Oklahoma Non-Compete Agreements

Non Disclosure and Non Compete Agreements

The ties that bind us.

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Thursday, January 27, 2011

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The Law


•A. A person who makes an agreement with an employer, whether in writing or verbally, not to compete with the employer after the employment relationship has been terminated, shall be permitted to engage in the same business as that conducted by the former employer or in a similar business as that conducted by the former employer as long as the former employee does not directly solicit the sale of goods, services or a combination of goods and services from the established customers of the former employer.

The Law



The Law



•B. Any provision in a contract between an employer and an employee in conflict with the provisions of this section shall be void and unenforceable.

The Law




The Law




Title 15 O.S. sec. 291A.

The Law


A couple of exceptions . . . .One who sells the goodwill of a business may agree

Partners may, upon or in anticipation of a dissolution of the partnership

Partners may, upon or in anticipation of a dissolution of the partnership, agree that none of them will carry on a similar business within a specified county and any county or counties contiguous thereto, or a specified city or town or any part thereof.


NON COMPETE VS. NON DISCLOSURE

Protecting Investment

vs.

Protecting Information


WHILE A NONCOMPETE IS PROBABLY NOT

ENFORCEABLE . . .

reasonable NON DISCLOSURE PROVISIONS USUALLY are ENFORCEABLE, in the employment setting and elsewhere


NON DISCLOSURE A non-disclosure agreement, also known as a confidentiality agreement, confidential disclosure agreement, proprietary information agreement, or secrecy agreement, is a legal contract between at least two parties that outlines confidential material, knowledge, or information that the parties wish to share with one another for certain purposes, but wish to restrict access to by third parties.


http://en.wikipedia.org/wiki/Law


http://en.wikipedia.org/wiki/Contract


http://en.wikipedia.org/wiki/Party_%28law%29



there are unilateral NDAs, many of the same principles apply










for instance, when a company wants to disclose a product for review prior to release










for instance, when a company wants to disclose a product for review prior to release

or to allow use of a company’s information








SAMPLE LANGUAGE


SAMPLE LANGUAGE

Non-Disclosure. Except when directed in writing to do otherwise by Employer, and except as required by law, court order or subpoena, Employee shall keep confidential and shall not divulge to any other person or entity, during the term of this Agreement or at any time thereafter, any Confidential Information.



“Confidential Information” means proprietary business information, Trade Secrets and/or other confidential information regarding Employer or any of its clients, including, without limitation, attorney/client communications which (i) have not otherwise become public knowledge, (ii) were not already known to Employee or learned by Employee from independent and unrestricted sources prior to the Effective Date, and (iii) have not been disclosed by Employer to others without substantial restriction on further disclosure. “Trade Secrets” means any proprietary information not generally known in the industry in which Employer or its clients are engaged or may become engaged, including, without limitation, information relating to Employer’s or its clients’ business affairs, finances, properties, methods of operation, software developed by Employer or its clients, submission and proposal procedures of Employer, Employer’s client or contact lists, commercial information supplied to Employer by Employer’s clients, and other confidential information respecting the business or affairs of Employer or its clients. Employee acknowledges and agrees that the business and good will of Employer depends upon its keeping such Confidential Information confidential.


POINT OF CLARIFICATION

Calling information a “trade secret” does not make it so, there is a specific definition of “trade secret” under Oklahoma law:

"Trade secret" means information, including a formula, pattern, compilation, program, device, method, technique or process, that:





a. derives independent economic value, actual or potential, from not being generally known

to, and not being readily ascertainable by proper means by, other persons who can obtain economic value from its

disclosure or use, and





a. derives independent economic value, actual or potential, from not being generally known

to, and not being readily ascertainable by proper means by, other persons who can obtain economic value from its

disclosure or use, and

b. is the subject of efforts that are reasonable under the circumstances to maintain its secrecy.


PARTICULAR AREA OF CAUTION


PARTICULAR AREA OF CAUTION

Agreeing to an NDA and then living to regret it . . . because your business is restricted


THE OVERLY BROAD NDA

Click


What if there is not a written agreement?

Policy ManualTrade Secretstortious interference with business/contract


What can an Employer do?


A level of specificity and solid definition of what is covered is protection for both sides


THOUGHTS FOR EMPLOYERS



Make confidentiality agreements a matter of standard practice







Keep the agreements as uniform as possible









Be reasonable in your demands; its easier to enforce




THOUGHTS FOR EMPLOYEES



➡Consider the impact of an agreement on outside activities







➡be aware of the obligations you will have post employment/contract









➡Do not put yourself in a compromising situation





➡Do not put yourself in a compromising situation


If it looks bad and feels bad it might be . . . bad


IF YOU WANT TO CONTACT ME. . . .


IF YOU WANT TO CONTACT ME. . . .

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405.562.7371




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Oklahoma Non-Compete Agreements