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Florida Choice of Law Provision Re: Covenants Not to Compete Unenforceable in New York/the Nonsolicitation Covenant at Issue Was Overbroad and Unenforceable

In a full-fledged opinion by Justice Whalen, the Fourth Department determined that Florida law re: covenants not to compete was “truly obnoxious” to New York law and the nonsolicitation covenant at issue was overbroad and unenforceable:

…[W]e conclude that Florida law prohibiting courts from considering the hardship imposed on the person against whom enforcement is sought is “ ‘truly obnoxious’ ” to New York public policy …, inasmuch as under New York law, a restrictive covenant that imposes an undue hardship on the employee is invalid and unenforceable for that reason ‘’’ .  Furthermore, while New York judicially disfavors such restrictive covenants, and New York courts will carefully scrutinize such agreements and enforce them “only to the extent that they are reasonably necessary to protect the legitimate interests of the employer and not unduly harsh or burdensome to the one restrained”…, Florida law requires courts to construe such restrictive covenants in favor of the party seeking to protect its legitimate business interests (see Florida Statutes § 542.335 [1] [h]). * * *

A non-solicitation covenant is overbroad and therefore unenforceable “if it seeks to bar the employee from soliciting or providing services to clients with whom the employee never acquired a relationship through his or her employment” … .  Here, the non-solicitation covenant purported to restrict [defendant] from, inter alia, soliciting, diverting, servicing, or accepting, either directly or indirectly, “any insurance or bond business of any kind or character from any person, firm, corporation, or other entity that is a customer or account of the New York offices of the Company during the term of [the] Agreement” for two years following the termination of Johnson’s employment, without regard to whether defendant acquired a relationship with those clients. We conclude that the language of the non-solicitation covenant renders it overbroad and unenforceable … . Brown and Brown Inc… v Johnson…, 1109, 4th Dept 2-7-14

 

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