No specific laws identified for this ruling.
The court affirmed judgment in favor of defendant Herman on both noncompete and nonsolicitation breach claims, finding the nonsolicitation provision unenforceable and declining to blue pencil it. However, the court reversed the denial of attorney fees and remanded, holding that Herman is entitled to recover attorney fees as the prevailing party on the breach of contract claims.
Herman worked as a legal recruiter for 23 LTD, d/b/a Bradsby Group (Bradsby). When she was hired, Herman signed an employment agreement with a nonsolicitation provision and a noncompete provision. Bradsby terminated Herman's employment and she thereafter founded a company that did some legal recruiting and law firm succession planning. Bradsby sued Herman for breach of the noncompete and nonsolicitation provisions. A jury determined that Herman had not breached the noncompete provision, but returned a verdict in favor of Bradsby on the nonsolicitation claim and awarded nominal damages of one dollar. The district court set aside that verdict and entered judgment in favor of Herman because the nonsolicitation provision violates Colorado law and the court declined to narrow the provision to render it enforceable. The court denied Herman's request for attorney fees under the employment agreement's fee-shifting provision. On appeal, Bradsby argued that the district court erred in declining to blue pencil the nonsolicitation provision. Parties to an employment, noncompete, or nonsolicitation agreement cannot contractually obligate a court to blue pencil noncompete or nonsolicitation provisions to render unenforceable terms enforceable. But a trial court has broad discretion to blue pencil an otherwise offensive restrictive covenant. Here, the district court gave substantial reasons why it declined to exercise its discretion to blue pencil the agreement, including the general Colorado public policy against noncompete provisions, authority in other jurisdictions, and the significant overbreadth of the nonsolicitation provision. Thus, the district court did not err. Bradsby next argued that the jury's verdict that Herman did not form a competing company in violation of the noncompete provision is not supported by the evidence. The noncompete provision stated that, upon her termination, Herman would not become involved in a company that competed with Bradsby within a defined
The Dispute
Herman worked as a legal recruiter for 23 LTD (doing business as Bradsby Group). When hired, she signed an employment contract that included clauses preventing her from competing with the company and soliciting its clients after leaving. When Bradsby fired Herman, she started her own company offering legal recruiting and law firm planning services. Bradsby sued her, claiming she violated the noncompete and nonsolicitation agreements.
The Court's Decision
The court ruled in Herman's favor on both claims. A jury found that Herman did not violate the noncompete clause. The court also determined that the nonsolicitation provision was unenforceable and refused to modify it to make it valid. Additionally, the court ruled that Herman should receive payment for her attorney fees since she won the case, though Bradsby was only ordered to pay $1 in damages.
What This Means for Workers
This case shows that courts will carefully examine restrictive employment clauses and may refuse to enforce ones that go too far. Workers who successfully defend against breach of contract claims may be able to recover their legal costs. However, the outcome depends heavily on the specific contract language and circumstances, so each case is different.
This summary was generated to explain the ruling in plain English and is not legal advice.
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