Hawai’i Supreme Court Enforces Non-Compete

The Supreme Court of Hawai’i recently enforced a non-competeagreement and upheld an order enjoining an employee from working as a “briefer”in the State of Hawai’i for a period of three years. (A “briefer”is “primarily hired to promote and sell products from its shop and to selloptional tours and souvenir items” to travel agencies with which theplaintiff/employer had contracted. Thereare only three briefing companies in Hawai’i.).

The court held that:

(1) training that providesskills beyond those of a general nature may be considered in weighing thereasonableness of a non-competition covenant . . ., when such training iscombined with trade secrets, confidential information, or special customerrelationships weighing in favor of a protectable business interest, (2) thefinding by the circuit court. . . that the training of a briefer such as [theemployee] is “unique” was not clearly erroneous in light of theevidence in the record, (3) under the circumstances of this case, thecourt did not abuse its discretion in ruling that the reduction in [the employee’s]salary by [the employer] did not amount to “unclean hands,” (4) thecourt did not err in ruling that [the employee] suffered irreparable harm from [theemployer’s] continued work as a briefer following her resignation, and (5) thecourt did not err in concluding that the three-year non-competition period wasreasonable.

The 7’s Enterprises, Inc. v. Del Rosario, __ P.2d __, 2006WL 2620637 (Hawai’i Sept. 13, 2006).

[Meredith R. Miller]