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Advice on clients, NDAs and moving businesses

Thread title: Advice on clients, NDAs and moving businesses
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01-27-2013, 07:59 PM
nobodyisme is offline nobodyisme
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  Old  Advice on clients, NDAs and moving businesses

I've been freelancing with a view to becoming part of a small design/SEO agency. It's not worked out for various reasons. I have signed one NDA, and one contract saying I can't steal clients, past or present etc.

I am returning to being a freelancer and cutting ties with this company, but one of the clients I brought on board who wants to work with me personally.

Obviously, I cannot take the client and do work freelance for him as it breaches the contract. The client is a friend of one of my friends, so I want to make him aware of the situation.

Is telling the client that I;m leaving in breach of the NDA (i.e. it's not in the best interests of the business for him to know this situation, as he might leave).

Secondly, if I was to work for another separate company, and this client came on board with that company (not me personally, nor a business that I owned), would that be the considered 'stealing' the client in terms of a contract?

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01-30-2013, 01:32 PM
Lowengard is offline Lowengard
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You probably need to consult a lawyer with experience in contract law in your state or region. I am not a lawyer so my opinions here are just that.

You can't get around the idea that, in the spirit of the NDA/non-compete, you take nothing and no-one with you. You have an ethical obligation to not harm the company once you leave. Or to not harm the company any more than no-longer-working-for-it would do.

But if the contract statements (the NDA and non-compete) are not carefully worded they may be unenforcable. I'm pretty sure a non-compete can't prohibit you from doing any work in your field unless you move to another city. Another important point is the length of time you are not allowed to compete. In some cases, the contracts need to spell out what not competing actually means. Taking back a client you brought with you is probably not outlined unless you asked for clarification but there are probably precedents in your field that would suggest a norm.

NDAs are, likewise, tricky. Once you're not an employee a company can't control your associations or your comments. Defamatory language however would certainly spark some kind of action. You probably could tell this former clients or associates that you left because "it didn't work out." You probably could not tell them that you left because "they're a bunch of @*(&#) morons who are going to be out of business in 6 months."

Keep in mind, too, that these contracts are often brought in to frighten employees and there really is no mechanism to act on them. So, if you take back one client worth $10,000pa when the business revenue is $1,000,000 the company might cut its losses--the cost of prosecution would probably be more than what they'd recover and it takes time to do this. If a quarter of their client base migrates to you over the next 18 months though...that's another thing entirely.

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