Here at the Law Office of Vincent Miletti, Esq. and the home of the #UnusuallyMotivated movement, we take pride as a resilient and dependable legal services firm, providing such services in both a traditional and online, web-based environment. With mastered specialization in areas such as Employment and Labor Law, Intellectual Property (IP) (trademark, copyright, patent), Entertainment Law, and e-Commerce (Supply Chain, Distribution, Fulfillment, Standard Legal & Regulatory), we provide a range of legal services including, but not limited to traditional legal representation (litigation, mediation, arbitration, opinion letters, and advisory), non-litigated business legal representation and legal counsel, and unique, online legal services such as smart forms, mobile training, legal marketing, and development.

Still, here at Miletti Law®, we feel obligated to enlighten, educate, and create awareness, free of charge, about how these issues and many others affect our unusually motivated® readers and/or their businesses. Accordingly, to achieve this goal, we have committed ourselves to create authoritative, trustworthy, & distinctive content. Usually, this content is featured as videos posted on our YouTube Channel https://www.youtube.com/channel/UCtvUryqkkMAJLwrLu2BBt6w and blogs that are published on our website WWW.MILETTILAW.COM. With that, the ball is in your court and you have an effortless obligation to subscribe to the channel and sign up for the Newsletter on the website, which encompasses the best way to ensure that you stay in the loop and feel the positive impact of the knowledge bombs that we drop here!

As the authoritative force in Employment Law, it only seemed right to introduce one of the many upcoming series in which we introduce a variety of topics that looks to educate and deliver in a manner that only Miletti Law® can. In this regard, this blog is Part XVII of our ongoing series on “Trade Secret Misappropriation & Restrictive Covenant Claims.” In Part XVI, we hammered on “Obtaining Injunctive Relief; Balance of Equities in Movant’s Favor” and mentioned that often, a court might deny an employer, who would be seeking to enforce a restrictive agreement, the injunctive relief they seek to obtain. However, if the court grants the requested injunctive relief against the harm to the employer, it must weigh the potential hardship to an employee. We also added that at times, assuming that the employer seeks to enforce the restrictive covenants, the employee might have acknowledged and agreed not to contend hardship with respect to the restrictive covenant at issue. Suppose this is the case, and owing to the fact that the employee would need to continue earning a livelihood, the employee remains free to participate in particular business activities.

As a continuation of our discussion, we have hammered on the “Risk of Irreparable Harm” as another factor that determines the success or failure of obtaining injunctive relief in our blog titled “The Risk of Irreparable Harm if Injunctive Relief is not Granted” and Part XVII of the series.

Risk of Irreparable Harm if Injunctive Relief is not Granted

A court may grant or fail to grant injunctive relief based on the prong of irreparable harm to the plaintiff’s business. In this case, the employer is required to show the court that it would be in danger of severe and irreparable harm to the interests of its business, for which monetary damages would not remedy if the employee’s conduct remains unchecked. This underscores the need for employers to make sure that every employee acknowledges, during the signing of a restrictive covenant agreement, that they understand that the employer would suffer irreparable harm in the case of a threat of breach or a breach itself.

Regarding this matter, employers may draw helpful guidance from case law in the jurisdictions where they seek injunctive relief. For instance, employers within New York may satisfy the irreparable harm standard by showing the court that the loss of client goodwill or relationships or the misuse of confidential information would result from the violation of restrictive covenants. During past hearings, courts have ruled that irreparable harm that warrants granting of preliminary injunctive relief would be constituted by the loss of the goodwill of a viable, ongoing business. In another case, a court found that where the loss of goodwill is not readily quantifiable, a breach of restrictive covenants constitutes irreparable harm.

Essentially, an employer may demonstrate the prong of severe and irreparable harm by showing that it would not only suffer a dilution of the goodwill it has developed with its customers but would also lose business should the defendant(s) be allowed to engage in unfair competition by using the employer’s proprietary and confidential information. In such a case, a court would be compelled to grant an injunctive relief because irreparable harm would directly result from the loss of customer goodwill and client relationships.

In the next blog titled “Seeking Injunctive Relief; Likelihood of Success on the Merits” and Part XVIII of this series, we will discuss “Likelihood of Success on the Merits,” which is another factor that determines the success of seeking and obtaining injunctive relief.

In the meantime, stay tuned for more legal guidance, training, and education. In the interim, if there are any questions or comments, please let us know at the Contact Us page!

Always rising above the bar,

Isaac T.,

Legal Writer & Author.