Law School Discussion

Nine Years of Discussion
;

Author Topic: Non-compete clause in entry level associate contract? Is this odd?  (Read 1394 times)

MiamiLaw

  • Sr. Citizen
  • ****
  • Posts: 224
    • View Profile
This is just for an entry level associate position at a small firm.  The contract has a non compete clause that says I can't work in this area in any capacity in this practice area for 1 year after I am no longer working there.  The district specified is more than a quarter of the state,  and it's by far the most populated and built up part. 

It does say that the clause won't be valid if I am terminated or laid off however.

Is this a common thing for entry level attorney positions (on the consumer side) or is this strange?

MikePing

  • Sr. Citizen
  • ****
  • Posts: 247
    • View Profile
    • Law School Information
    • Email
Re: Non-compete clause in entry level associate contract? Is this odd?
« Reply #1 on: April 12, 2011, 12:24:49 PM »
It does seem a little odd. 

It is reasonable if the firm is going to extensively train you in a specific practice area.  From their perspective, they probably don't want to show you all the tricks only to create a competitor.  The restrictions seem reasonable, and the termination clause works in your favor. 

Morten Lund

  • Sr. Citizen
  • ****
  • Posts: 259
    • View Profile
Re: Non-compete clause in entry level associate contract? Is this odd?
« Reply #2 on: April 12, 2011, 01:29:07 PM »
That strikes me as more than just a little odd.  I have never heard of such a thing for law firm associates, and this seems to me an odd use of a non-compete in general.

 If you take this job, and then subsequently find yourself thinking of departing, I would encourage you to consult an attorney (not in that firm) regarding the enforceability of that agreement.

FalconJimmy

  • Sr. Citizen
  • ****
  • Posts: 684
    • View Profile
    • Email
Re: Non-compete clause in entry level associate contract? Is this odd?
« Reply #3 on: April 12, 2011, 03:13:15 PM »
The contract has a non compete clause that says I can't work in this area in any capacity in this practice area for 1 year after I am no longer working there.  The district specified is more than a quarter of the state,  and it's by far the most populated and built up part. 

Is this a very new firm, perhaps?  Maybe two partners and they're both very young?

Sounds sorta chicken shite of you ask me.  Attorneys change firms all the time.  That would never, ever happen if this sort of noncompete were common. 

john4040

  • Sr. Citizen
  • ****
  • Posts: 471
    • View Profile
Re: Non-compete clause in entry level associate contract? Is this odd?
« Reply #4 on: April 12, 2011, 04:49:53 PM »
This is just for an entry level associate position at a small firm.  The contract has a non compete clause that says I can't work in this area in any capacity in this practice area for 1 year after I am no longer working there.  The district specified is more than a quarter of the state,  and it's by far the most populated and built up part. 

It does say that the clause won't be valid if I am terminated or laid off however.

Is this a common thing for entry level attorney positions (on the consumer side) or is this strange?

Bullsh1t.  It's not just odd, it's most probably completely unenforceable and a violation of the ethics code (and when I left the firm, if they tried to enforce the clause, I'd tell them to shove the clause where the sun don't shine). 

Forty-nine states have adopted Model Rule 5.6 or some modified version of it or its predecessor, ABA Model Code of Professional Responsibility D.R. 2-108. Maine is the only state with a rule that allows restrictions on the practice of law as a condition for receiving post-employment compensation.

Model Rule 5.6 provides as follows:

A lawyer shall not participate in offering or making:

(a) a partnership, shareholders, operating, employment, or other similar type of agreement that restricts the right of a lawyer to practice after termination of the relationship, except an agreement concerning benefits upon retirement; or

(b) an agreement in which a restriction on the lawyer's right to practice is part of the settlement of a client controversy.


Termination of the relationship = laid off, quit, terminated... whatever.  The relationship terminates whenever you no longer work there for whatever reason.

Many of these rules stem from the belief (and the rule) that the client should have unfettered access to choose his attorney, assuming there are no conflicts which would otherwise prohibit representation.

FalconJimmy

  • Sr. Citizen
  • ****
  • Posts: 684
    • View Profile
    • Email
Re: Non-compete clause in entry level associate contract? Is this odd?
« Reply #5 on: April 12, 2011, 05:37:59 PM »
I'm a little out of my depth here, but doesn't this strike at the heart of portable and non-portable clients?

Again, correct me if I've got this wrong, but upon leaving a firm, isn't it customary that clients the firm ALREADY HAD traditionally stay with the firm?  Whereas clients that were acquired during an attorney's tenure (provided the attorney was the major or lead counsel for the client) are portable and the attorney can take them when/if the attorney leaves and goes to another practice or starts his/her own?

And my understanding of that was that it was more of a gentleman's agreement, anyway.

However, to prohibit a person from practicing in that area of law entirely? 

john4040

  • Sr. Citizen
  • ****
  • Posts: 471
    • View Profile
Re: Non-compete clause in entry level associate contract? Is this odd?
« Reply #6 on: April 12, 2011, 06:04:29 PM »
I'm a little out of my depth here, but doesn't this strike at the heart of portable and non-portable clients?

Again, correct me if I've got this wrong, but upon leaving a firm, isn't it customary that clients the firm ALREADY HAD traditionally stay with the firm?  Whereas clients that were acquired during an attorney's tenure (provided the attorney was the major or lead counsel for the client) are portable and the attorney can take them when/if the attorney leaves and goes to another practice or starts his/her own?

And my understanding of that was that it was more of a gentleman's agreement, anyway.

However, to prohibit a person from practicing in that area of law entirely?

Such an agreement strikes at the heart of a client's choice to choose his attorney.  The client always has the choice to stay with the firm, leave with a particular attorney that defected from that firm, or to hire an entirely different attorney - this rule is universally accepted amongst all states.  Customarily, however, the client will remain with "his" attorney (i.e., the one that gave him face-time and was regularly counseling him during the case or transaction) and leave the firm high-and-dry (unless the client is dissatisfied with "his attorney's" work or  has some sort of particular allegiance to the firm -- maybe the client desires the prestige of the name "Watchell", or the client would like the firm to handle matters in which "his" attorney does not specialize). 

In any event, the firm has absolutely no right to inhibit the client's choice of attorney, nor does the attorney have any right to limit the client's choice of firms. All clients are "portable" to the extent that they are willing and representation will cause no conflicts of interest.