Runzheimer Int’l, Ltd. v. Friedlen

David Friedlen had worked for Runzheimer International, Ltd. for more than fifteen years when Runzheimer began requiring its employees to sign restrictive covenants or be fired. Friedlen signed the covenant and continued to work for Runzheimer for more than two years until he was terminated. Friedlen subsequently began working at Corporate Reimbursement Services (CRS), one of Runzheimer’s competitors. Runzheimer sued Friedlen and CRS, alleging that Friedlen’s employment at CRS constituted a breach of the restrictive covenants. Defendants moved for summary judgment, claiming that the covenant was unenforceable because it lacked consideration. The circuit court granted summary judgment for Defendants. The Supreme Court reversed, holding (1) an employer’s forbearance in exercising its right to terminate an at-will employee constitutes lawful consideration for signing a restrictive covenant; and (2) because the circuit court made no determination as to the reasonableness of the covenant’s terms, the cause must be remanded for further proceedings. View "Runzheimer Int’l, Ltd. v. Friedlen" on Justia Law