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Court of Chancery Extends Noncompete Period

Posted In Business Torts

Deloitte & Touche USA LLP v. Lamela, C.A. No. 1542-VCP (Del. Ch. April 6, 2007).

Contracts not to compete upon termination of employment must contain a limit on how long they last. A "reasonable" time is permitted. However, what happens if the contract is violated? Should the time limit then be extended to make up for the violation? This decision holds that the period should be extended so that the former employer gets the full benefit of the time limit on competition.

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