Is a worldwide ban on soliciting former clients valid in Virginia?
Many non-solicitation contracts will state, “Employee will not, directly or indirectly, solicit competitive services from the customers of Employer for a period of two (2) years.”
Read literally: the employee cannot solicit former clients anywhere throughout the world.
Is a worldwide ban on solicitation enforceable?
A worldwide ban is enforceable in certain, limited situations.
Non-solicitation provisions must be “narrowly drawn to protect the employer’s legitimate business interest,” “not unduly burdensome on the employee’s ability to earn a living,” and, “not against public policy.” Omniplex World Servs. Corp. v. US Investigations Servs., Inc., 270 Va. 246, 249 (2005). A court will consider its “function, geographic scope, and duration.” Home Paramount Pest Control Cos. v. Shaffer, 282 Va. 412 (2011).
The three factors – function, geography, and duration – are considered together, not independently. Even a non-solicit lacks a geographic scope, a court may enforce a non-solicit if the function and duration are otherwise reasonably limited.
Consider two recent cases.
In Simmons v. Miller, a cigar distributor was banned from competing anywhere in the world for a period of three years. 261 Va. 561 (2001). The Supreme Court of Virginia struck down the three-year non-compete due to, in part, the lack of a geographic scope. Id.
By comparison, in Foti v. Cook, an accountant was banned from soliciting former clients anywhere in the world for a period of two years. 220 Va. 800 (1980). The Court upheld the restriction, even though it lacked a geographic scope, because the duration was shorter. Id.
Therefore, if the duration and function is reasonably limited, a worldwide ban on soliciting former clients will be upheld under Virginia law in limited circumstances.
The bottom line: A court will enforce a worldwide ban on soliciting clients in limited circumstances. But every contract is different. There are many ways to challenge a non-compete. An experienced non-compete lawyer can review the contract and develop a plan of action – before you sign, take a new job, or start a competing company.
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