BUSINESS CONSPIRACY ACT CASE REPORT
The more we handle noncompete and nonsolicitation cases for employees the more frequently we see situations in which the employer makes additional allegations and pursues additional legal remedies against departing workers.
The most recent example of this trend comes from a case filed in Alexandria, Virginia, Perot Systems Government Services, Inc. v. 21st Century Systems, Inc., et al. Perot Systems alleged (and proved) two former employees, while still working for Perot Systems, copied confidential electronic information and worked with two principals of 21st Century to recruit Perot employees and transfer Perot business to a new division of 21st Century.
The lawsuit alleged breach of fiduciary duty, aiding and abetting breach of fiduciary duty, breach of a non-disclosure agreement, breach of a non-solicitation agreement, tortious interference with contract, violation of the Virginia Computer Crimes Act, violation of the Virginia Business Conspiracy Act, and violation of the Virginia Trade Secrets Act…among other allegations.
The Result: After seven days of trial and two days of deliberations, the jury returned a verdict in favor of Perot Systems in the amount of $12,900,000. That’s a hell of a lot of money!
The Lesson: Departing employees need to understand the legal ramifications of their departures and actions BEFORE they leave their employer and start working for a competitor.