Saturday, April 21, 2018
A recent case out of Tennessee, Sugar Creek Carriages v. Hat Creek Carriages, No. M2017-00963-COA-R3-CV, lets us peek behind the scenes at the competition between horse-drawn carriage operators in Nashville, Tennessee. (You can listen to the oral argument here.) The defendant hired one of plaintiff's carriage operators, and the plaintiff sued based on the non-competition agreement that the employee had entered into.
However, the court refused to enforce the non-competition agreement. The plaintiff's argument boiled down to training that it had provided to the employee, but the court warned the plaintiff that it couldn't protect itself against the employee's using general skills and knowledge learned on the job. There were no allegations of the employee having any confidential information and no allegations that any customers associated the employee with the plaintiff's business. And, in fact, the training that the plaintiff gave to the employee it actually made available to the public at large, encouraging them to use the training to go forth and start their own horse-drawn carriage businesses. So, having offered the training to others with explicit encouragement of competition, the court refused to allow the plaintiff to impose a non-competition restriction on the employee based on the same exact training.