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Do I have any recourse/options for getting around a non-compete clause within a direct sales/party plan agreement that I signed?

Fenton, MI |

I was an independent consultant with a party plan company. The agreement/contract that I signed stated that for a period of 18 months after terminating my agreement with them that I would not "engage in similar sales of products offered for sale by my previous company." Out of ignorance, I attempted to do so and rec'd a certified letter from my previous company warning me to immediately cease and desist. There is currently only four months left before reaching the 18 month deadline. Do I have any options other than waiting out the four month time period? Also, would I be within the confines of this agreement if I were to sign with a company that sells a wide variety of products which includes just a few products that are similar to what I sold with the previous company? Thank You

Attorney Answers 3


This seems to be a contract issue. The general rule in Michigan is that 2 sides are free to contract as they choose, and are assumed understand the plain meaning of the contract they make. Unless the contract is "unconscionable" it is usually enforced as written. I think you would have a hard time being able to do anything which is substantially similar to the practices covered by the contract. It maybe that your current employer won't care if you engage in a minor amount of a similar sales. However, it is also likely that the employer has substantially more resources than you to engage in a legal battle. The most practical solution may be to wait out the 4 months, unless you can see a clear way around the contract or the employer gives you permission.

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It's difficult to say whether you'd be within the confines of that agreement, as the standard used to determine whether a particular non-compete agreement is enforceable is whether its terms are "reasonable" in scope and in duration. Not surprisingly, determinations regarding the enforceability of such agreements are very fact-specific. Before an attorney could give you an accurate assessment of whether your proposed activity would violate the terms of the agreement, he would need to see the entire agreement and get a more detailed description of your proposed activity. I hope this helps. Good luck.

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Attorney Larson is correct. An attorney should review your agreement before any specific advice can be given regarding your options. The reasonableness of the length of time, the geographic limitation, and the prohibitd activity all must be evaluated.

Depending on the circumstances, if there are only 4 months left, it may be more cost effective to just wait. Fighting non-compete agreements can be costly.

Each employment situation has unique facts and circumstances. This means that information and advice cannot be taken literally and should be used as only informational. The information provided here is not legal advice and should not be interpreted as such. This offer of free, general answers is not intended to create an attorney-client relationship. If you need specific advice regarding your legal question, you should consult an attorney confidentially.

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