'Should I Stay or Should I Go?' - Covenants Not to Compete in a Down Economy: A Proposal for Better Advocacy and Better Judicial Opinions

Abstract

This article critiques the use of the contract consideration doctrine to differentiate between employee covenants not to compete that are reasonable and should be enforced and that that are not. The focus is on the particular difficulties created when the nominal consideration for a covenant is the offer of or continuation of an employment at-will. The article is designed for advocates and for judges. It provides an overview of relevant theoretical literature and a detailed critique of several cases. It should interest those concerned with the protection of intellectual property by contract and those interested in legal rhetoric.

Keywords: contracts, consideration, employment at will, covenants not to compete, rhetoric, law and economics

JEL Classification: K12, K41