ALERT: Illinois Appellate Court Strikes a Blow to Enforceability of Restrictive Covenants

On June 24, 2013, the Illinois Appellate Court made its much anticipated ruling in Fifield v. Premier Dealer Services (2013 IL App (1st) 120327), pertaining to the adequacy of continued employment as consideration for a restrictive covenant. In layman’s terms, the case addresses whether the promise of employment or the promise of continued employment is sufficient consideration for a restrictive covenant? Answering that question, the Illinois Appellate Court, in a first of its kind decision, concluded that unless the employee is continuously employed for two full years after signing, the answer is no and invalidated the covenant in question.

Do you have non-competition or non-solicitation agreements with your new and existing employees? Have all of the affected employees surpassed the two full years of employment bright line test? Are you concerned that your employees, especially your sales force, will abscond with your confidential information and use it for the benefit of a competitor?

We can help you assess the enforceability of your current restrictive covenant program or craft a viable restrictive covenant program in light of the new, seemingly hostile covenant environment this ruling has created. Please do not hesitate to contact any of our attorneys at Boodell & Domanskis, LLC to assist you in determining the ramifications of this case on your current operations.