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Non-Compete Agreements

Non-compete agreements restrict the ability of a person to work in a related business or technical area for a set period of time and in a designated geographic area. Businesses use non-compete agreements to prevent or eliminate competition from employees with access to trade secrets, confidential research information, confidential marketing plans, and customer lists or other information that would give the employee an unfair advantage.

When evaluating a non-compete agreement, an attorney looks to the law that is to be applied to govern the agreement. Typically, the law that governs is the state where the business is located; but, it can sometimes be a different state law if specified in the agreement, and not prohibited by law.

As a general rule, a non-compete agreement must be reasonable in terms of its limitations on a person. A court will not enforce an agreement that is unreasonable. Courts examine the reasonableness of the period for enforcement of the agreement, and/or the geographic limitations to restrict a person’s employment. Other factors considered in evaluating the reasonableness of the agreement are the compensation provided to the employee in the agreement, the pace at which technology or information becomes outdated in the industry, and the responsibilities of the person being barred from competition. Altera’s attorneys are available to review, evaluate, prepare or revise a non-compete agreement to achieve a your aims consistent with the law.