Food supplier prevents former employee soliciting its customers

A food supplier has been granted an injunction to prevent a former employee from soliciting its customers for a rival business. 

The case involved Fresh Asia Foods Ltd, which specialised in supplying Chinese foods to shops and restaurants.

The former employee had worked as its marketing manager. There was a non-solicitation clause in his employment contract prohibiting him from soliciting any business from the supplier's current or potential customers for a 12-month period after termination of his employment.

There was also a non-competition clause prohibiting him from competing with the supplier’s business during his employment and for 12-months post-termination. 

The employee left the supplier to work for a rival company. The supplier took legal action to enforce the post-termination restrictions. It sought an interim injunction pending trial. 

In giving its judgment, the court said post-termination restraints that were reasonable in terms of space or time were likely to be enforced. It was for the employer to show that a restraint was reasonable for protecting its interest, such as confidential information and customer lists: the right did not extend to mere potential customers.

Non-solicitation clauses were more favourably looked on than non-competition clauses because an employer was not entitled to protect itself against mere competition on the part of a former employee.

The court therefore granted the injunction in relation to the non-solicitation clause. However, it declined to enforce the non-competition clause because it was wider than reasonably necessary to protect the supplier’s confidential information or trade connections. 

Please contact us if you would like more information about employment contracts and protecting your business.

 

Case details
[2018] EWHC 3644 (Ch)
FRESHASIA FOODS LTD v JING LU (2019)

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