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can a wide non-solicitation post-termination restriction be valid?

17 October 2013

A restrictive covenant preventing an ex-employee from soliciting customers from its former employer can be valid, even if the clause is not restricted to customers that the ex-employee has had recent dealings with.

In Coppage v Safety Net Services, Mr Coppage appealed against a decision that he had breached a non-solicitation clause. He argued that the clause was unreasonable, and therefore invalid, as it was not restricted to those customers he had dealt with in the last 12 months of his employment.

The Court of Appeal dismissed the appeal, stating there was nothing to suggest the trial judge had erred in deciding that the clause was reasonable overall. The fact that the covenant was limited to 6 months was a key factor.

The court reiterated that these cases are highly dependent on their specific facts. It is therefore important to remember that restrictive covenants will be void, unless the employer can show it has a legitimate business interest to protect and that the restriction goes no further than is reasonably necessary.

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