Court, Applying Pennsylvania And California Law, Declines To Enjoin Alleged Violation Of Worldwide Non-Compete

25 06 2015

A non-competition covenant prohibited employees of Adhesives Research (AR), a company based in Pennsylvania, from performing services for a competitor of AR anywhere in the world for two years after termination. Newsom, AR’s western U.S. manager of medical products, worked out of her home in California. When she quit and joined another adhesives manufacturer, AR sued and moved for entry of a preliminary injunction. The court denied the motion.

Status of the case. The covenant contained a Pennsylvania choice of law provision and mandated that litigation be filed in that state. Responding to the motion, Newsom argued that Pennsylvania law was inapplicable and asserted that California law applied. It is less friendly to employers. The court concluded that the worldwide geographic scope was overbroad under both states’ legal principles, that blue penciling was impermissible because of AR’s unclean hands in attempting to enforce an oppressive covenant, and that in any event the new employer did not compete with AR. Adhesives Research, Inc. v. Newsom, Civ. No. 1:15-CV-0326 (M.D. Pa., Apr. 13, 2015) (Caldwell, J.).


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