In its latest take on non-competes, the Minnesota Court of Appeals recently affirmed a lower court injunction prohibiting a former Medtronic employee from working for a direct competitor, despite an apparently tenuous claim for potential competitive harm. The defendant employee in the unpublished case Medtronic v. Sherland, A18-0579 (Minn. App. Dec. 24, 2018) left a job as “Senior Sales Training Manager” with plaintiff Medtronic for a position with a direct competitor, Bolton Medical Inc., as a trainer in the company’s sales department. Although the Defendant had signed, alongside a broad non-compete, a confidentiality agreement protecting from disclosure Medtronic’s trade secrets and confidential information, and although the defendant employee had been exposed to sensitive competitive information in his position with Medtronic (including strategies for countering the threat from Bolton), the plaintiff in the case made no legal claim under the confidentiality agreement. In other words, it had no reasonable basis in fact to believe that any confidential information had been disclosed to and used by a competitor. In affirming the lower court’s decision, the court necessarily found that plaintiff was likely to prevail on the merits. Unfortunately, the case is short on details as to just how a product trainer could ever harm a former employer. One struggles to imagine how teaching physician-customers how to operate a company’s aortic stent grafts in any way constitutes unfair competition. Under longstanding Minnesota law, noncompetes are narrowly construed against former employers and are only enforceable to the extent necessary to protect a legitimate business interest. Traditionally, they have been enforced only in situations in which the departing employee utilizes confidential information (whether or not rising to the level of trade secret) to the former employer’s competitive disadvantage or solicits the company’s customers and business. Here, there was no evidence or even argument of either, at least based on the relatively skinny factual recitation in the reported case. The case underscores what any careful observer of Minnesota’s law of non-competes would conclude: Minnesota courts love non-competes, despite the state’s otherwise progressive and employee friendly reputation. All of which underscores the importance of reviewing a non-compete with an experienced employment attorney before signing one or before taking actions potentially in conflict with one that you signed.
- The Shape of Mud: Assignability of Non-Competes Under Minnesota Law
- For Whom the Toll Tolls – Extending Non-Competes in Equity or by Contract in Minnesota
- Working for the Clampdown – Employee Class Actions in Peril?
- The Five-State Area and Non-Compete Law
- Minnesota Courts Heart Non-Competes: Watch What You Sign