Hi
Been issued with a rather threatening letter today from a former employer (I have a one man business that was under contract with them). They claim that I have breached contract by establishing a competing firm. I am pretty sure that I haven't done anything wrong but proving it will cost more money than I have. Anyone willing to offer some pointers?
Thanks
Do you have a non-comp clause in your contract? (As in, is there something in the contract with said ex-employers saying you cannot work for/et up a competitor within x period of time)
As CF says - such clauses are enforceable as long as they are reasonable and don't go too far. Many such clauses are found to go further than is necessary (for the employer to legitimately protect it's business) in which case the clause falls - in its entirity.
The alternative they may be looking at is in each contract of employment is an implied 'duty of fidelity' - i.e. if they believe you had taken steps to set up your business at their expense any using their information and in competition to them it is possible for them to persue you for their losses (if they can show some).
Have you tapped up some of their clients?
Their business was conceptual in that it hadn't been commercialised (new technology). I've only conducted research since my termination. Have a new method for doing the same thing but still at drawing board stage although a new patent application has been filed. I have a website which I guess they have picked up on but no losses for them as they have no employees and no product or service. They say I'm competing but I've made no sales or generated any income.
I think you need an IP lawyer as much as an employment one.
What's yours and what's theirs?
As Higgo said the thing that got me was this
Their business ... hadn't been commercialised (new technology)..... Have a new method for doing the same thing.
You could be in breach of IP/patents of their technology. Which is more complex than a contract issue over setting up as a competitor.