Enforceability of non-solicitation clauses – beware
Sellors have successfully defended commercial clients in the High Court recently in a claim for alleged breach of a non-solicitation clause in an employment contract. The Plaintiff sought damages and an injunction to stop alleged solicitation of business and use of confidential information. It was alleged that by virtue of a mass exodus of customers to its former employees’ new company there was active and targeted solicitation of business. Importantly, there was no non-compete or non-dealing clause contained in the employee’s employment contract.
Relying on UK authorities, Sellors argued that the burden was on the Plaintiff to provide evidence of actual persuasion or encouragement and it could not be inferred that a solicitation had occurred merely on the basis of loss of customers. The case highlights the importance of evidence in cases of alleged breach of restrictive covenants and serves as a timely reminder to employers to regularly review their restrictive covenants to ensure maximum protection.
Ronan Hynes – Partner
Litigation & Dispute Resolution
Keating Connolly Sellors