Recently, the First Circuit federal appeals court ruled that Massachusetts law would not draw a hard and fast line between active solicitation and merely accepting business. The specifics of the case are familiar: employee/sales representative signs a non-solicitation agreement prohibiting solicitation, diversion or enticement of employer’s customers or business. Employee leaves and sends a permissible email blast announcing his new employment relationship. The blast is directed to prospects, almost half of which were former employer’s customers. Some of the recipients contact former employee and ultimately enter a sales relationship with the new company. The employee argued that the new relationships were permissible since he did not technically initiate the contact. The Court strongly rejected this argument, stating that “[o]ne could more readily believe in the Tooth Fairy than believe that this course of conduct was insufficient to ground a finding of [impermissible] solicitation.” The Court emphasized the complex nature of the sales process at issue here, implying that initial contact in the context of sales involving off-the-shelf goods might be given more weight.
For employees: Semantics will not carry the day.
For employers: Why take a chance? Draft non-solicitation clauses to say what you mean.