Delaware’s Court of Chancery is the court of choice for employers seeking to enforce non-compete agreements. As Delaware practitioners know, the Court has a long-standing practice of ruling from the bench, particularly in cases in which injunctive relief is being sought and where time is of the essence. See this post on the Delaware Corporate and Commercial Litigation Blog (“Regular readers will know that transcript rulings are often cited in this court as valid authority.”) And this practice means that transcripts are an important, if not critical, source of information about how the court is likely to rule.
Vice Chancellor Glasscock served as a Master in the Court of Chancery for 12 years before being appointed to Vice Chancellor in 2011. Having been on the bench as Vice Chancellor for just a year, his non-compete opinions are limited. Which is why the transcript from a recent preliminary-injunction hearing offers Delaware counsel important insight.
Bridgeport Tank Trucks, LLC v. Smith, involved a non-compete agreement that resulted from the buyout of a business. As a result of the sale, the defendant, Mr. Smith, was subject to a restrictive covenant for a five-year period. The agreement did not contain a geographic restriction.