Prudential Locations, LLC v. Gagnon
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In this case concerning the enforceability of a non-compete agreement the Supreme Court vacated the intermediate court of appeals' judgment on appeal and the circuit court's final order in favor of Lorna Gagnon with respect to her alleged breach of a non-solicitation clause as to one real estate agent but otherwise affirmed, holding that a genuine issue of material fact precluded summary judgment as to this issue.
A non-compete agreement restricted Gagnon, a former employee of Prudential Locations, LLC, from establishing her own brokerage firm in Hawaii within one year after terminating her employment with Locations and from soliciting persons employed or affiliated with Locations. The Supreme Court held (1) the ICA erroneously failed to address whether the non-compete and non-solicitation clauses were ancillary to a legitimate purpose not violative of Haw. Rev. Stat. Chapter 480; (2) restricting competition is not a legitimate ancillary purpose; (3) to establish a violation of a non-solicitation clause, there must be evidence that the person subjective to the clause actively initiated contact; and (4) as to the non-compete clause, summary judgment was proper, but as to the non-solicitation clause, a genuine issue of material fact existed regarding whether Gagnon actively initiated contact.
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