In Dr. C. Sims Dentistry Professional Corporation v. Cooke, 2024 ONCA 388, the Ontario Court of Appeal confirmed that restrictive covenants negotiated as part of the sale of a business must be treated differently by courts than those contained in employment contracts. The dispute arose from an agreement of purchase and sale between two dentists for a dentistry practice in Hamilton, Ontario (the “APS”). The APS contained a non-solicitation/non-competition provision, which prohibited the vendor from practicing dentistry within 15 km of the practice for a period of five years post-closing (the “Noncompete Provision”). About three years after the purchase and sale, the vendor began working at a separate practice in a location that violated the Noncompete Provision, and the purchaser commenced an action to enforce it. The purchaser was successful at trial, and the vendor made this appeal. In his appeal, the vendor submitted that the trial judge incorrectly placed … Read More
Domain Name Disputes, Counterfeit Websites, Fake Bad Reviews and Remedies
I discuss here a number of internet-based “dirty tricks” that competitors or others may deploy and which may have serious adverse consequences for you or your business. I also briefly mention the types of remedies which may be available to those victimized in this way. Confusingly Similar Domain Names In today’s modern web-based commercial world, it is more important than ever to ensure that potential customers and returning customers are properly connected with your website domain name, and to use domain names that are well-branded and associated with your business. It is not uncommon for competitors, cyber-squatters, or other persons to obtain control of domain names that are confusingly similar to your trademarks, business names, or your domain name. Then there is a real risk that users seeking your website are instead directed elsewhere by that confusingly similar domain name. Recovering a Domain Name In order to recover (transfer to … Read More
Confidentiality, Non-Competition and Non-Solicitation Clauses In Contracts
Confidentiality, non-competition, and non-solicitation clauses often show up in a variety of business contracts including employment and executive contracts, shareholder, and director agreements, as well as, independent contractor agreements, joint venture agreements and mergers, to name a few. A question that must be considered by contracting parties to such agreements is: What is the enforceability of these types of restrictive covenants? This question particularly becomes important when parties may part ways and a breach of the clauses is suspected or confirmed. These clauses are premised on the assumption that the relationship between the parties will result in the sharing of proprietary and sensitive business knowledge, contacts and relationships related to the operations of a business, which the company seeks to protect, particularly once the relationship between the parties ends. Non-competition clauses usually restrict one’s ability to engage in a competing business. Non-solicitation clauses prohibit one from soliciting stakeholders and contacts … Read More
Court Grants Interim, Interim Injunction Without Specific Evidence of Harm
In Knowmadics v. Cinnamon, 2018 ONSC 4451 (CanLII) the plaintiff company sought an urgent interim, interim injunction regarding an app sold by the defendants pending the hearing of a motion for an interlocutory injunction. The plaintiff sold specialized computer software. The individual defendant was employed by the plaintiff and signed an employment agreement, including a confidentiality and non-competition clause. The defendant also had a business, the corporate co-defendant, which did subcontracting work for the plaintiff after the defendant resigned from employment with the plaintiff. The corporate defendant signed a non-disclosure agreement with the plaintiff. The plaintiff alleged that the defendants were selling certain software that directly competed with the plaintiff’s software and infringed the plaintiff’s copyrights. The plaintiffs commenced an action against the defendants. After commencing the action, the plaintiff alleged that they learned that the defendants were also selling a certain app over which the plaintiffs asserted ownership. The … Read More
Court of Appeal Upholds Non-Solicitation Agreement
In MD Physician Services Inc. v. Wisniewski, 2018 ONCA 440 (CanLII), the individual defendants signed a non-solicitation agreement with the plaintiff company. The agreement provided that the individual defendants “shall not solicit during the Employee’s employment with the Employer and for the period ending two (2) years after the termination of his/her employment, regardless of how that termination should occur, within the geographic area within which s/he provided services to the Employer.” “Solicit” was defined as: “to solicit, or attempt to solicit, the business of any client, or prospective client, of the Employer who was serviced or solicited by the Employee during his/her employment with the Employee.” The individual defendants left the plaintiff to work for a competitor, the defendant company. On their first day of work for the defendant company, the individual defendants began contacting the plaintiff’s clients. The trial judge found that the individual defendants had breached the … Read More
Toronto Lawyers for Breach of Non-Compete or Non-Solicit Clauses
Our lawyers can advise and represent employers or purchasers of a business regarding the enforcement of non-compete, non-solicit clauses or confidentiality agreements. An employer or purchaser of a business who wishes to enforce a restrictive covenant can pursue an interim injunction from the Court, which prohibits the employee from breaching the covenant. Various types of injunctions may be sought, including: Injunctions enforcing post-termination restrictive covenants; Injunctions preventing the use of the employer’s confidential information. An employer or purchaser of a business can also seek damages following an employee’s breach of a covenant if there is particular loss tied to the breach. An employer or purchaser of a business can also seek damages following an employee’s breach of a covenant if there is particular loss tied to the breach. Why Gilbertson Davis LLP? Our team of lawyers are leading practitioners and provide sound advice and effective representation in time sensitive matters. When … Read More