Texas Lawyer: Get Smart About Non-Competes
Texas Lawyer has signed up Alan Bush as a freelance contributor. His latest article, “Get Smart About Non-Competes,” appeared in the In-House Texas pullout on April 1.
Here’s what Alan had to say about respecting a competitors’ legitimate trade secrets and non-competes:
In-house counsel should keep their eyes peeled for other market players’ noncompetition agreements. Understanding how noncompetes work can bolster the company’s efforts to recruit the skilled, experienced employees that other companies in the industry can’t retain. A shrewd legal department develops a reputation for respecting competitors’ legitimate noncomptes while aggressively fending off attempts to overreach.
Noncompete agreements come in a million flavors. Some have global restrictions that last for years. Others are narrow and short. Some nonsolicitation agreements only protect a competitor’s existing client base, leaving the rest of the market wide open. There’s no telling what a candidate’s employment agreement says until in-house counsel reads it…
Read the full article for more. In it, Alan lays out some practical steps on how to:
- Ask job candidates for their non-competes and defensively document what you’ve seen;
- Evaluate a competitor’s non-compete agreement; and
- Manage the risk of your competitor filing a trade secret enforcement action.
Labor Takes a Big Hit
The NLRB has handed down boatloads of pro-union decisions since President Obama appointed three members to the NLRB while Congress was in recess. The decisions are now in serious question. Reset button, anyone?
The D.C. Court of Appeals just ruled that the President’s recess appointments violated the Constitution. That nails three members of the five-member board, which deprives it of a quorum. Expect the NLRB to appeal to the Supreme Court.
Unless the Supreme Court reverses course, all those pro-union NLRB decisions could get tossed into the waste basket. The NLRB had stepped into the mix on some sensitive issues like:
- Arbitration class action waivers
- Social media
- Witness statements
- Bargaining unit gerrymandering
Stay tuned.
Upcoming Seminar for The Woodlands Bar Association
Alan Bush often speaks at seminars for business leaders—such as line executives, finance executives, human resource professionals, CPA’s and lawyers. You can hear Alan at:
Woodlands Bar Association | CLE Luncheon
Forward HR Intelligence: Get There First
February 7, 2013
Think like the other side. Expose how plaintiff’s lawyers, government enforcers or competitors can exploit weak spots in a company’s HR systems created recently by courts and regulators. Then fix it. We’ll talk it out—all the way from retaliation claim ambush, to non-compete agreements, to the juiciest overtime lawsuit trends. Hear it straight from an ex-plaintiff’s lawyer, turned 100% company man.
Where: Jasper’s
When: 11:45a – 1p
Embezzlement Is Old School
Data theft is a company’s biggest weakness to fraud—beating out embezzlement for the top spot. That’s according to the US senior executives who were surveyed for the Global Fraud Report issued by Kroll Advisory Services. You can find the report here. And employees “are far more often to blame for the loss of information than hackers.”
Employees most often steal trade secret data to use it on their next job with a competitor. Everything from sensitive technical to business information can be vulnerable. Your competitor has no business learning your secret playbook by hiring away a key employee.
A federal jury recently convicted a former GM engineer and her husband of stealing technical trade secrets for possible use in China. Here’s the story.
Solid HR practices help keep your secret playbook out of your competitor’s hands:
- Non-compete agreements call jobs with a competitor off limits where an employee could benefit most from stealing trade secrets.
- Reasonable security measures give you the best shot at qualifying sensitive information as trade secrets.
- Exit interviews about a departing employee’s next job can help spot the folks at highest risk for trade secret theft.
- Forensic IT triage can pat down a high-risk former employee’s work computer for digital trade secret theft.
Texas Lawyer – How to Survive the Overtime Dog Pile
Texas Lawyer has signed up Alan Bush as a freelance contributor. His latest article, “How to Survive the Overtime Dog Pile,” appeared on November 5, 2012 in the In-House Texas pullout.
Here’s what Alan had to say about how to deploy limited resources to prevent and defend against an overtime collective action:
No in-house counsel wants to wake up one morning to discover the company has an unexpected and unfunded $3 million contingent liability. That can happen when a relatively small group of workers brings a collective action alleging the company owes them for overtime pay. I call these suits an overtime dog pile.
Overtime suits are common these days. People call the Department of Labor so often that the agency has a “Bridge to Justice” program that refers overtime claimants to private plaintiffs counsel. But companies and their counsel don’t have to take it lying down. Here are some steps the legal team can take to protect the business — before and after plaintiffs sue…
Read the full article for more details. In it, Alan lays out some practical steps on how to:
- Limit damages exposure by examining your pay policies before they’re challenged by the DOL or a lawsuit;
- Wisely deploy limited audit resources;
- Slice-and-dice a proposed class of overtime claimants; and
- Crunch the damages numbers right (not how plaintiffs’ counsel wants to).
Texas Lawyer – Out of the Boxing Ring, Into the Courtroom
Texas Lawyer has signed up Alan Bush as a freelance contributor. His latest article, “Out of the Boxing Ring, Into the Courtroom,” appeared in Out of Order commentary section.
Here’s what Alan had to say about what boxing has taught him about litigation:
Boxing is a contact sport, just like litigation. That’s why the boxing ring has a lot to teach trial counsel and in-house litigation managers about the courtroom.
I’ve duked it out in a lot of courtrooms, but I only recently took up boxing, and it has changed my take on litigation. Here are a few things I’ve learned.
- Respect the opponent. The quickest path to defeat in the boxing ring is to underestimate an opponent. That leads to slouching in training and bad-mouthing the other fighter. Next thing the contender knows, he’s on the mat wondering what hit him.
Humility wins bouts and trials. I always consider myself the underdog to avoid complacency…
Read the full article for more.
Tweet Rights as Trade Secrets?
Many folks use LinkedIn, Twitter and Facebook for business. When an employee leaves, what’s that social media account worth? Saying that the account password and business contacts are trade secrets, some companies have launched World War III.
Trade secrets enforcement actions over social media accounts have met mixed results. Some courts have agreed with the company; others have not.
In Texas, there may be an easier way—solid non-solicit agreements. You’re usually concerned about your company’s contacts who are customers, potential customers and vendors. A non-solicit agreement can call those contacts off limits, regardless of who owns the Twitter account.
We have written about non-solicits covering customers and potential customers here. And about vendors here.
A reasonable non-solicit, however, will eventually expire. If you’re interested in protecting the right to access the social media account and contacts as a trade secret, you may need to keep the account.
Taking a couple steps may move the ball down the field towards trade secret protection. Ask your employee to sign a social media agreement before anyone creates the business social media account. The agreement basically sets out your ownership of the account, password and contacts as your trade secrets. Then, your company creates the account and keeps a copy of the password. If the employee leaves, change the password when you cut off the employee’s other IT access.
Tread lightly here. Personal social media use is a sensitive topic. So think very carefully before you ask for a stake in your employees’ social media use. You’ve got a far easier sell if you’re talking about an account that’s business use only.
