Court Of Chancery Explains Damages For Breach Of Non-compete Agreement
This decision is a landmark case on Delaware law on non-compete agreements with employees. It establishes so many new precedents that it is hard to briefly summarize. For example, it holds that it is possible to assign an employee non-compete agreement in connection with an asset sale.
Perhaps the most significant part of the decision is its discussion on how to calculate damages when an at-will employee is lured away by a competitor and then violates his non-competition agreement. Damages are not, under this decision, what the new employer won in new business with the purloined employee. Instead, how to calculate damages in such a case is much more complicated and requires a careful reading of this decision.