Webster Financial Corporation v. Levine, 2009 Conn. Super. LEXIS 841
Case Background

Mr. Gerald Levine sold his shares of LLIA, Inc., a financial and insurance firm, to Webster Financial Corporation in February 2000 along with other shareholders of the company.  He executed a Stock Purchase Agreement, Employment Agreement, and a Non-Solicitation Agreement with Webster Financial in connection with the transaction.  The agreements contained a series of restrictive covenants that prohibited Mr. Levine for two years following termination from soliciting or accepting any brokerage business from entities that were LLIA or Webster clients while he was an employee with the company.

He worked as a Webster Financial employee until June 2007 when he voluntarily terminated his employment and began to work at Beecher Carlson Insurance Services, LLC, a firm providing similar services.  Webster Financial sued Mr. Levine and requested that the court enforce the provisions of the restrictive covenants.  Mr. Levine submitted a motion for summary judgment and this request is the focal point of the court’s analysis and decision.

Trial Process

The court denied Mr. Levine’s motion for summary judgment, holding that the “issues raised by the defendant [Levine] concerning the breadth and enforceability of the NSA should await trial and should not be resolved through summary judgment.” The judge felt that summary judgment was inappropriate for this case because the parties’ claims raised “genuine issues of disputed fact not amenable to summary disposition.”  Mr. Levine presented several arguments as to why the agreements were unenforceable and that Webster Financial’s claim lacked merit but the court rejected them as basis for granting summary judgment.

Mr. Levine argued that the restrictive covenants lacked proper consideration and that the provisions of the covenants were unreasonable in scope.  He asserted that Webster Financial procured the covenants solely by the grant of stock and this represented inadequate consideration to make the agreements binding upon the parties.

Court Ruling

The court however identified several sources of consideration for the covenants such that Mr. Levine gave the covenants in exchange for the sale of LLIA, employment with Webster Financial, and the issuance of shares of stock.  The court also refuted Mr. Levine’s contention that the provisions were unreasonable in scope because there was no expressed geographical limitation.  The court concluded that the absence of an expressed limited area did not render the restriction unreasonable because the language of the agreement itself sufficiently restricted its application of the employment prohibitions.

Mr. Levine failed to meet the burden of proof necessary to show that the case did not have disputed material facts and that he was entitled to summary judgment as a matter of law, causing the court to deny his motion for summary judgment.

The lawyers at Maya Murphy, P.C., are experienced and knowledgeable employment and corporate law practitioners and assist clients in New York, Bridgeport, Darien, Fairfield, Greenwich, New Canaan, Norwalk, Stamford, Westport, and elsewhere in Fairfield County.  If you have any questions relating to your non-compete agreement or would like to discuss any element of your employment agreement, please contact Joseph C. Maya, Esq. by phone at (203) 221-3100 or via e-mail at JMaya@Mayalaw.com.