Xplore Techs. Corp. v. Killion, 2010 Conn. Super. LEXIS 2401

Xplore Technologies Corporation was a company engaged in the engineering, developing, and marketing of rugged computer tablets.  Mr. Timothy Killion worked as a Senior Sales Representative with the company from December 8, 2003, to June 2010.  As part of his employment contract with Xplore, Mr. Killion signed a non-compete and non-disclosure agreement that stated, “By accepting this offer, you agree not to exercise or participate in any activity directly or indirectly competing with that of Xplore Technologies, Corp.” for a period of one year.

In June 2010, Mr. Killion announced that he would be leaving Xplore to work for another company, later identified as DRS Technologies, Inc., a direct competitor.  In the years leading up to Mr. Killion’s resignation he was intimately involved in the development of a new product and a deal with AT&T valued at $20-23 million.  Xplore commenced a suit seeking an injunction to prevent DRS’s further employment of Mr. Killion and prevent the disclosure/utilization of any classified information regarding Xplore’s business operations.  Mr. Killion claimed that the non-compete agreement was unenforceable because it was too broad in scope.

The Court’s Decision

The Superior Court held in favor of Xplore Technologies, finding the non-compete to be valid and issued an injunction prohibiting DRS from employing Mr. Killion until a year after his resignation from Xplore.  The court found that the strongest factor that made the agreement enforceable was the employer’s interest to protect its commercial operations.  Non-compete agreements protect employers in the specific area in which they do business by restricting the disclosure of trade secrets, technical marketing, and financial information.  The court held that the non-compete agreement was a reasonable and binding way for Xplore to protect itself given the uniqueness of the industry, its products, and business activities.

The court struck down Mr. Killion’s assertion that the agreement was too broad with regard to time and space.  It held that the one-year period was appropriate and reasonable provided the length of Mr. Killion’s employment with Xplore and the nature of the company.  The lack of geographical limitations does not invalidate the agreement in this case.  The nature of Xplore’s business is heavily internet-based and its employees’ work is not confined to a specific office within a specific geographical area.  Instead, the geographical limitations become Xplore’s three direct competitors that conduct business in the same manner and that are involved in the development of similar products.

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.