Missouri Federal Court Reminds Employers That Noncompete Agreements Are Not Automatically Assignable
Lexology (03/20/15) Brian J. Christensen
In Symphony Diagnostic Services No. 1 Inc. d/b/a MobileXUSA v. Greenbaum, the U.S. District Court for the Western District of Missouri ruled that two employment agreements containing noncompetition covenants were unenforceable because the employees had not contemporaneously assented to their assignment when the employer's assets were sold to another company. The case involved employees who were offered employment with the new company on significantly less favorable terms, and they were terminated when they refused the job offers.
The court indicated that the outcome of the case would have been different had the employment agreements expressly permitted assignment by the employer. In response to the ruling, experts say Missouri employers should include clauses permitting assignment in their employment agreements, because they would be unenforceable in the event of a sale, acquisition, or other change in control without such language. Full Story Available