Atlanta Restrictive Covenants Non-Compete Agreement Lawyer
Employees and employers, as well as companies doing business with each other, often enter into agreements which contain restrictive covenants, or promises to limit or avoid certain activities during and after a business relationship. There are several types of restrictive covenants, but the most common are agreements not to compete or solicit customers or employees, and agreements to protect trade secrets or other confidential information.
Non-Compete Provisions in Georgia
Georgia law—specifically, the Georgia Restrictive Covenants Act, O.C.G.A. § 13-8-50 et seq.—generally respects restrictive covenants as long as they are reasonable. Non-competes must be reasonable in terms of the geographic area or distance in which an employee is not allowed to compete, as well as the scope of restricted activities and the length of time the non-complete applies. For example, a non-compete that prevents an employee from competing with their former employer anywhere in the world will likely not be enforceable. But if a non-compete only bars the former employees from engaging in specific competing activities within a limited area and for a limited period of time, Georgia courts can presume the non-compete reasonable. In such a case, the burden shifts to the former employee to demonstrate that it is nevertheless an unreasonable restraint.
Georgia law permits, but does not require, courts to modify a restrictive covenant that is otherwise void and unenforceable, so long as the modification does not render the restrictive covenant more restrictive. However, Georgia courts apply the “blue pencil” method, which means that they may, but need not, strike out unreasonable terms in an overbroad non-compete. But they will rewrite restrictive covenants to include reasonable limitations that do not exist. Whether you are a business or an employee, you should consult with an attorney if you believe a non-compete in your contract may be overly broad or otherwise unenforceable.
Non-solicitation agreements restrict one party from soliciting the other party’s customers, prospective customers, vendors, or suppliers. Some non-solicits prevent a former employee or business partner from soliciting the other party’s employees to leave and work for them.
However, just as with covenants not to compete, covenants not to solicit must be reasonable. For a former employee, any non-solicit agreement lasting less than two years is presumed to be reasonable. For other individuals and companies, the presumption of reasonableness may extend to three years or five years, depending on the kind of business relationship at issue. Georgia law does permit non-solicit agreements against former employees, and they may even be valid without an express geographic limitation. However, non-solicits must nevertheless be reasonable and courts will narrowly interpret these provisions to apply only to customers or prospective customers with whom the employee had “material contact” or products or services that are competitive with the former employer’s business.
Trade Secrets and Confidential Information in Georgia
Trade secrets are business information which is not commonly known by or available to the public, is valuable because it is not commonly known or easily learned, and which a person or a business attempts to keep secret as a result. Trade secrets include the kind of business information that a company would usually keep secret—like a list of potential customers or the secret formula for Coca-Cola®, but may also be any kind of technical or non-technical data, patterns, compilations, programs, devices, methods, techniques, processes, or plan. The Georgia Trade Secrets Act of 1990, O.C.G.A. 10-1-760 et seq., makes misappropriation of trade secrets unlawful and authorizes claims for injunctive relief and damages, as well as attorney’s fees and costs of litigation.
Confidential information includes trade secrets, but also anything a contract defines as confidential and therefore protected. Contracts with restrictive covenants often define confidential information specifically and prohibits parties who obtain confidential information from one person or company during a business relationship from using that confidential information in later employment relationship or business venture. In Georgia, restrictions on the disclosure or use of confidential information may last indefinitely, as long as the information remains confidential.
Atlanta Non-Compete and Trade Secrets Attorneys
Disputes involving restrictive covenants may be complex, requiring evidence relating to specific types of businesses, products and services available in the market, and other specialized data. Effective advice and representation in this area requires not only knowledge of the law but also the ability and willingness to drill down on the details of business arrangements, investments, and the needs of parties to these kinds of contracts. The attorneys at Beal, Sutherland, Berlin & Brown have the expertise in both employment and business law to advise our clients effectively on restrictive covenants and litigate these disputes. If you need advice or representation relating to restrictive covenants, contact us today for a free consultation.