Law360: Fla. Justices Give Employers Ammo For Noncompete Fights

By September 27, 2017

Law360, Miami (September 15, 2017, 9:07 PM EDT) — When the Florida Supreme Court ruled Thursday that referral sources can be protected legitimate business interests under the state law governing noncompete agreements, it opened a door for employers to argue for the inclusion of additional interests in restrictive covenants, experts say.
In a unanimous decision, the Supreme Court said that though Florida Statute 542.335, which governs noncompete agreements, does not specifically list referral sources as subject to protection, they can be. The statute, which lists only five kinds of protected business interests, is not meant to be exhaustive, and trial courts are equipped to make case-by-case determinations depending on the facts of specific cases and the industries involved, the court said.
With this decision, employees can no longer swat away a suit to enforce a noncompete agreement by arguing that referral sources are not protected, and companies can argue that not just referral sources may be protected, but other types of business interests not listed in the law can be part of a noncompete contract.

Michael Landen, an employment litigator at Kluger Kaplan Silverman Katzen & Levine PL, said the two cases involved had a “clearer fact pattern than most” and wasn’t sure whether the decision would extend beyond referral sources in the noncompete litigation space, though for those who defend employers in these cases, it is a helpful tool to use.
“The language that the court uses in the opinion in the analysis can always be the kind of thing that can be helpful in another case that an employer might rely on,” Landen said.
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