Posted on September 14, 2010 by Angelo Tartaro

When is a non-compete not a non-compete?

…Perhaps when it’s filed in California, as we’ll soon learn.

Last week, technology giant Hewlett-Packard Co filed a lawsuit in California court against ousted CEO Mark Hurd, alleging breach of contract and threatened misappropriation of trade secrets.   Hurd, the former head of HP, recently accepted a job as co-president of Oracle, a chief rival. 

 

According to the Associated Press, the lawsuit claims that Oracle hired Hurd “to help steal business from HP.” HP claims that Hurd will inevitably disclose HP's trade secrets and violate the HP confidentiality agreement.

 

As the Wall Street Journal points out, Hurd agreed to abide for two years by Section 7 of his confidentiality agreement which states that “I will not provide services to a Competitor in any role or position (as an employee, consultant, or otherwise) that would involve Conflicting Business Activities.”

 

Confidentiality agreements are common, especially in technology fields. A key element not necessarily in HP’s favor is that they filed suit in California Supreme Court.   Non-compete clauses haven’t traditionally been easily enforced in California. Their courts have ruled “inevitable disclosure” as being an insufficient cause of action. There must be a threat of misappropriation of trade secrets made overtly by the former employee, or an actual misappropriation of trade secrets by the former employee.

 

Mr. Hurd’s case is both interesting and unusual because it involves a senior executive position and we can expect HP to claim the most detailed confidential information about the company is carried in his head.

 

The more usual experience - - in our own Connecticut and New York practice - - is that non-competes have to be reasonable as to time and geographic area.  Confidentiality agreements can’t prohibit disclosure of what is commonly non-confidential.  But, what we’ve seen is that they are more and more comprehensive even for middle managers. You usually can’t get a severance package without the non-compete and confidentiality agreements.        

 

Speaking of severance packages, Mr. Hurd’s is estimated to be somewhere in the neighborhood of the $40 million mark. 

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Posted on March 2, 2010 by Beverley Rogers

Build a Better Mousetrap - or a Safer Hot Dog

Last week, we posted about confidentiality agreements, referencing a recent case involving English muffins.

Now hot dogs are the hot topic.

The American Academy of Pediatrics released a policy statement this month, reporting that hot dogs cause about 17 percent of food-related asphyxiations in children. The Academy is proposing that hot dogs be redesigned to prevent choking.

For those caregivers who do not cut their children’s food into safe-sized pieces, or heed choking warnings, this is a life-saving solution. However, according to Eric Hummel of Hummel Brothers Meat Products in New Haven, Connecticut, “it would be virtually impossible to make [a hot dog] in really any other shape.” If it could have been done, it probably would have by now.

But if a food scientist did discover how to bypass the grinding-emulsifier-casing process, the new design would undoubtedly involve confidential, proprietary information. Yes, anyone can try to duplicate a new shape. But the process for producing the shape could be proprietary and subject to confidentiality agreements or to other protections for intellectual property.

In the meantime, Mr. Hummel recommends that families with young children purchase skinless hot dogs in the thinnest form.

There are other solutions for small children: alternative foods like eggs, sliced turkey, whole grains…. But, being lawyers and not dietitians, we have to leave the matter to individual adults to decide, including those who "relish" their hot dogs.

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