THE AMOEBA DEFENSE TO NONCOMPETES
Lets go back to middle school science for this one. Do you remember what an “amoeba” is? How about a a genus of protozoa (cells) that moves by means of pseudopods. Enough science…but how is this connected to defending against unfair and restrictive noncompete agreements?
The connection is provided by the Henrico County Circuit Court decision in Lawrence v. Business Communications of Virginia, Inc. In that case, Business Communications made its employee sign a noncompete agreement which prevented the employee from working in the business of selling cellular phones, pagers, and long distance service for a period of 2 years within 50 miles of any business location operated by Business Communications. The “twist” in this noncompete agreement is that it provided the agreement would remain in full force and effect during the employee’s employment with Business Communications and for a period of 2 years after the termination of the employer-employee arrangement.
The court found the agreement to be overly broad and unenforceable. Why? Because by its terms the geographical area could potentially grow like an “amoeba” after the termination of the employment arrangement. In other words, the employee could work in an area outside of the 50 mile radius today but tomorrow (and within the two year period) Business Communications could open a new store and prevent the employee from working in what yesterday was an acceptable location.
My Take: This decision (rarely noted or discussed) may wreak havoc with most noncompete agreements!