Can I get out of a non-compete agreement?
Question Details:
Years ago, I signed an agreement to only buy a kind of merchandise from a supplier. All it says is that I would not buy the certain things from anyone else for 2 years after working with the company. The company has helped me by sending things to me on credit, but right now they aren't sending me enough that I can run my company. In order to keep my business alive, I have to buy from someone else, can I get out of the agreement? What could happen if I break it? What if another person buys the merchandise for me? I have a company it's under my name DBA my company name.
Non-competes of various kinds are generally enforceable. What you describe is not technically a non-compete though it has certain characteristics in common, but there is no inherent reason it would not be enforced. If you signed an agreement to not buy merchandise from anyone else for 2 years, then as long as that agreement is not seen as overly broad or long (see below), it would be enforceable. That means that if you violated it, your former company could bring a legal action for monetary damages and/or for a court order forcing you to honor its terms. Having someone else buy merchandise for you would very likely constitute a violation as well, since it would be a fairly transparent attempt to get around the agreement.
As noted, this agreement has characteristics in common with a traditional non-compete. Non-competes are often not enforceable to the extent they are so long in term or broad in geographic or market scope as to prevent someone from having a chance at earning a living. The fact an agreement is putting a burden on a person is not by itself enough to invalidate it; by their nature, non-competes are burdensome. Instead, courts will balance the scope of the agreement and its impact on the former employee against the employer's legitimate interest in reducing competition by a former employee to determine, in essence, whether it is "fair." To the exent it's not fair, courts may invalidate the agreement or reduce its scope.
The question of whether a given agreement is enforceable is very fact and situation specific. You should bring the agreement to an attorney (possibly an employment attorney) with whom you can also share all the details of your employment and industry, in order to try to determine whether an otherwise probably enforceable agreement can be voided or at least reduced in duration or scope.


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