Legal Question in Business Law in Minnesota

Non Compete Clause

What is the actual law regarding a non compete clause when a business is sold and the old owner agrees not to open another similar business? Are there any cases with a ruling regarding this type of situation?


Asked on 12/07/06, 8:56 am

3 Answers from Attorneys

David Anderson Anderson Business Law LLC

Re: Non Compete Clause

Yes, if written right they may be enforceable. I have experience with these.

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Answered on 12/07/06, 10:38 am
David Kelly-952-544-6356 Kelly Law Office

Re: Non Compete Clause

Cases? Whole shelves of books have been written on this subject.

There are rules about when they are and when they are not legal. The basic rule is they have to be "reasonable." But what that means is pretty tricky.

You need a consultation with a competent lawyer who has had a chance to review the contract in quesiton. Figure on paying a consult fee of about $250.

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Answered on 12/07/06, 11:41 am
Maury Beaulier612.240.8005 Minnesota Lawyers

Re: Non Compete Clause

I am not sure that I understand the question completely.

There is much case law on the enforeceability of Covenants not to Compete. They must be properly structured and be sufficiently narrowly tailored with respect to gepography and duration to be enforceable. They must also be supported by consideration necessary to form a contract.

If you would like a review of your contract or if you are planning on structuring a business sale or acquisition, please contact our office.

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Answered on 12/07/06, 11:43 am


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