I’ve actually been defending non-compete cases for longer than 12 years. It’s a little over 12 years if you only count the time since I started the law firm Pollard PLLC. If you also count my time at Boies, Schiller & Flexner — then it’s over 14 years. Because one of the cases I worked on extensively at BSF was Southern Wine & Spirits vs. Simpkins, a non-compete case out of the United States District Court for the Southern District of Florida (yes, we won that one, too).
But that’s different. Because it was really my boss’s case, not so much my own. And BSF is/was a big name brand firm. So they got much different treatment in the legal system than, say, me circa 2013 in a random Florida state court. So I’ll just focus on my experience with these cases in the 12 years since I started my own shop.
I’m not going to sugarcoat it. I’m going to give you the ugly and unvarnished truth. I have defended more than 150 non-compete cases and counting. So I know a little bit about the subject. You can take this however you want to take it.
Non-compete abuse is a regional problem that is worst in the South. I have written about this extensively. And about the historical connections between non-compete abuse, the civil rights movement, the civil war, and – yes, ultimately – slavery. The states that are the absolute worst offenders here are all Old Dixie. It’s the Confederacy. Florida and Texas are the outright worst. It’s not coincidental that former slave states are the most obsessed with (a) preventing people from selling their own labor (b) controlling other peoples’ labor (c) exploiting poor and working people and (d) thumbing their nose at the federal government (because non-compete abuse violates antitrust law).
Judicial activism by pro-non-compete judges is a serious problem. Non-compete agreements are supposed to be governed by antitrust law. Non-compete agreements are restraints of trade. They are not simple and ordinary contracts. But many judges approach non-compete cases like this: “You signed a contract. And I hold people to their contracts!”. This is a problem. Judges sometimes use non-compete cases to opine on how they long for the good old days when people were held to their contracts. When a judge does this instead of discussing antitrust law and unfair competition, that is either ignorance of the relevant law or judicial activism.
Judges should be saying something that goes in this direction: “This is a contract that restricts competition. So I have to evaluate it based on antitrust law and really make sure that it’s not just being used to prevent fair and ordinary competition. Non-compete agreements can only be enforced to prevent unfair competition.” But many judges in the South don’t approach non-compete cases that way. They approach them through the contract-enforcement lens. Their logic is basically thus: “Of course its unfair competition! The guy signed a contract saying he wouldn’t compete and he’s out there competing!”. That’s a problem.
Over the years, I have seen many judges either not acknowledge that non-compete agreements are governed by antitrust law, or, express shock and skepticism at the mention of antitrust law. Basically: Why is this crazy lawyer Pollard mentioning antitrust law? This is a contract case. I can get you a direct quote from a federal judge who said point blank that he did not know about my antitrust argument, but that he enforces non-compete agreements all the time.
That was a go out in the hallway and settle moment. See, that’s really how the sausage is make in the American legal system. That is less of a problem today than it was 10 or 15 years ago. Partially because so many trial courts have gotten reversed for enforcing bogus non-compete agreements. Appellate courts have repeatedly had to tell trial court judges that corporate plaintiffs in non-compete cases don’t just get a free pass. They have to do more than give lip service to the concept of a legitimate businesses interest. And, that trial court judges need to stop entering non-compete injunctions that the corporate plaintiffs’ lawyer wrote— and that read like puff pieces for said corporate plaintiff. Again, it’s still a problem until non-compete agreements die a way overdue death. But it’s better than it was 10 years ago.
Non-compete abuse has exposed dysfunction, bias, and cronyism in the judicial system. When I started defending non-compete cases more than a decade ago, it was even worse. Back then, it was incredibly common for a corporate lawyer to file a non-compete lawsuit, run into court screaming about an emergency, and get the court to enter an injunction without the defendant ever getting a chance to argue their side of the case. This was incredibly common in Florida state courts. Sometimes, Florida state courts did this without any notice to the defendant. Other times, they gave the defendant only the most minimal notice — often less than 24 hours. Think about that. It’s 2005. You’re making $12 an hour. You get sued over a bogus non-compete agreement. The company’s lawyer starts sending you threatening emails. They file a lawsuit. The company’s lawyer emails you and tells you that you need to show up tomorrow for a hearing — you don’t have any money, you don’t have a lawyer, and you’re afraid you’re going to lose your new job. The company’s lawyer goes into court. They know the judge very well — they mix and mingle in the same social circles. They lawyer donated money to the judge’s reelection campaign. The judge enters the injunction. That was the reality in Florida and in many other parts of the South. And plenty of lawyers made their living that way. And plenty of judges went along with it and rubber stamped injunctions enforcing those bogus non-compete agreements. How many lives did these people ruin? Do they care? Were they ever held accountable? No, not really.
Corporate lawyers are complicit in the widespread use and abuse of non-compete agreements because non-compete abuse makes them lots of money. About 20 years ago, non-compete agreements started cropping up everywhere. They spread like wildfire. This was pushed by corporate lawyers. It’s basically corporate lawyers making work for themselves and setting up future revenue streams. Think about it. Let’s go back 20 years. Say it’s 2004. A lawyer advises 10 or 15 different businesses of various shapes and sizes. He decides that he’s going to encourage all of his clients to adopt employee non-compete agreements. He tells the decision-makers at each company that they need employee non-compete agreements to protect their business. It’s an easy sell — especially when you’re selling it to an egomaniac President or CEO who thinks he’s a genius and is deathly afraid of competition. So the corporate lawyer makes revenue off drafting / preparing the non-compete agreements. But even better: The corporate lawyer has set up a future revenue stream based on non-compete enforcement. Isn’t that brilliant? An employee leaves Company X. They’re really no harm to Company X. But a crafty, billable-hour hungry corporate lawyer can easily convince the aforementioned egomaniac CEO of Company X that the company’s very existence is in jeopardy. That former employee Joe could steal everything he’s worked for and built. That the only option is filing a non-compete lawsuit. It’s like printing money. Don’t for one second doubt that corporate lawyers were a major driver of America’s non-compete crisis.
There have been aggressive efforts to silence me, quell my advocacy, and even take my law license — because of my fight against non-compete abuse and on behalf of poor and working people. Non-compete abuse has been big business in Florida for 20+ years. Some lawyers and law firms have made big money serving as their corporate clients’ outside non-compete enforcer. So, by virtue of my standing up to non-compete abuse (i.e. part of their revenue stream), I am enemy number 1.
Earlier in my career, the machinations against me used to be a bit scary. Rich, powerful people who are politically connected in their little corners of Florida hate me for blowing up their non-compete cartel (and revenue stream) and have come after me pretty hard.
Imagine having a newborn baby in the NICU, running a small firm where you do tons of pro bono work for poor people, working your ass off to make a fairly modest living, and fighting off all sorts of threats and reprisals from Florida’s good old boys’ network. It wasn’t easy.
But you know what? All of this made me harder. It made me tougher. It made me more resourceful.
I think about the type of law or litigation situations that I considered ugly or stressful even 5 or 6 years ago. Today? They wouldn’t even phase me.
Lessons learned. We won a lot of these cases. We won by ether beating an injunction, getting the injunction reversed on appeal, or brokering a favorable settlement that allowed our client to come out ahead. We won far more of these cases than we lost. But we still lost several of them. And some of them that we lost, I believe we would have won if the judge had applied the law fairly, impartially, and correctly.
I have zero faith in the American legal system. I want to have faith. I believe that all judges should be truly neutral and impartial and apply the law as it exists without bias or prejudice. But I do not believe that actually happens in America today. Judges are not magical and somehow beyond human shortcomings. Many humans have terrible biases and prejudices. And judges are human. I have seen judges ignore well-established case law, knowing that the likelihood of them ever getting reversed on appeal was slim to none (as if a poor person can even afford to appeal). I have seen judges scoff at the mention of antitrust law in the context of non-compete cases. I have seen judges preside over non-compete cases when they probably should have recused themselves to avoid the appearance of bias and cronyism. I have seen judges debate over whether or not a law-wage security guard could ever have an enforceable non-compete agreement after two weeks of employment with the company (the clear and plain answer is no). I have seen the absurd machinations and backroom dealing of America’s bankruptcy courts. I have seen lawyers who seemed like decent people show their true colors when $50,000 or $100,000 was dangled in their face to turn corrupt.
In 10 or 15 years, America will look back at the era of non-compete abuse with absolute revulsion and horror. And I was always on the right side of this issue. I was always fighting for poor, working, and middle class people. Even when it cost me a bunch of money and made me a bunch of powerful enemies.
I have learned that the only way out is through. Keep the faith. Just keep going. The arc of history is long, but it bends toward justice.
JP
