In the recent RE/MAX of New England, Inc. et al. v. Prestige Real Estate, Inc. et al decision, the U.S. District Court gave further pause to parties intending to enforce their non-compete clause.
In the case at hand, the plaintiff parent company was intending to prevent the defendant from competing in its market after leaving RE/Max for several specific reasons that were not contested.
The court, however, cited to the Lombard Medical Technologies decision, whereby the court had indicated that they will not enforce non-compete provisions if the result is simply to limit ordinary competition. The court determined that certain protected interests, such as the need to protect confidential information, trade secrets, and good will must be in play, citing to the Boulanger v. Dunkin Donuts decision. The plaintiff in the Boulanger decision signed documents acknowledging the, ‘proprietary and confidential nature of the information he was acquiring.’ Boulanger, in other words, had gained information regarding operating manuals, recipes, marketing and promotional strategies, new product development and the location of future stores.
As all of these protected interests were lacking in the RE/MAX case, the court found for the defendants, thereby further accentuating the importance of not simply relying upon a, “cereal box”-type non-compete
