As we have written about previously, an increasing number of states, and Washington, D.C., have limited the circumstances under which employers can bind their employees to non-compete and similar agreements, particularly when low-wage workers (however defined) are involved. The courts, however, are not immune to the trend, as evidenced by the April 21, 2022 decision from the U.S. Third Circuit Court of Appeals, ADP, Inc. v. Levin. In that case, the Third Circuit affirmed a district court’s denial of a preliminary injunction against a senior executive who had resigned from his Chief Strategy Officer position at his prior employer, ADP, to take over the Chief Executive Officer position at rival Benefitfocus.
The Washington, D.C. Ban on Non-Compete Agreements Act of 2020 (D.C. Act) is on hold once again, this time due to emergency legislation signed by Mayor Muriel Bowser earlier this week. The new legislation pushes the D.C. Act’s effective date from April 1 to October 1, 2022. As reported here, the D.C. Act is one of the most comprehensive bans on employee non-competition restrictions to date. It not only prohibits post-separation non-competes for employees working within the District (consistent with what a handful of states, including California, already do), but also rejects common “anti-moonlighting” provisions that prevent employees from working for another employer, including a competitor, during their employment.
On March 3, 2022, President Joe Biden signed the “Ending Forced Arbitration of Sexual Assault and Sexual Harassment Act of 2021” (the Act) into law. Upon signing the bill, which had bipartisan Congressional support, President Biden proclaimed, “[w]hen it comes to sexual harassment and assault, forced arbitration shielded perpetrators, silenced survivors, enabled employers to sweep episodes of sexual assault harassment under the rug and it kept survivors from knowing if others have experienced the same thing in the same workplace, at the hands of the same person.”
On August 11, 2021, the City of Philadelphia announced that in order to curb the spread of the Delta variant of COVID-19, it would be reintroducing certain mask requirements throughout the city.
As part of “a whole-of-government effort to promote competition in the American economy,” President Biden’s July 9 Executive Order on Promoting Competition in the American Economy encourages the Federal Trade Commission to ban or limit non-compete agreements. In doing so, President Biden continues — and potentially accelerates — what to date has been a piecemeal effort conducted almost exclusively at the state level to limit, and in some cases prohibit, the use of non-competes, particularly for low-wage workers.
In a decision handed down yesterday, the Supreme Court held that civil liability under the Computer Fraud and Abuse Act (“CFAA”) does not attach for employees who abuse or misuse their access credentials in accessing their current or former employers’ computer networks. Rather, to be liable under the CFAA, the employees must access databases or other electronic materials that are outside of their access rights and otherwise off-limits to them.
The case, Van Buren v. United States, arose out of the actions of a former police sergeant. The former officer, Van Buren, used his valid login credentials to search his police department database for a particular license plate number in exchange for a bribe, but was caught by an FBI sting operation. Van Buren was charged with a felony violation of the CFAA—18 U.S.C. § 1030(a)(2). An individual is liable under this section (which can carry both civil and criminal penalties) if he “intentionally accesses a computer without authorization or exceeds authorized access.” The statute defines “exceeds authorized access” to mean “to access a computer with authorization and to use such access to obtain or alter information in the computer that the accesser is not entitled so to obtain or alter.” 18 U.S.C. § 1030(e)(6).