Delaware Court Weighs Free Market, Clawbacks in Noncompete Pacts

The Delaware Supreme Court indicated Wednesday it was struggling to balance free market interests with financial benefits offered to employees in considering broad application of its opinion finding former Cantor Fitzgerald LP partners had forfeited $9 million when they jumped ship.

Among the enforcement limits the court sought to define for noncompete agreements was whether it mattered if the benefits at risk of forfeiture for any employee moving to a competitor during a non-compete period were deferred compensation or already earned. The decision may offer clarity to state courts that have split on similar questions in the absence of federal ...