Pennsylvania had a request before it and denied issuing an injunction against the FTC. It found that the plaintiff, ATS Tree Services, LLC, could not show irreparable harm, but, more importantly, it also found that plaintiff failed to show a likelihood of success on its claims that (1) the FTC does not have authority to issue a nationwide non-compete ban, and (2) the FTC Act unconstitutionally delegates legislative power to the FTC. The Pennsylvania court’s decision on “likelihood of success” is at odds with the finding of the Texas district court, which is an indication that the fate of the FTC non-compete ban will likely be resolved by the federal appellate courts and potentially the US Supreme Court. The Texas district court is scheduled to issue a final decision in the case on August 30, which could negate the non-compete ban for all employers — at least until the appeals courts and the Supreme Court have a say in the matter.

If you have questions regarding the effects of these decisions on your non-compete agreements, please contact a member of our trade secret team.

Employee Monitoring and Protecting Trade Secrets in Remote Work Environments

By Joseph Lavigne and PJ Kee on July 23, 2024 Posted in Data Protection, Trade Secret

With large swaths of the workforce working remotely, some employers have growing concerns about employee productivity, as well as information security and confidentiality. In today’s remote work era, organizations face significant challenges in balancing employee monitoring with safeguarding confidential information and trade secrets. This article explores key insights and strategies for HR professionals navigating these complex issues.

Update – Status of Challenge to FTC Non-Compete Ban

By Joseph Lavigne and Madison Gaines on July 8, 2024 Posted in Federal Trade Commission, Non-Compete

As previously reported, the consolidated lawsuits challenging the Federal Trade Commission’s (FTC) non-compete ban sought a preliminary injunction and a stay until litigation is resolved concerning the FTC’s non-compete ban. On July 3, 2024, a federal judge in the US District Court for the Northern District of Texas decided that a preliminary injunction was appropriate and temporarily enjoined the non-compete ban from going into effect. It is important to note, however, that the court declined to issue a nationwide injunction to nonparties of the suit. In other words, the FTC’s non-compete ban is still set to take effect on September 4, for any employer that is not a party in the Ryan, LLC vs. The Federal Trade Commission lawsuit.