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Current Developments in the Commercial Divisions of the
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Posted: May 8, 2017

Short-Term, Worldwide Restrictive Covenant Enforced

On April 21, 2017, Justice Kornreich of the New York County Commercial Division issued a decision in Eagle Energy Brokers, LLC v. Stanton, 2017 NY Slip Op. 30834(U), enforcing a short-term, worldwide restrictive covenant, explaining:

Since Eagle only seeks recourse for revenue attributable to its clients for the subject three-month period, the court finds this recourse to be sufficiently narrowly tailored. A three month non-solicit is enforceable, especially here, where Stanton was entitled to be paid his base salary during this period of garden leave. While Eagle did not offer to pay Stanton a bonus during this three-month notice period, they had no obligation to do so. Courts have, in fact, permitted longer periods of customer solicitation prohibitions.

While the scope – an international non-compete – is broad, such scope is reasonable in this instance because the type of work performed by Stanton could be performed from anywhere in the world where Stanton has an internet connected computer (with access to the Intercontinental Exchange Instant Messaging System and trading platform) and a phone. A narrower scope would undermine the efficacy of the non-compete.

(Internal quotations and citations omitted).

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