When a business owner must enforce a noncompete agreement

| Apr 1, 2021 | Business Litigation

Despite all initial good intentions, business partnerships do not always last. In your situation, your partner decided to leave the company. You checked your partnership agreement, wished him well and said “goodbye.” However, something did not sit right with you. You just had a feeling because you thought that your alliance was a strong one that would last much longer.

You and your partner relied on each other, brought different strengths and built a business that had a steady group of clients. But, months later, you discover your former partner has joined another company and leads a news division that has many similarities to your business. This happened despite a noncompete agreement being in place.

Consider legal action right away

You do not wait around to see how your former business partner’s actions will affect your business. It is time to take immediate action, and your former partner must understand the legal consequences he likely faces. Here are some matters to consider and pursue:

  • Carefully review the noncompete agreement. You especially want to make sure that it is enforceable.
  • Contact an experienced business law attorney, who will review the details of your partnership and noncompete agreement and provide certain legal options. Filing a lawsuit against your former business partner is an option. If you pursue a lawsuit, do not hesitate, though. A delay could lead the court to potentially waive your right to apply the noncompete agreement.
  • Understand that a lawsuit is costly as well as time-consuming. Do you want to pursue this route if you know that it would have financial ramifications on your business? However, a lawsuit may get results. Not only should you sue your former partner, but the company he joined as well.

Your business partner’s departure may have been unexpected. But his intentions to sabotage your business were in plain view after he joined another firm. Having a noncompete agreement in place could prevent any negative scenarios from surfacing.