In the Spirit of Competition

On Behalf of | Mar 8, 2013 | Business and Commercial Law |

It’s tournament time in Minnesota, and that reminds me how much we relish competition. Sports, music, television and movies all compete for ratings and rewards. Even Aunt Sally’s choke cherry jam might win a blue ribbon at the county fair. And in business, we have many laws designed to foster competition.So, how do “non-compete” agreements fit in our otherwise competitive business environment? Non-competes are agreements that prevent one party from competing against the other party. They are sometimes made between an employer and an employee when the employer does not want the employee to leave, take what s/he learned on the job, and then use it to the employer’s disadvantage with a competitor. They are also used when the buyer of a business does not want the seller to go into competition after the sale. Because non-competes restrain trade, they are disfavored in Minnesota. However, they are enforceable if they are reasonable. Typically, this means that the courts will consider the duration, geographic scope and overall restrictions in the agreements before deciding whether they are reasonable. The courts will also consider whether the non-competes are part of bargained for deals between the parties; if not, the courts will throw them out. Even in our competitive business world, non-competes can be useful tools. For more information, stop in or call us at (320) 763-3141.