VAZQUEZ HELDMAN
  • Home
  • Areas of Practice
    • Business Law & Litigation
    • Construction, Real Estate & Development
    • Healthcare and Pharmacy Law
    • Wills, Trusts, Estates and Administration
  • Contact
  • Blog and Legal Updates

Legal Updates

Non-Solicitation Covenant Found Not Applicable to New Company

12/4/2020

 
The Appellate Division, in an unpublished opinion, reviewed a challenge by a company seeking to enjoin an ex-contractor from soliciting business from a specific third-party client. The contractor ceased working with the company in 2016 and was precluded by contract from soliciting business from former clients. In 2017, the parties were ensconced in a legal suit seeking to prevent competition. At that time the parties came to an enforceable agreement regarding the ex-contractor's ability to solicit former clients and created a list of untouchable clients. To note, there was no language concerning any clients "successors and/or assigns."  
 
Between 2016 and 2018 one third-party client merged with another unrelated entity. This entity reorganized its internal governance, the IRS issued it a new tax identification number, though the business office address remained the same, and, important to the facts of this case, new account numbers were issued to this new entity for its electric service. In addition, this merged entity was not named as a former client in the settlement agreement.
 
The trial court held that the parties' prior settlement agreement did not include this new entity and that the ex-contractor could contact and solicit business from it. The Appellate Division agreed and upheld the trial court's decision relying on the facts that the merged entity reorganized its internal governance, was issued a new tax id from the IRS, was assigned new account numbers for electric service, and the parties' settlement agreement did not specifically include former clients and their "successors and/or assigns." A court must not rewrite an agreement to create more favorable terms for one party.  Capital Energy Inc. v. MT 


Comments are closed.

    Authors

    Peter J. Vazquez, Jr.
    Jeffrey Heldman

    Archives

    March 2023
    February 2023
    January 2023
    December 2022
    August 2022
    April 2022
    March 2022
    February 2022
    January 2022
    July 2021
    April 2021
    March 2021
    February 2021
    December 2020
    June 2020
    May 2020
    April 2020
    February 2020
    January 2020
    December 2019
    November 2019
    October 2019
    September 2019
    August 2019
    July 2019
    June 2019
    May 2019
    April 2019
    March 2019
    February 2019
    January 2019

    Categories

    All
    Business Law
    Construction Law
    Consumer Fraud Act
    Healthcare Law
    Land Use & Zoning
    Real Estate Law

    RSS Feed

Peter J. Vazquez, Jr.
pvazquez@vazquezfirm.com

Office Phone
973-434-7062

Jeffrey Heldman
jheldman@vazquezfirm.com

​Copyright © 2017-2023    ​
  • Home
  • Areas of Practice
    • Business Law & Litigation
    • Construction, Real Estate & Development
    • Healthcare and Pharmacy Law
    • Wills, Trusts, Estates and Administration
  • Contact
  • Blog and Legal Updates