QUESTION: WHAT IS BLUE PENCILING AND WHAT DOES IT HAVE TO DO WITH NONCOMPETES?
ANSWER: “Blue penciling” is a legal term of art which applies to the discussion of the enforceability of a noncompete agreement and here is how it works. If the employer writes a noncompete contract which states the ex-employee cannot work anywhere in the world for 10 years…the agreement is clearly overly broad and no Virginia court would ever enforce it.
The concept of “blue penciling” comes into play when the employer asks the court to “modify” or “change” the terms of the noncompete which it drafted in order to make it legal and enforceable…say making the noncompete applicable to a 25 mile radius and lasting for 1 year.
Virginia courts have consistently refused to “blue pencil” noncompete agreements. The courts correctly reason the employer drafted the noncompete agreement and it is up to the employer to get it right…..without the court’s subsequent assistance redrafting the agreement to get it right.
Some employers (and their attorneys) argue that Virginia courts have the inherent power and authority to redraft (“blue pencil”) the agreements to make them valid.
I am happy to report that Virginia’s refusal to “blue pencil” noncompete agreements was again recently affirmed by a federal court in Alexandria in the July 15, 2010 decision in BP Products v. Stanley, 2010 U. S. Dist. Lexis 771177.