Non-Compete
Protections Beyond
State Borders:
“You Can, Can, Can!”
Presented by:
Anthony Haller, Blank Rome LLP
Myths About Non-Compete Agreements:
“You Can’t Can’t Can’t”
Myth Number 1: All Non-Competes are Difficult to
Enforce
The Facts: You “Can Can Can” Enforce a Narrowly
Tailored Non-Compete Agreement
In Pennsylvania Non-Competes are Enforceable if They Are:
 Supported By Consideration
 Narrowly Tailored
 Protect Legitimate Business Interests
Maximize Chances of Enforceability with Careful Drafting
• Acknowledgement of
Legitimate Interests
• Consideration
• Appropriate scope
• Fee-Shifting
•
•
•
•
Remedies (including extension)
Third-Party Beneficiary/ Assignment
Severability/Material Breach Waiver
Choice of Law & Forum
Myth Number 2: Non-Competes Beyond State
Borders are a Non-Starter
X
X
The Facts: You “Can Can Can” Enforce NonCompetes Against Employees Nationwide
With an effective choice of law
and forum clause, employers
based in Pennsylvania can bind
employees nationwide to the
favorable law and forum of
the company’s primary
business operations
Legal Developments Affecting Enforceability of NonCompetes in Hostile Jurisdictions
Choice of Law
 Under Restatement (Second) Conflict of Laws
s. 187, Choice of Law Clause will be applied if:
(1) “The particular issue is one which the
parties could have resolved by an explicit
provision in their agreement directed to
that issue”
(2) The chosen state has a “substantial relationship to the parties or
the transaction,” and its law is not “contrary to the fundamental
policy of a state which has a materially greater interest”
 Pennsylvania, New York, Massachusetts, Michigan, Oregon,
Washington, and Kansas all enforce choice of law clauses in noncompetes with employees nationwide, albeit for different reasons
Legal Developments Affecting Enforceability of NonCompetes in Hostile Jurisdictions (Continued)
Choice of Forum
 Atlantic Marine Construction Co., Inc. v. U.S.
Dist. Ct. (2013): Must honor exclusive forum
non-selection clauses
 Applies to declaratory actions filed in noncompete cases (see, e.g., Trosper v. Synthes
USA Sales, LLC)
 Can still obtain favorable forum even in the
absence of exclusive forum selection clauses
(see, e.g., Harrison v. Synthes USA Sales, LLC)
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