Tuesday, January 20, 2009

Massachusetts Court Finds Successor Company Cannot Enforce Non-Compete (Randstad Professionals v. Wilson)

I wrote yesterday regarding the law of assignment and how it pertains to non-compete obligations of employees. Though approaches vary from one state to the next, assignments of covenants not to compete are generally permitted and may even be implied if the contract is silent.

Of course, nothing precludes a contract from prohibiting assignment altogether, as a recent Massachusetts decision illustrates. In the case of Randstad Professionals v. Wilson, the defendant signed an employment contract with a professional staffing agency, New Boston Select Group, Inc., which contained an 18-month, 100 geographic mile non-compete and a customer non-solicit clause. Several years after he started, New Boston was sold to Placement Pros. In 2008, the plaintiff - Randstad - took over Placement Pros. When it became apparent that Randstad would be Wilson's new employer, he quit.

Randstad sued to enforce the non-compete when Wilson defected and joined a direct competitor. The court had little trouble denying Randstad's motion for a preliminary injunction, holding that a specific provision of the non-compete agreement provided that "Employee's obligations ... may not be assigned."


Court: Superior Court of Massachusetts at Worcester
Opinion Date: 12/26/08
Cite: Randstad Professionals US, LP v. Wilson, 2008 Mass. Super. LEXIS 405 (Mass. Super. Ct. Dec. 26, 2008)
Favors: Employee
Law: Massachusetts

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