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eLABORate: Social Media Complications in the Enforcement of Non-Solicitation Agreements

October 24, 2017

Determining whether a former employee has breached a non-solicitation agreement has become a more complicated issue in the social media age. Courts are wrestling with the question of when a former employee’s social media interaction crosses the line into contractually prohibited solicitation.

At the start of employment, many businesses require employees to sign non-solicitation agreements, which restrict the employee from contacting the company’s customers or employees for a set period after the employee leaves the company. The goal of such agreements is to prevent the poaching of customers and/or co-workers by the departing employee, who often is headed to work for a business competitor.

Companies commonly use social media, such as Facebook or LinkedIn to market, advertise and communicate with customers. A company’s employees also frequently will add these same customers to their own personal social media accounts as Facebook “friends” or LinkedIn “connections.” A common scenario involves a company’s customers or employees continuing to receive status alerts from the company’s former employee, either in the form of automatic updates, usually regarding their new employment, or more direct communications. While these type of cases are often very fact-specific, courts have held that a key consideration in determining whether a social media post is an improper solicitation is the content and substance of the post, and whether the social media activity is passive or active.

An example of such passive social media activity is found in Bankers Life & Casualty Co. v. American Senior Benefits, LLC, 2017 WL 3393844 (Ill. App. Ct. Aug. 7, 2017). In that case, the court held that a former employee sending invitations to former co-workers to connect via LinkedIn did not constitute solicitation in violation of his non-competition agreement. In ruling against the former employer, the court noted that the invitations to connect were sent through generic e-mails that invited recipients to form professional connections, and that the generic e-mails did not contain any discussion of the former or current employer, did not suggest that recipients view open job positions on the former employee's profile page, and did not solicit recipients to leave their place of employment. The court in Bankers Life & Casualty cited rulings from other jurisdictions as to the difference between permitted “passive, untargeted communications” and prohibited active and direct solicitations.

Another case in which a court found no violation of a non-solicitation agreement, and ruled against the employer is Invidia, LLC v. DiFonzo, 2012 WL 5576406 (Mass. Super. Ct. 2012). In that case, the former employee was a hair stylist, who was under a two year non-solicitation agreement. The former employee had become Facebook friends with at least eight clients of her former employer, and upon leaving her employment with Invidia, a public announcement was posted on her Facebook page announcing her new employment at another hair salon. In ruling that this did not violate her non-solicitation agreement, the court noted:

In the comment section below that post, [Invidia customer] Ms. Kaiser posted a comment which said, “See you tomorrow Maren [DiFonza]. Ms. Kaiser then cancelled her appointment at Invidia for the next day. But it does not constitute “solicitation” of Invidia’s customers to post a notice on Ms. DiFonza’a Facebook page that Ms. DiFonza is joining David Paul Salons. It would be a very different matter if Ms. DiFonza had contacted her that she was moving to David Paul Salons, but there is no evidence of any such contact.

In the Invidia case, it bears mention that the court declined to enforce the non-solicitation agreement based on the purportedly passive social media activity, even though there was evidence that 90 of Invidia’s clients had subsequently canceled or failed to reschedule appointments after the Facebook posting.

In contrast, courts have enforced non-solicitation agreements when confronted with active or aggressive social media activity on the part of the former employee. In Coface Collections North America c. v. Newton, 430 Fed. Appx. 162 (3rd Cir. 2011), the appeals court affirmed an order to enforce a non-solicitation/non-competition agreement where the former employee posted on LinkedIn the date on which his restrictive covenant would expire, encouraged “experienced professionals” to contact him about employment with his new company, and sent Facebook friend requests to a number of his former co-workers, specifically inviting them to view his posted job solicitations.

Employers looking to enforce non-solicitation agreements or other restrictive covenants in the social media age should consider the following:

  • Many employers are using the same outdated non-solicitation/non-competition agreements they have used for years, which do not reference social media in any manner. Employers should revise and update such agreements to specifically address what types of social media activity will constitute a breach. Courts are more likely to enforce such agreements if the employee was expressly placed on notice.
  • A court will require evidence before it issues a temporary restraining order or other injunctive relief against a breaching former employee. However, evidence of a breach of a non-solicitation agreement through social media can be very transitory or can be deleted by a former employee trying to destroy evidence. Any posting by a former employee suspected of violating their agreement should be immediately preserved, either through printed copies of screen shots, or saved digitally.

Another issue companies should be aware of is their own utilization of social media, and more specifically, the employees who have access to these accounts and post content on behalf of the company. In recent years, issues have arisen where a disgruntled departing employee is the only person who knows the passwords and usernames, and essentially locks the company out of its own social media accounts. All such employees should be required to sign agreements to provide access to such account information upon the termination of their employment, and such an agreement could be included in the terms of a non-competition/non-solicitation agreement.

Mark Fijman is licensed to practice in Louisiana and Mississippi, and specializes in the enforcement of non-competition/non-solicitation agreements and trade secret litigation.