Jonathan Pollard and his team at Pollard PLLC have become involved in yet another staffing non-compete dispute, this time in Pennsylvania.
In August 2013, a Pennsylvania-based software development company called Goli Technologies registered with the state of Pennsylvania as a potential vendor or supplier for the state. This registration was completed online, through a third-party called CAI. At the time, CAI was the Managed Service Provider for the Pennsylvania IT Staff Augmentation Services Contract. In that capacity, CAI was the single point of contact between the Commonwealth of Pennsylvania and suppliers for all of the state’s IT staffing needs.
In registering with the State via CAI, Goli Technologies was signing up – basically – to compete to fill open positions with the State. It could either fill those positions with its own in-house talent or it could recruit candidates to fill those positions.
Fast-forward to 2014. Somehow, Goli and his company Goli Technologies wound up signing on to perform certain services for the State through another company called Vinculum. Vinculum was also registered as a potential vendor through CAI. In working through Vinculum, Goli and Goli Technologies signed a non-compete and non-solicitation agreement.
Fast-forward to 2015. Goli and Goli Technologies are still being subcontracted to the State through Vinculum. But recall that Goli Technologies was a registered vendor through CAI. So Goli Technologies stats competing to fill open IT positions for the State through CAI. Vinculum gets wind of this and Vinculum sues.
Here’s the issue: Non-compete agreements are restraints of trade. If a non-compete agreement is not reasonably necessary to protect a legitimate business interest, it is unenforceable. In this situation, what is the interest? CAI is a public entity that allows anybody to register as a prospective supplier through its website. All of the job postings for the State are publicly available. The positions are filled on a competitive basis.
In participating in that competitive process, Goli Technologies did not utilize any information that could be considered Vinculum’s confidential or proprietary information. Defendant’s relationship with Vinculum in no way gave Defendant an unfair advantage in that process. Simply put, based on basic antitrust principals and the weight of non-compete case law, there is no legitimate business interest here. The case is ongoing.
Pollard PLLC is a litigation boutique focused on competition law. The firm’s principal Jonathan Pollard began his career at Boies, Schiller & Flexner and has extensive experience litigating non-compete, trade secret and antitrust cases. His office can be reached at 954-332-2380.
