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Does a non compete clause cover an idea?

New York, NY |

Hi, I'm considering leaving the software house that I work at to start contracting. During my time at the company, I designed and built a fairly unique software system. I didn't bother to patent it on behalf of the company so there are no copyright issues. My questions are: 1) After I leave the company, can I sell the high level design pattern commercially (or publish it in a white paper), if I change the names and the colors of the boxes? 2) Can I legally refuse to sign the non-compete clause on termination of my employment? I know that it's near impossible to patent an idea, so I guess my overall question is, where is the line between publishing the idea (in a commercially available white paper) and copying the engineering design? -Thanks

Attorney Answers 4


  1. Best answer

    Consult with a patent/trademark attorney in terms of how you can change your product so you can publish it without being liable for misappropriation. Non-compete clauses should be signed voluntarily and no one can force you to sign them.


  2. It's very likely that the creation you refer to was a "work made for hire" and, therefore, the property of your company, regardless of patent. Any sale or publishing of this information could be considered misappropriation of confidential information or trade secrets and subject you to claims for damages, despite the fact that you have not signed a noncompete. You can of course refuse to sign any agreement you like, particularly on termination of employment, but for the above reasons, I don't think it matters vis-a-vis this software. That said, you should have an in person consult with an attorney with expertise in intellectual property issues before you proceed, certainly worth a more in depth review.


  3. I agree that you may be liable. As far as signing anything, no one can force anyone to sign anything. You should always have an attorney review any legal document before signing it.


  4. If you plan to start a competing business, I strongly recommend getting legal advice about your responsibilities as a former employee. It has nothing to do with whether you had a valid noncompete agreement or not. You likely have additional fiduciary responsibilities as an employee that may prohibit you from using material, nonpublic information at your new company. Otherwise, you risk liability when your former employer discovers what happened. The benefit of successfully launching your company far outweighs the minimal cost of getting good legal advice before doing so. Be sure to speak with a New York lawyer about your rights, as employment law differs in each state.

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