Law.com Subscribers SAVE 30%
Call 855-808-4530 or email [email protected] to receive your discount on a new subscription.
Forfeiture-for-Competition Agreements
Lawyer mobility is at an all-time high. Every week, the New York Law Journal contains announcements of partners and entire practice groups leaving one firm to join another. More and more first-time partners joined their firms as lateral associate hires rather than right out of law school. This phenomenon, which parallels the higher rates of mobility among employees in other sectors of the economy, is relatively recent. Through the 1960s, it was rare for a partner to leave his law firm for another firm in the same geographic area. See Linda Ewald, Agreements Restricting the Practice of Law: A New Look at an Old Paradox, 26 J. of the Legal Prof. 1, 1 at n. 6 (hereinafter 'EWALD').
Individual lawyers command greater market power than at any time before. As law practice has become more specialized and corporate legal departments have taken over some of the basic legal work that used to support law firms, firms are competing for valuable business. Milton Regan, Law Firms, Competition Penalties & The Values of Professionalism, 13 Geo. J. Legal Ethics, 1, 7-9 (Fall 1999). Lawyers (or groups of lawyers) who have a portable book of business can command a larger share of the revenue from their business by going to the highest bidder. Firms also aggressively recruit highly profitable lawyers with promises of enhanced support for the lawyers' practice, including technology, staffing, and marketing. This is on top of the investments that firms make in developing and maintaining strong, long-term client relationships.
Law firms are constrained by professional ethics in how they address the issues of lawyer mobility. Rule 5.6 of the ABA Model Code of Professional Responsibility expressly prohibits lawyers from entering into agreements that restrict their right to practice, including covenants not to compete. The overwhelming majority of jurisdictions interpret the rule to preclude less direct restrictions on competition, including financial penalties known as 'forfeiture-for-competition' agreements.
This premium content is locked for Entertainment Law & Finance subscribers only
ENJOY UNLIMITED ACCESS TO THE SINGLE SOURCE OF OBJECTIVE LEGAL ANALYSIS, PRACTICAL INSIGHTS, AND NEWS IN ENTERTAINMENT LAW.
- Stay current on the latest information, rulings, regulations, and trends
- Includes practical, must-have information on copyrights, royalties, AI, and more
- Tap into expert guidance from top entertainment lawyers and experts
Already a have an account? Sign In Now Log In Now
For enterprise-wide or corporate acess, please contact Customer Service at [email protected] or 877-256-2473
Major Differences In UK, U.S. Copyright Laws
This article highlights how copyright law in the United Kingdom differs from U.S. copyright law, and points out differences that may be crucial to entertainment and media businesses familiar with U.S law that are interested in operating in the United Kingdom or under UK law. The article also briefly addresses contrasts in UK and U.S. trademark law.
The Article 8 Opt In
The Article 8 opt-in election adds an additional layer of complexity to the already labyrinthine rules governing perfection of security interests under the UCC. A lender that is unaware of the nuances created by the opt in (may find its security interest vulnerable to being primed by another party that has taken steps to perfect in a superior manner under the circumstances.
Strategy vs. Tactics: Two Sides of a Difficult Coin
With each successive large-scale cyber attack, it is slowly becoming clear that ransomware attacks are targeting the critical infrastructure of the most powerful country on the planet. Understanding the strategy, and tactics of our opponents, as well as the strategy and the tactics we implement as a response are vital to victory.
Legal Possession: What Does It Mean?
Possession of real property is a matter of physical fact. Having the right or legal entitlement to possession is not "possession," possession is "the fact of having or holding property in one's power." That power means having physical dominion and control over the property.
The Anti-Assignment Override Provisions
UCC Sections 9406(d) and 9408(a) are one of the most powerful, yet least understood, sections of the Uniform Commercial Code. On their face, they appear to override anti-assignment provisions in agreements that would limit the grant of a security interest. But do these sections really work?