Tag Archives: business

Massachusetts Noncompetition Agreements: Consideration

By on March 1, 2016

We have discussed the basics of non-competition agreements (“non-competes”) in Massachusetts, particularly the need to have reasonable restrictions supporting a “legitimate business interest.” Non-competes often include additional restrictions, such as non-solicitation and nondisclosure clauses. Beyond that, non-competes usually contain several provisions commonly found in legal documents. This post is the first in a series covering terms commonly found in non-competes.


Every contract must include “consideration,” and non-competes are no exception. “Consideration” is the benefit that each side receives from a contract. Without valid consideration for each party to a contract, the contract will not be enforceable. In the employment context, it is very common for employers to have employees sign non-competes when they are hired. In Massachusetts, a job offer is valid consideration for an employee entering a non-compete agreement: the employee receives a job offer, while the employer receives the employee’s willingness to agree not to compete with the employer. Thus, employers are wise to have employees sign any restrictive contracts when the employee is hired.

However, sometimes non-competes are not signed when the employee is hired. If employment has already begun, an employer has two options. One option is use “continued employment” as consideration. The Massachusetts Appeals Court has held that continued employment is valid consideration (Wilkinson v. QCC, Inc., 53 Mass. App. Ct. 1109 (2001)), which is consistent with other jurisdictions, but the Supreme Judicial Court has not addressed the issue. For any employers concerned that a future court may find continued employment to be insufficient (and to oppose an employee’s argument that the agreement was only signed under duress), employers should consider offering additional consideration: a raise, a promotion, a bonus, more vacation time, and the like, along with continued employment.   

Although consideration often seems like an obvious part of any contract, it is vitally important. Any effective litigator will pick apart a contract to argue that adequate consideration was not provided, rendering the contract unenforceable. Consideration should be specifically discussed in the contract and actually provided to the employee (in other words, do not promise what you cannot deliver).

Material Change

While a job offer is valid consideration, if the employee’s job substantially changes, the non-compete may not be valid. This is based on a legal concept called “material change.” The argument is that if the employee’s new job is so different from the job that they were hired to do (and the job that served as consideration to sign the non-compete), consideration is no longer present and thus the non-compete is unenforceable. Massachusetts courts are divided on the issue, with some holding that only a reduction in the employee’s pay is a sufficient change to void the non-compete. Other courts have found that if an employee is promoted and given new responsibilities, a non-compete signed when first employed is likely unenforceable. As is often the case, the enforceability of a non-compete can be a fact-intensive endeavor. Both employers and employees should consult with an experienced Massachusetts employment attorney to determine their rights and options.

Online Business Defamation: A New Frontier

By on May 5, 2015

The explosion of business review websites and social media applications brings not only opportunities for businesses to get exposure, but also risks of very public negative commentary.  While everyone is entitled to express opinions, that entitlement does not extend to protection for posting demonstratively false statements of fact about businesses online. It is imperative for business owners to monitor online rating websites and relevant social media forums, in order to quickly spot reputation-harming online business defamation. The longer the posts remain up, the greater the potential harm to the business.   

You’ve Spotted a Defamatory Post- Now What?  

When confronted with online defamation businesses have few options.   First, a business may contact the host website to request removal of the defamatory post.  Websites have a wide range of policies regarding online business defamation. Some will directly review and remove clearly defamatory comments, some will do nothing whatsoever, and some fall on the spectrum in between. Second, the business owner may try contacting the author, to reconcile differences and have them voluntarily remove the post. Finally, if the first two options fail or are seemingly unavailable, the next step may be to consider consulting an attorney and pursuing a legal remedy.

Legal Framework of an Online Business Defamation Claim

In Massachusetts, there are five elements that comprise an online business defamation claim. A business must prove, “(1) that the defendant published a written statement; (2) of and concerning the plaintiff; that was both (3) defamatory, and (4) false; and (5) either caused economic loss, or is actionable without proof of economic loss.” Noonan v. Staples, 556 F.3d 20 (1st Cir. 2009). Further, a statement is considered defamatory when it, “may reasonably be read as discrediting [the business] in the minds of any considerable and respectable class of the community.” Clay Corp. v. Colter, 2012 Mass. Super. LEXIS 357 (Mass. Super. Ct. 2012). It is also worth noting that, in the context of online business defamation, federal law limits who businesses can hold legally responsible for defamatory postings. Businesses can generally bring a claim only against the actual author of the defamatory comments and not the hosting website where the comments are posted. 

A recent Massachusetts case, Clay Corp. v. Colter (Mass. Super. Ct. 2012), signaled that it is possible for a business to make a viable case against the author of online defamatory comments. In that case the court entered judgment in favor of the defamed business, finding the authors liable for $750,000, to compensate for the defamatory impact to the business. The court, however, stopped short of ordering that the authors remove the offending posts, citing First Amendment free speech as a limiting factor. Thus, while courts are seemingly willing to rule in favor of defamed businesses the First Amendment may impede full relief.    


The Internet can be a business’s best friend just as easily as it can be a business’s worst enemy. Online posts are immediate and far-reaching, so reaction must be swift. Thus, it is vitally important to police what is said online and understand what options and legal remedies are available to protect your business and your livelihood from online business defamation.

For more information contact Chris Strang. Partner at Strang, Scott, Giroux, & Young, LLP.