Can a contract which lacks a non-compete clause but contains a standard confidentiality agreement prevent me from starting a business in the same field?

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Can a contract which lacks a non-compete clause but contains a standard confidentiality agreement prevent me from starting a business in the same field?

I am under a confidentiality agreement in a contract which lacks a non-compete clause. The confidentiality agreement appears to be pretty standard to a layman – including product plans, services, and markets. Can this restrict me from starting a new business with similar services but different methods?

Asked on February 22, 2012 under Employment Labor Law, Minnesota

Answers:

SJZ, Member, New York Bar / FreeAdvice Contributing Attorney

Answered 9 years ago | Contributor

As a general matter, any one may start any business, or work for anyone they want, so long as there is no non-competition clause. An employee may not use proprietary information from employer A for the benefit of employer B (or his own business), however, even when there is no contract or agreement specifying this--so, for example, an employee may not take his or her employer's customer list to use for his own benefit.

The confidentiality agreement will impose whatever other restrictions on you which it contains. So long as you do not violate the restrictions in the agreement, and do not generally misappropriate proprietary information, you should be abole to start a competing business.


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