Non-Compete for Software developers.

I am a software developer and was hired by Company A to work as a contractor for a client in the Bellevue area.
Since Company A did not do H1B visas, they referred me to company B. So I am an empoyee of Company B working at the client through Company A.
I want to know if my non-compete aggreement with Company B is valid if :-
1. I leave company B
2. I continue to work for the client through another company C.

Here's the details of the non-compete clause:-
During the time that you work for the Company until 1 years following the termination of your employment for whatsoever reason (which time period shall be extended by the length of time during which you are in violation of this paragraph), you shall not directly or indirectly solicit the business of (or otherwise deal in a manner adverse to the Company with ) or provide any software engineering, consulting or programming services to any customer or end users of any customer ( on an entity-wide basis and not merely on a site or project specific basis) of the Company for which or whose benefit you provided services or were associated during your employment with the Company.

Thank you. Time is of essence.

1 answer  |  asked Aug 21, 2008 5:32 PM [EST]  |  applies to Pennsylvania

Answers (1)

Christopher Ezold
The noncompete may bar you from working for the employer's client, unless the client left first.

Before I respond to your inquiry, I must state that we have not spoken, I have not reviewed the relevant documents and facts, and I do not represent you. Therefore, my discussion below is not a legal opinion, but is informational only. Finally, my discussion applies only to issues to which Pennsylvania or Federal law apply, unless otherwise specified.

That being said, the noncompete may bar you from working for the employer's client, unless the client left first. Noncompetition agreements require that the employer have a 'legitimate business reason' to enforce them. If the client no longer wishes to do business with your employer for reasons entirely unrelated to you, then there may be no 'legitimate business reason' to prevent you from working there. This argument may be an issue of first impression in many jurisdictions, but has precedential support. If, however, you cause the client to leave, or if there are other 'legitimate business reasons,' such as your possession of trade secrets or receipt of special training from the employer, then you may be barred.

The upshot is, the situation is very fact-dependent.

If you would like to discuss this matter further, please feel free to contact me at the below address(es) or number.

/Christopher E. Ezold/
Nancy O'Mara Ezold, P.C.
One Belmont Avenue,
Suite 501
Bala Cynwyd, PA 19004
(610) 660-5585

posted by Christopher Ezold  |  Aug 25, 2008 10:37 AM [EST]

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