Compliance Stuff

The Massachusetts Supreme Judicial Court just clarified that non-solicitation agreements aren’t subject to the Commonwealth’s strict noncompetition law just because they contain forfeiture provisions, handing businesses a crucial win when it comes to enforcing restrictive covenants. Here’s what happened in the June 13  Miele v. Foundation Medicine  decision, what it means for your business, and what you should do now. What Happened? Susan Miele signed a restrictive covenant agreement when she joined Foundation Medicine (FMI) as an executive in 2017 . The agreement included a non-solicitation clause barring her from recruiting FMI employees for a year after her departure. When she left the company in 2020, she signed a transition agreement that incorporated the non-solicitation clause and added a forfeiture provision: if she breached the non-solicitation agreement , she would forfeit or must repay over $1 million in benefits. After leaving FMI in 2021, Miele allegedly recruit...

On April 24, 2025, the Florida Legislature passed the Florida Contracts Honoring Opportunity, Investment, Confidentiality, and Economic Growth (CHOICE) Act, significantly expanding the enforceability of noncompete laws in the state. Although Governor DeSantis has not signed the bill into law, it is expected that he will soon, and the law will be effective July 1, 2025 . Employers are encouraged to immediately review their noncompete agreements and existing practices in light of the bill’s major additions to the current legal landscape . Background In Florida, employers commonly enter into noncompete/nonsolicitation agreements with their employees to protect their trade secrets, confidential information, and relationships with prospective or existing customers. Such agreements are governed under section 542.334, Florida Statutes, which provides a list of factors that courts may consider in evaluating the agreement’s enforceability. To enforce a restrictive covenant agreement, employers...

 The Federal Trade Commission’s (FTC) ban on noncompetition covenants (“noncompetes”) could significantly impact the design and administration of employee benefits and executive compensation arrangements. Quick Hits The FTC’s ban on noncompetition covenants has potential implications for several aspects of employee benefits and executive compensation plans and arrangements, such as Code Section 457(f) plans, restricted stock, severance arrangements, golden parachute payments, and garden leave. The rule takes effect on September 4, 2024 , but a federal district court in Texas recently granted a preliminary injunction staying the enforcement of the final rule as to the parties in the case. The court’s decision, pending a final ruling on the merits by August 30, 2024, has signaled that the FTC’s noncompete rule will not survive judicial scrutiny. Although the U.S. District Court for the Northern District of Texas recently granted a preliminary injunction staying enforcement of the ru...