Delaware High Court Weighs Broad Enforcement of Forfeiture Pacts

A federal appeals court wants to know how widely to apply a Delaware Supreme Court decision finding that six former Cantor Fitzgerald LP partners were properly denied $9 million in equity payments under forfeiture-for-competition provisions in their contracts.

Delaware’s highest court hears arguments Wednesday on two questions certified from the US Court of Appeals for the Seventh Circuit about its Jan. 29 Cantor Fitzgerald opinion. Attorneys say it’s an opportunity to clarify an area of employment law where state courts have split on companies’ ability to enforce non-compete agreements, namely the ruling’s applicability to employees outside limited partnership agreements. ...