open-agreements 0.7.6 → 0.7.7
This diff represents the content of publicly available package versions that have been released to one of the supported registries. The information contained in this diff is provided for informational purposes only and reflects changes between package versions as they appear in their respective public registries.
- package/README.md +1 -1
- package/content/templates/openagreements-due-diligence-request-list/template.docx +0 -0
- package/content/templates/openagreements-due-diligence-request-list/template.md +1 -1
- package/dist/core/fill-pipeline.d.ts.map +1 -1
- package/dist/core/fill-pipeline.js +0 -8
- package/dist/core/fill-pipeline.js.map +1 -1
- package/dist/core/unified-pipeline.d.ts.map +1 -1
- package/dist/core/unified-pipeline.js +4 -6
- package/dist/core/unified-pipeline.js.map +1 -1
- package/gemini-extension.json +1 -1
- package/node_modules/@xmldom/xmldom/CHANGELOG.md +939 -0
- package/node_modules/@xmldom/xmldom/LICENSE +8 -0
- package/node_modules/@xmldom/xmldom/SECURITY.md +50 -0
- package/node_modules/@xmldom/xmldom/index.d.ts +1664 -0
- package/node_modules/@xmldom/xmldom/lib/.eslintrc.yml +3 -0
- package/node_modules/@xmldom/xmldom/lib/conventions.js +429 -0
- package/node_modules/@xmldom/xmldom/lib/dom-parser.js +586 -0
- package/node_modules/@xmldom/xmldom/lib/dom.js +3192 -0
- package/node_modules/@xmldom/xmldom/lib/entities.js +2171 -0
- package/node_modules/@xmldom/xmldom/lib/errors.js +202 -0
- package/node_modules/@xmldom/xmldom/lib/grammar.js +533 -0
- package/node_modules/@xmldom/xmldom/lib/index.js +41 -0
- package/node_modules/@xmldom/xmldom/lib/sax.js +929 -0
- package/node_modules/@xmldom/xmldom/package.json +74 -0
- package/node_modules/@xmldom/xmldom/readme.md +364 -0
- package/node_modules/core-util-is/LICENSE +19 -0
- package/node_modules/core-util-is/README.md +3 -0
- package/node_modules/core-util-is/lib/util.js +107 -0
- package/node_modules/core-util-is/package.json +38 -0
- package/node_modules/immediate/LICENSE.txt +20 -0
- package/node_modules/immediate/README.md +93 -0
- package/node_modules/immediate/dist/immediate.js +75 -0
- package/node_modules/immediate/dist/immediate.min.js +1 -0
- package/node_modules/immediate/lib/browser.js +69 -0
- package/node_modules/immediate/lib/index.js +73 -0
- package/node_modules/immediate/package.json +42 -0
- package/node_modules/inherits/LICENSE +16 -0
- package/node_modules/inherits/README.md +42 -0
- package/node_modules/inherits/inherits.js +9 -0
- package/node_modules/inherits/inherits_browser.js +27 -0
- package/node_modules/inherits/package.json +29 -0
- package/node_modules/isarray/.npmignore +1 -0
- package/node_modules/isarray/.travis.yml +4 -0
- package/node_modules/isarray/Makefile +6 -0
- package/node_modules/isarray/README.md +60 -0
- package/node_modules/isarray/component.json +19 -0
- package/node_modules/isarray/index.js +5 -0
- package/node_modules/isarray/package.json +45 -0
- package/node_modules/isarray/test.js +20 -0
- package/node_modules/jszip/.codeclimate.yml +16 -0
- package/node_modules/jszip/.editorconfig +8 -0
- package/node_modules/jszip/.eslintrc.js +43 -0
- package/node_modules/jszip/.github/workflows/pr.yaml +58 -0
- package/node_modules/jszip/.jekyll-metadata +0 -0
- package/node_modules/jszip/.travis.yml +17 -0
- package/node_modules/jszip/CHANGES.md +204 -0
- package/node_modules/jszip/LICENSE.markdown +651 -0
- package/node_modules/jszip/README.markdown +33 -0
- package/node_modules/jszip/deps.js +37 -0
- package/node_modules/jszip/dist/jszip.js +11577 -0
- package/node_modules/jszip/dist/jszip.min.js +13 -0
- package/node_modules/jszip/graph.svg +601 -0
- package/node_modules/jszip/index.d.ts +330 -0
- package/node_modules/jszip/lib/base64.js +106 -0
- package/node_modules/jszip/lib/compressedObject.js +74 -0
- package/node_modules/jszip/lib/compressions.js +14 -0
- package/node_modules/jszip/lib/crc32.js +77 -0
- package/node_modules/jszip/lib/defaults.js +11 -0
- package/node_modules/jszip/lib/external.js +18 -0
- package/node_modules/jszip/lib/flate.js +85 -0
- package/node_modules/jszip/lib/generate/ZipFileWorker.js +539 -0
- package/node_modules/jszip/lib/generate/index.js +57 -0
- package/node_modules/jszip/lib/index.js +55 -0
- package/node_modules/jszip/lib/license_header.js +11 -0
- package/node_modules/jszip/lib/load.js +88 -0
- package/node_modules/jszip/lib/nodejs/NodejsStreamInputAdapter.js +74 -0
- package/node_modules/jszip/lib/nodejs/NodejsStreamOutputAdapter.js +42 -0
- package/node_modules/jszip/lib/nodejsUtils.js +57 -0
- package/node_modules/jszip/lib/object.js +384 -0
- package/node_modules/jszip/lib/readable-stream-browser.js +10 -0
- package/node_modules/jszip/lib/reader/ArrayReader.js +57 -0
- package/node_modules/jszip/lib/reader/DataReader.js +116 -0
- package/node_modules/jszip/lib/reader/NodeBufferReader.js +19 -0
- package/node_modules/jszip/lib/reader/StringReader.js +38 -0
- package/node_modules/jszip/lib/reader/Uint8ArrayReader.js +22 -0
- package/node_modules/jszip/lib/reader/readerFor.js +28 -0
- package/node_modules/jszip/lib/signature.js +7 -0
- package/node_modules/jszip/lib/stream/ConvertWorker.js +26 -0
- package/node_modules/jszip/lib/stream/Crc32Probe.js +24 -0
- package/node_modules/jszip/lib/stream/DataLengthProbe.js +29 -0
- package/node_modules/jszip/lib/stream/DataWorker.js +116 -0
- package/node_modules/jszip/lib/stream/GenericWorker.js +263 -0
- package/node_modules/jszip/lib/stream/StreamHelper.js +214 -0
- package/node_modules/jszip/lib/support.js +38 -0
- package/node_modules/jszip/lib/utf8.js +275 -0
- package/node_modules/jszip/lib/utils.js +501 -0
- package/node_modules/jszip/lib/zipEntries.js +261 -0
- package/node_modules/jszip/lib/zipEntry.js +293 -0
- package/node_modules/jszip/lib/zipObject.js +133 -0
- package/node_modules/jszip/package.json +67 -0
- package/node_modules/jszip/sponsors.md +21 -0
- package/node_modules/jszip/tsconfig.json +101 -0
- package/node_modules/jszip/vendor/FileSaver.js +247 -0
- package/node_modules/lie/README.md +62 -0
- package/node_modules/lie/dist/lie.js +350 -0
- package/node_modules/lie/dist/lie.min.js +1 -0
- package/node_modules/lie/dist/lie.polyfill.js +358 -0
- package/node_modules/lie/dist/lie.polyfill.min.js +1 -0
- package/node_modules/lie/lib/browser.js +273 -0
- package/node_modules/lie/lib/index.js +298 -0
- package/node_modules/lie/license.md +7 -0
- package/node_modules/lie/lie.d.ts +244 -0
- package/node_modules/lie/package.json +69 -0
- package/node_modules/lie/polyfill.js +4 -0
- package/node_modules/pako/LICENSE +21 -0
- package/node_modules/pako/README.md +191 -0
- package/node_modules/pako/dist/pako.js +6818 -0
- package/node_modules/pako/dist/pako.min.js +1 -0
- package/node_modules/pako/dist/pako_deflate.js +3997 -0
- package/node_modules/pako/dist/pako_deflate.min.js +1 -0
- package/node_modules/pako/dist/pako_inflate.js +3300 -0
- package/node_modules/pako/dist/pako_inflate.min.js +1 -0
- package/node_modules/pako/index.js +14 -0
- package/node_modules/pako/lib/deflate.js +400 -0
- package/node_modules/pako/lib/inflate.js +423 -0
- package/node_modules/pako/lib/utils/common.js +105 -0
- package/node_modules/pako/lib/utils/strings.js +187 -0
- package/node_modules/pako/lib/zlib/README +59 -0
- package/node_modules/pako/lib/zlib/adler32.js +51 -0
- package/node_modules/pako/lib/zlib/constants.js +68 -0
- package/node_modules/pako/lib/zlib/crc32.js +59 -0
- package/node_modules/pako/lib/zlib/deflate.js +1874 -0
- package/node_modules/pako/lib/zlib/gzheader.js +58 -0
- package/node_modules/pako/lib/zlib/inffast.js +345 -0
- package/node_modules/pako/lib/zlib/inflate.js +1556 -0
- package/node_modules/pako/lib/zlib/inftrees.js +343 -0
- package/node_modules/pako/lib/zlib/messages.js +32 -0
- package/node_modules/pako/lib/zlib/trees.js +1222 -0
- package/node_modules/pako/lib/zlib/zstream.js +47 -0
- package/node_modules/pako/package.json +44 -0
- package/node_modules/process-nextick-args/index.js +45 -0
- package/node_modules/process-nextick-args/license.md +19 -0
- package/node_modules/process-nextick-args/package.json +25 -0
- package/node_modules/process-nextick-args/readme.md +18 -0
- package/node_modules/readable-stream/.travis.yml +34 -0
- package/node_modules/readable-stream/CONTRIBUTING.md +38 -0
- package/node_modules/readable-stream/GOVERNANCE.md +136 -0
- package/node_modules/readable-stream/LICENSE +47 -0
- package/node_modules/readable-stream/README.md +58 -0
- package/node_modules/readable-stream/doc/wg-meetings/2015-01-30.md +60 -0
- package/node_modules/readable-stream/duplex-browser.js +1 -0
- package/node_modules/readable-stream/duplex.js +1 -0
- package/node_modules/readable-stream/lib/_stream_duplex.js +131 -0
- package/node_modules/readable-stream/lib/_stream_passthrough.js +47 -0
- package/node_modules/readable-stream/lib/_stream_readable.js +1019 -0
- package/node_modules/readable-stream/lib/_stream_transform.js +214 -0
- package/node_modules/readable-stream/lib/_stream_writable.js +685 -0
- package/node_modules/readable-stream/lib/internal/streams/BufferList.js +78 -0
- package/node_modules/readable-stream/lib/internal/streams/destroy.js +84 -0
- package/node_modules/readable-stream/lib/internal/streams/stream-browser.js +1 -0
- package/node_modules/readable-stream/lib/internal/streams/stream.js +1 -0
- package/node_modules/readable-stream/package.json +52 -0
- package/node_modules/readable-stream/passthrough.js +1 -0
- package/node_modules/readable-stream/readable-browser.js +7 -0
- package/node_modules/readable-stream/readable.js +19 -0
- package/node_modules/readable-stream/transform.js +1 -0
- package/node_modules/readable-stream/writable-browser.js +1 -0
- package/node_modules/readable-stream/writable.js +8 -0
- package/node_modules/safe-buffer/LICENSE +21 -0
- package/node_modules/safe-buffer/README.md +584 -0
- package/node_modules/safe-buffer/index.d.ts +187 -0
- package/node_modules/safe-buffer/index.js +62 -0
- package/node_modules/safe-buffer/package.json +37 -0
- package/node_modules/setimmediate/LICENSE.txt +20 -0
- package/node_modules/setimmediate/package.json +30 -0
- package/node_modules/setimmediate/setImmediate.js +186 -0
- package/node_modules/string_decoder/.travis.yml +50 -0
- package/node_modules/string_decoder/LICENSE +48 -0
- package/node_modules/string_decoder/README.md +47 -0
- package/node_modules/string_decoder/lib/string_decoder.js +296 -0
- package/node_modules/string_decoder/package.json +31 -0
- package/node_modules/util-deprecate/History.md +16 -0
- package/node_modules/util-deprecate/LICENSE +24 -0
- package/node_modules/util-deprecate/README.md +53 -0
- package/node_modules/util-deprecate/browser.js +67 -0
- package/node_modules/util-deprecate/node.js +6 -0
- package/node_modules/util-deprecate/package.json +27 -0
- package/package.json +1 -1
- package/skills/client-email/SKILL.md +8 -6
- package/skills/employment-contract/SKILL.md +23 -6
- package/skills/non-compete-contract-explainer/content/alabama.md +251 -0
- package/skills/non-compete-contract-explainer/content/alaska.md +160 -0
- package/skills/non-compete-contract-explainer/content/american-samoa.md +187 -0
- package/skills/non-compete-contract-explainer/content/arizona.md +293 -0
- package/skills/non-compete-contract-explainer/content/arkansas.md +235 -0
- package/skills/non-compete-contract-explainer/content/california.md +270 -0
- package/skills/non-compete-contract-explainer/content/cnmi.md +168 -0
- package/skills/non-compete-contract-explainer/content/colorado.md +277 -0
- package/skills/non-compete-contract-explainer/content/connecticut.md +220 -0
- package/skills/non-compete-contract-explainer/content/delaware.md +222 -0
- package/skills/non-compete-contract-explainer/content/district-of-columbia.md +263 -0
- package/skills/non-compete-contract-explainer/content/florida.md +267 -0
- package/skills/non-compete-contract-explainer/content/georgia.md +323 -0
- package/skills/non-compete-contract-explainer/content/guam.md +180 -0
- package/skills/non-compete-contract-explainer/content/hawaii.md +236 -0
- package/skills/non-compete-contract-explainer/content/idaho.md +258 -0
- package/skills/non-compete-contract-explainer/content/illinois.md +266 -0
- package/skills/non-compete-contract-explainer/content/india.md +269 -0
- package/skills/non-compete-contract-explainer/content/indiana.md +253 -0
- package/skills/non-compete-contract-explainer/content/iowa.md +232 -0
- package/skills/non-compete-contract-explainer/content/kansas.md +227 -0
- package/skills/non-compete-contract-explainer/content/kentucky.md +201 -0
- package/skills/non-compete-contract-explainer/content/louisiana.md +272 -0
- package/skills/non-compete-contract-explainer/content/maine.md +178 -0
- package/skills/non-compete-contract-explainer/content/maryland.md +244 -0
- package/skills/non-compete-contract-explainer/content/massachusetts.md +272 -0
- package/skills/non-compete-contract-explainer/content/michigan.md +222 -0
- package/skills/non-compete-contract-explainer/content/minnesota.md +171 -0
- package/skills/non-compete-contract-explainer/content/mississippi.md +237 -0
- package/skills/non-compete-contract-explainer/content/missouri.md +219 -0
- package/skills/non-compete-contract-explainer/content/montana.md +202 -0
- package/skills/non-compete-contract-explainer/content/nebraska.md +206 -0
- package/skills/non-compete-contract-explainer/content/nevada.md +278 -0
- package/skills/non-compete-contract-explainer/content/new-hampshire.md +233 -0
- package/skills/non-compete-contract-explainer/content/new-jersey.md +277 -0
- package/skills/non-compete-contract-explainer/content/new-mexico.md +244 -0
- package/skills/non-compete-contract-explainer/content/new-york.md +226 -0
- package/skills/non-compete-contract-explainer/content/north-carolina.md +346 -0
- package/skills/non-compete-contract-explainer/content/north-dakota.md +187 -0
- package/skills/non-compete-contract-explainer/content/ohio.md +207 -0
- package/skills/non-compete-contract-explainer/content/oklahoma.md +196 -0
- package/skills/non-compete-contract-explainer/content/oregon.md +359 -0
- package/skills/non-compete-contract-explainer/content/pennsylvania.md +254 -0
- package/skills/non-compete-contract-explainer/content/philippines.md +211 -0
- package/skills/non-compete-contract-explainer/content/puerto-rico.md +163 -0
- package/skills/non-compete-contract-explainer/content/rhode-island.md +171 -0
- package/skills/non-compete-contract-explainer/content/singapore.md +229 -0
- package/skills/non-compete-contract-explainer/content/south-carolina.md +226 -0
- package/skills/non-compete-contract-explainer/content/south-dakota.md +222 -0
- package/skills/non-compete-contract-explainer/content/tennessee.md +251 -0
- package/skills/non-compete-contract-explainer/content/texas.md +297 -0
- package/skills/non-compete-contract-explainer/content/us-virgin-islands.md +193 -0
- package/skills/non-compete-contract-explainer/content/utah.md +250 -0
- package/skills/non-compete-contract-explainer/content/vermont.md +193 -0
- package/skills/non-compete-contract-explainer/content/virginia.md +213 -0
- package/skills/non-compete-contract-explainer/content/washington.md +296 -0
- package/skills/non-compete-contract-explainer/content/west-virginia.md +187 -0
- package/skills/non-compete-contract-explainer/content/wisconsin.md +293 -0
- package/skills/non-compete-contract-explainer/content/wyoming.md +55 -45
- package/skills/non-compete-contract-explainer/manifest.json +523 -1
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---
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jurisdiction: "Michigan"
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slug: michigan
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countryCode: US
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snapshotAsOf: "2026-06-08"
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lastReviewed: "2026-06-03"
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canonicalUrl: https://openagreements.org/legal/non-compete/michigan
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license: CC BY 4.0
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stale: false
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---
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> [!IMPORTANT]
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> **Informational only — not legal advice.** This is a snapshot of an OpenAgreements practice note,
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> provided for general information. It is not legal advice, does not create an attorney-client
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> relationship, and is not a substitute for a licensed attorney in the relevant jurisdiction.
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> Laws change; verify against the canonical version before relying on it.
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>
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> **Canonical:** https://openagreements.org/legal/non-compete/michigan · **Snapshot as of:** 2026-06-08 · License: CC BY 4.0 · © UseJunior
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# Non-Competes in Michigan[^about]
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Michigan enforces employee non-competes only when they are reasonable under MCL 445.774a, judges business-to-business covenants under the antitrust rule of reason, and gives courts discretion to limit overbroad covenants rather than voiding them outright.
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## At a glance
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| Question | Michigan |
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| --- | --- |
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| **Are non-competes enforceable?** | Allowed if reasonable |
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| **Bottom line** | Michigan enforces an employee non-compete if it protects a reasonable competitive business interest and is reasonable in duration, geography, and type of employment, with no categorical worker or profession ban. |
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| **Main law or case** | MCL § 445.774a; St. Clair Medical, P.C. v. Borgiel, 270 Mich. App. 260 (2006) |
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| **Main exceptions** | B2B/sale-of-business covenants judged under antitrust rule of reason; no physician or profession ban |
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| **Can a court narrow it?** | Yes — rewrites to reasonable |
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| **Applies to contractors?** | Unclear |
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| **Restriction extended during a breach?** | Unsettled |
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| **Maximum length set by law** | No fixed numeric cap |
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## Are employee non-compete agreements enforceable in Michigan? {#employee-noncompetes}
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**Short answer.** Yes, sometimes. Michigan is a reasonableness state, not a general-ban state: MCL 445.774a lets an employer enforce a covenant that protects a reasonable competitive business interest and is reasonable in duration, geographic area, and the type of employment restricted [^mcl-774a-employer-may-obtain][^borgiel-unfair-advantage].
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The governing statute is part of the Michigan Antitrust Reform Act. A covenant is valid only if it does more than block ordinary competition — under *St. Clair Medical, P.C. v. Borgiel* it must protect against the employee gaining an *unfair* competitive advantage and may not stop the employee from using general knowledge or skill [^borgiel-unfair-advantage].
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"To be reasonable in relation to an employer's competitive business interest, a restrictive covenant must protect against the employee's gaining some unfair advantage in competition with the employer, but not prohibit the employee from using general knowledge or skill."[^borgiel-unfair-advantage]
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> [!NOTE]
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> **Practice note.**
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> Do not treat Michigan as a total-ban state, and do not assume a covenant is enforceable just because the statute permits non-competes. Start with the reasonable-competitive-business-interest test and the duration, geography, and type-of-employment limits, because a covenant that merely suppresses competition fails even though the statute allows non-competes [^mcl-774a-employer-may-obtain][^borgiel-unfair-advantage].
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## What legitimate business interests can support a Michigan non-compete? {#protectable-interests}
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**Short answer.** Confidential information, customer relationships, and trade secrets are the core interests that justify a Michigan restraint; general skill and knowledge are not protectable [^follmer-confidential-info][^borgiel-general-skill][^mutsa-trade-secret-definition].
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In *Follmer, Rudzewicz & Co., P.C. v. Kosco*, the Michigan Supreme Court held that a covenant is enforceable to the extent it reasonably protects the employer's confidential information, and unenforceable to the extent it reaches further [^follmer-confidential-info]. *Borgiel* draws the same line on the employee side: the covenant cannot bar the use of general knowledge or skill [^borgiel-general-skill].
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The Michigan Uniform Trade Secrets Act supplies the trade-secret overlay. A trade secret is information that derives independent economic value from not being generally known and is the subject of reasonable secrecy efforts [^mutsa-trade-secret-definition].
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"To the extent such an agreement provides reasonable protection for the confidential information of the employer, it does not violate the statute and is enforceable."[^follmer-confidential-info]
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61
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+
## How long and how broad can a Michigan non-compete be? {#duration-geography}
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62
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+
|
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63
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+
**Short answer.** There is no fixed numeric cap. MCL 445.774a requires the duration, geographic area, and type of employment to be reasonable, and whether a covenant clears that bar is a question of law when the facts are undisputed [^mcl-774a-reasonable-scope][^coates-question-of-law].
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64
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+
|
|
65
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+
Reasonableness is fact-specific, but the outer bounds are clear: in *Mid Michigan Medical Billing Service, Inc. v. Williams*, the Court of Appeals held that a restriction with unlimited duration and geographic reach on working for any past or current client was unreasonable [^mid-michigan-unlimited]. *Coates v. Bastian Brothers, Inc.* confirms a court decides reasonableness as a matter of law when the underlying facts are not in dispute [^coates-question-of-law].
|
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66
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+
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67
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+
"The reasonableness of a noncompetition provision is a question of law when the relevant facts are undisputed."[^coates-question-of-law]
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|
68
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+
|
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69
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+
> [!CAUTION]
|
|
70
|
+
> **Drafting note.**
|
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71
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+
>
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|
72
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+
> Tie duration, geography, and covered activity to the specific interest the covenant protects rather than copying a long default term. *Mid Michigan Billing* shows that an unlimited or open-ended client restriction is vulnerable as unreasonable, so a narrower, interest-matched scope is more defensible [^mcl-774a-reasonable-scope][^mid-michigan-unlimited].
|
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73
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+
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74
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+
## Is continued employment enough consideration for a Michigan non-compete? {#continued-employment-consideration}
|
|
75
|
+
|
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76
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+
**Short answer.** For a genuine at-will employee, usually yes — but it is not automatic. *QIS, Inc. v. Industrial Quality Control, Inc.* states the rule that mere continuation of at-will employment is sufficient consideration, yet *QIS* itself held the covenant void for lack of consideration because the workers were just-cause employees [^qis-continued-employment][^qis-just-cause].
|
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77
|
+
|
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78
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+
The outcome in *QIS* is the cautionary part. The court agreed the agreement was void because the employees could not be dismissed without just cause, so their continued employment did not supply consideration for signing a new restraint [^qis-just-cause]. The at-will rule it recited (drawn from federal authority applying Michigan law) governs only when employment really is at will.
|
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79
|
+
|
|
80
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+
"Mere continuation of employment is sufficient consideration to support a noncompete agreement in an at-will employment setting."[^qis-continued-employment]
|
|
81
|
+
|
|
82
|
+
> [!CAUTION]
|
|
83
|
+
> **Drafting note.**
|
|
84
|
+
>
|
|
85
|
+
> For a non-at-will or just-cause employee, do not rely on continued employment alone as consideration. *QIS* held a covenant void in that setting because refusing to sign would not have been just cause for termination, so provide separate, identifiable consideration when the worker is not at will [^qis-just-cause].
|
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86
|
+
|
|
87
|
+
## Can a Michigan court rewrite or limit an overbroad non-compete? {#court-narrowing}
|
|
88
|
+
|
|
89
|
+
**Short answer.** Yes. MCL 445.774a expressly lets a court limit a covenant it finds unreasonable and enforce it as limited, so Michigan is a statutory blue-pencil state [^mcl-774a-court-may-limit].
|
|
90
|
+
|
|
91
|
+
This power is real but discretionary, not guaranteed. In *Mid Michigan Medical Billing Service, Inc. v. Williams*, the court confirmed that MCL 445.774a lets a court modify an unreasonable covenant to render it reasonable and enforceable rather than void it outright [^mid-michigan-limited].
|
|
92
|
+
|
|
93
|
+
"To the extent any such agreement or covenant is found to be unreasonable in any respect, a court may limit the agreement to render it reasonable in light of the circumstances in which it was made and specifically enforce the agreement as limited."[^mcl-774a-court-may-limit]
|
|
94
|
+
|
|
95
|
+
> [!CAUTION]
|
|
96
|
+
> **Drafting note.**
|
|
97
|
+
>
|
|
98
|
+
> Because the statute says a court *may* limit an overbroad covenant, not that it must, do not rely on judicial narrowing as a safety net. Draft scope, geography, and duration to the minimum the protectable interest requires, since a court may decline to save a covenant it views as punitive [^mcl-774a-court-may-limit][^mid-michigan-limited].
|
|
99
|
+
|
|
100
|
+
## Are Michigan business-to-business or sale-of-business non-competes judged differently? {#business-to-business}
|
|
101
|
+
|
|
102
|
+
**Short answer.** Yes. The Michigan Supreme Court held in *Innovation Ventures, LLC v. Liquid Manufacturing, LLC* that commercial non-competes between businesses are evaluated under the antitrust rule of reason, not the MCL 445.774a employee test [^innovation-rule-of-reason].
|
|
103
|
+
|
|
104
|
+
The rule of reason flows from the Michigan Antitrust Reform Act, which makes contracts in restraint of trade in a relevant market unlawful and directs courts to give due deference to federal antitrust interpretations [^mcl-772-restraint][^mcl-784-federal-deference]. That standard is different from the employee test: a true commercial or transaction-ancillary restraint is analyzed for its market context and competitive effect rather than under MCL 445.774a's duration, geography, and type-of-employment framework.
|
|
105
|
+
|
|
106
|
+
"Commercial noncompete agreements between businesses should be evaluated under the rule of reason, and federal court interpretations of the rule of reason should be given due deference."[^innovation-rule-of-reason]
|
|
107
|
+
|
|
108
|
+
> [!NOTE]
|
|
109
|
+
> **Practice note.**
|
|
110
|
+
>
|
|
111
|
+
> Identify which framework applies before assessing a covenant. *Innovation Ventures* routes true commercial covenants, including transaction-ancillary covenants, to the antitrust rule of reason, so applying the MCL 445.774a employee duration-geography test to a genuine business-to-business covenant analyzes it under the wrong standard [^innovation-rule-of-reason][^mcl-772-restraint].
|
|
112
|
+
|
|
113
|
+
## What special non-compete issues affect Michigan physicians? {#physician-rules}
|
|
114
|
+
|
|
115
|
+
**Short answer.** Michigan does not categorically ban physician non-competes — they are analyzed under the ordinary MCL 445.774a reasonableness test, and *Borgiel* itself upheld a physician covenant [^borgiel-physician-upheld]. The distinctive problem is evidentiary, not categorical.
|
|
116
|
+
|
|
117
|
+
In *Isidore Steiner, DPM, PC v. Bonanni*, the Court of Appeals held that Michigan's physician-patient privilege is more protective than HIPAA and blocks discovery of nonparty patient information, which can make it harder for a medical employer to prove diversion of patients [^steiner-patient-privilege].
|
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118
|
+
|
|
119
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+
"Because Michigan law is more protective of patients' privacy interests in the context of this litigation, Michigan law applies to plaintiff's attempted discovery of defendant's patient information."[^steiner-patient-privilege]
|
|
120
|
+
|
|
121
|
+
> [!NOTE]
|
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122
|
+
> **Practice note.**
|
|
123
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+
>
|
|
124
|
+
> A physician non-solicitation or non-compete can be valid yet hard to enforce in practice. *Steiner* shows that patient-privilege limits on discovery can deprive a medical employer of the nonparty-patient evidence it needs to prove a breach, so build the enforcement case on non-privileged proof [^steiner-patient-privilege].
|
|
125
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+
|
|
126
|
+
## How does Michigan's trade-secret act interact with non-competes? {#trade-secret-overlay}
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|
127
|
+
|
|
128
|
+
**Short answer.** The Michigan Uniform Trade Secrets Act runs alongside a non-compete: it displaces conflicting common-law tort remedies for misappropriation but preserves contract remedies, so a confidentiality and trade-secret strategy can backstop or substitute for a covenant [^mutsa-displacement].
|
|
129
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+
|
|
130
|
+
MUTSA has its own timing and fee rules that a non-compete does not. A misappropriation claim must be brought within three years of discovery [^mutsa-limitations], and a court may award attorney fees for bad-faith claims or willful and malicious misappropriation — relief the non-compete statute itself does not provide [^mutsa-fees].
|
|
131
|
+
|
|
132
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+
"Except as provided in subsection (2), this act displaces conflicting tort, restitutionary, and other law of this state providing civil remedies for misappropriation of a trade secret."[^mutsa-displacement]
|
|
133
|
+
|
|
134
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+
## Will Michigan enforce a non-compete's choice-of-law or forum-selection clause? {#choice-of-law-forum}
|
|
135
|
+
|
|
136
|
+
**Short answer.** Often yes. In the *Stryker Corp. v. Ridgeway* litigation (the *Stone Surgical* dispute), the Sixth Circuit held that a non-compete's Michigan forum-selection clause was valid and enforceable under Michigan law [^stryker-michigan-clauses].
|
|
137
|
+
|
|
138
|
+
But the clause type matters. In *Barshaw v. Allegheny Performance Plastics, LLC*, the Court of Appeals held that a Michigan court applies Michigan law to decide the effect of a forum-selection clause, even when the contract chooses another state's law for the merits [^barshaw-michigan-forum-law].
|
|
139
|
+
|
|
140
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+
"Under Michigan law, the Michigan forum-selection clause is valid and enforceable."[^stryker-michigan-clauses]
|
|
141
|
+
|
|
142
|
+
## Does a Michigan non-compete toll or extend during breach or litigation? {#tolling-extension}
|
|
143
|
+
|
|
144
|
+
**Short answer.** This is an open Michigan question. No Michigan statute or appellate decision surfaced here squarely endorses automatic judicial tolling, or enforcement of an extension-on-breach clause after the stated restricted period expires [^mcl-774a-tolling-backdrop][^coates-tolling-backdrop].
|
|
145
|
+
|
|
146
|
+
The relevant backdrop cuts against assuming an automatic extension. MCL 445.774a authorizes a court to *limit* an unreasonable covenant, not to expand one [^mcl-774a-tolling-backdrop], and any extension still has to satisfy the reasonableness test that *Coates* applies as a question of law [^coates-tolling-backdrop]. A clause that converts a fixed restraint into an open-ended one as litigation drags on raises exactly the reasonableness concern the statute targets.
|
|
147
|
+
|
|
148
|
+
> [!NOTE]
|
|
149
|
+
> **Practice note.**
|
|
150
|
+
>
|
|
151
|
+
> Open question: Michigan law is unsettled on whether an extension-on-breach clause is enforceable after the original restricted period expires. Draft any tolling clause as a separate, reasonable restraint tied to the duration of the breach and a legitimate interest, and do not assume a Michigan court will extend an expired covenant automatically [^mcl-774a-tolling-backdrop][^coates-tolling-backdrop].
|
|
152
|
+
|
|
153
|
+
## What Michigan non-compete reform should employers watch? {#pending-reform}
|
|
154
|
+
|
|
155
|
+
**Short answer.** None is currently law. The bill to watch is House Bill 4040 (2025), which would amend MCL 445.774a to bar nearly all worker non-competes; as of June 3, 2026 it remains in committee and has not been enacted [^hb-4040-worker-ban][^hb-4040-status].
|
|
156
|
+
|
|
157
|
+
HB 4040 would prohibit a business from entering into, obtaining, or enforcing a non-compete against a worker, reaching beyond employees to independent contractors, interns, and volunteers [^hb-4040-worker-ban]. The official bill record shows it was referred to the House Committee on Economic Competitiveness and has had no further action [^hb-4040-status], so the enacted baseline remains statutory reasonableness under MCL 445.774a, as interpreted by Michigan non-compete cases.
|
|
158
|
+
|
|
159
|
+
A separate 2025 development affects onboarding paperwork that bundles covenants. In *Rayford v. American House Roseville I, LLC*, the Michigan Supreme Court held that a contractually shortened limitations provision in an adhesion agreement must be examined for reasonableness [^rayford-adhesion-reasonableness].
|
|
160
|
+
|
|
161
|
+
"Except as otherwise provided in subsection (2), a business shall not do any of the following: (a) Enter into or attempt to enter into a noncompete agreement with a worker. (b) Obtain or attempt to obtain a noncompete agreement from a worker. (c) Enforce or attempt to enforce a noncompete agreement against a worker or former worker."[^hb-4040-worker-ban]
|
|
162
|
+
|
|
163
|
+
> [!NOTE]
|
|
164
|
+
> **Practice note.**
|
|
165
|
+
>
|
|
166
|
+
> Treat HB 4040 as a monitoring item, not as present Michigan law. Recheck the official Michigan Legislature bill status before changing forms or telling workers that Michigan has enacted a general non-compete ban [^hb-4040-worker-ban].
|
|
167
|
+
|
|
168
|
+
[^about]: By Steven Obiajulu, J.D. Published by [openagreements.org](https://openagreements.org) · Maintained by [UseJunior](https://usejunior.com). Last reviewed 2026-06-03. License: CC BY 4.0. Steven Obiajulu, J.D. is admitted in New York, not Michigan. This article synthesizes Michigan primary law and is not legal advice from a Michigan-admitted attorney. This article is for informational purposes only and does not create an attorney-client relationship.
|
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169
|
+
|
|
170
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+
[^mcl-774a-employer-may-obtain]: **MCL § 445.774a** — "An employer may obtain from an employee an agreement or covenant which protects an employer's reasonable competitive business interests and expressly prohibits an employee from engaging in employment or a line of business after termination of employment if the agreement or covenant is reasonable as to its duration, geographical area, and the type of employment or line of business." *MCL § 445.774a(1).* <https://legislature.mi.gov/Laws/MCL?objectName=mcl-445-774a>
|
|
171
|
+
|
|
172
|
+
[^borgiel-unfair-advantage]: **St. Clair Medical, P.C. v. Borgiel** — "To be reasonable in relation to an employer's competitive business interest, a restrictive covenant must protect against the employee's gaining some unfair advantage in competition with the employer, but not prohibit the employee from using general knowledge or skill." *St. Clair Med., P.C. v. Borgiel, 270 Mich. App. 260 (2006).* <https://www.courtlistener.com/opinion/2026165/st-clair-medical-pc-v-borgiel/#:~:text=To%20be%20reasonable%20in%20relation,using%20general%20knowledge%20or%20skill.>
|
|
173
|
+
|
|
174
|
+
[^follmer-confidential-info]: **Follmer, Rudzewicz & Co., P.C. v. Kosco** — "To the extent such an agreement provides reasonable protection for the confidential information of the employer, it does not violate the statute and is enforceable." *Follmer, Rudzewicz & Co., P.C. v. Kosco, 420 Mich. 394 (1984).* <https://www.courtlistener.com/opinion/1708749/follmer-rudzewicz-co-v-kosco/#:~:text=To%20the%20extent%20such%20an,the%20statute%20and%20is%20enforceable.>
|
|
175
|
+
|
|
176
|
+
[^borgiel-general-skill]: **St. Clair Medical, P.C. v. Borgiel** — "To be reasonable in relation to an employer's competitive business interest, a restrictive covenant must protect against the employee's gaining some unfair advantage in competition with the employer, but not prohibit the employee from using general knowledge or skill." *St. Clair Med., P.C. v. Borgiel, 270 Mich. App. 260 (2006).* <https://www.courtlistener.com/opinion/2026165/st-clair-medical-pc-v-borgiel/#:~:text=To%20be%20reasonable%20in%20relation,using%20general%20knowledge%20or%20skill.>
|
|
177
|
+
|
|
178
|
+
[^mutsa-trade-secret-definition]: **MCL § 445.1902** — "‘Trade secret’ means information, including a formula, pattern, compilation, program, device, method, technique, or process, that is both of the following: (i) Derives independent economic value, actual or potential, from not being generally known to, and not being readily ascertainable by proper means by, other persons who can obtain economic value from its disclosure or use." *MCL § 445.1902(d).* <https://legislature.mi.gov/Laws/MCL?objectName=mcl-445-1902>
|
|
179
|
+
|
|
180
|
+
[^mcl-774a-reasonable-scope]: **MCL § 445.774a** — "An employer may obtain from an employee an agreement or covenant which protects an employer's reasonable competitive business interests and expressly prohibits an employee from engaging in employment or a line of business after termination of employment if the agreement or covenant is reasonable as to its duration, geographical area, and the type of employment or line of business." *MCL § 445.774a(1).* <https://legislature.mi.gov/Laws/MCL?objectName=mcl-445-774a>
|
|
181
|
+
|
|
182
|
+
[^coates-question-of-law]: **Coates v. Bastian Brothers, Inc.** — "The reasonableness of a noncompetition provision is a question of law when the relevant facts are undisputed." *Coates v. Bastian Bros., Inc., 276 Mich. App. 498 (2007).* <https://www.courtlistener.com/opinion/2220514/coates-v-bastian-brothers-inc/#:~:text=The%20reasonableness%20of%20a%20noncompetition,the%20relevant%20facts%20are%20undisputed.>
|
|
183
|
+
|
|
184
|
+
[^mid-michigan-unlimited]: **Mid Michigan Medical Billing Service, Inc. v. Williams** — "Although plaintiff argues that the expansive restriction is necessary to protect its business interests, plaintiff does not have an unlimited right to restrict the business choices of its clients." *Mid Mich. Med. Billing Serv., Inc. v. Williams, No. 323890 (Mich. Ct. App. Feb. 18, 2016).* <https://www.courts.michigan.gov/siteassets/case-documents/uploads/opinions/final/coa/20160218_c323890_37_323890.opn.pdf>
|
|
185
|
+
|
|
186
|
+
[^qis-continued-employment]: **QIS, Inc. v. Industrial Quality Control, Inc.** — "Mere continuation of employment is sufficient consideration to support a noncompete agreement in an at-will employment setting." *QIS, Inc. v. Indus. Quality Control, Inc., 262 Mich. App. 592 (2004).* <https://www.courtlistener.com/opinion/1591214/qis-inc-v-industrial-quality-control-inc/#:~:text=Mere%20continuation%20of%20employment%20is,in%20an%20at%2Dwill%20employment%20setting.>
|
|
187
|
+
|
|
188
|
+
[^qis-just-cause]: **QIS, Inc. v. Industrial Quality Control, Inc.** — "Because defendants were ‘just cause’ employees, however, the issue is whether defendants' refusal to sign the noncompete agreement would amount to ‘just cause’ for their termination." *QIS, Inc. v. Indus. Quality Control, Inc., 262 Mich. App. 592 (2004).* <https://www.courtlistener.com/opinion/1591214/qis-inc-v-industrial-quality-control-inc/#:~:text=Because%20defendants%20were%20%E2%80%9Cjust%20cause%E2%80%9D,%E2%80%9Cjust%20cause%E2%80%9D%20for%20their%20termination.>
|
|
189
|
+
|
|
190
|
+
[^mcl-774a-court-may-limit]: **MCL § 445.774a** — "To the extent any such agreement or covenant is found to be unreasonable in any respect, a court may limit the agreement to render it reasonable in light of the circumstances in which it was made and specifically enforce the agreement as limited." *MCL § 445.774a(1).* <https://legislature.mi.gov/Laws/MCL?objectName=mcl-445-774a>
|
|
191
|
+
|
|
192
|
+
[^mid-michigan-limited]: **Mid Michigan Medical Billing Service, Inc. v. Williams** — "If the terms of a noncompetition agreement are unreasonable, MCL 445.774a allows a court to modify the terms of the agreement to render it reasonable and enforceable in light of the circumstances in which it was made." *Mid Mich. Med. Billing Serv., Inc. v. Williams, No. 323890 (Mich. Ct. App. Feb. 18, 2016).* <https://www.courts.michigan.gov/siteassets/case-documents/uploads/opinions/final/coa/20160218_c323890_37_323890.opn.pdf>
|
|
193
|
+
|
|
194
|
+
[^innovation-rule-of-reason]: **Innovation Ventures, LLC v. Liquid Manufacturing, LLC** — "Commercial noncompete agreements between businesses should be evaluated under the rule of reason, and federal court interpretations of the rule of reason should be given due deference." *Innovation Ventures, LLC v. Liquid Mfg., LLC, 499 Mich. 491 (2016).* <https://www.courtlistener.com/opinion/4239128/innovation-ventures-v-liquid-manufacturing/#:~:text=Commercial%20noncompete%20agreements%20between%20businesses,should%20be%20given%20due%20deference.>
|
|
195
|
+
|
|
196
|
+
[^mcl-772-restraint]: **MCL § 445.772** — "A contract, combination, or conspiracy between 2 or more persons in restraint of, or to monopolize, trade or commerce in a relevant market is unlawful." *MCL § 445.772.* <https://legislature.mi.gov/Laws/MCL?objectName=mcl-445-772>
|
|
197
|
+
|
|
198
|
+
[^mcl-784-federal-deference]: **MCL § 445.784** — "It is the intent of the legislature that in construing all sections of this act, the courts shall give due deference to interpretations given by the federal courts to comparable antitrust statutes, including, without limitation, the doctrine of per se violations and the rule of reason." *MCL § 445.784(2).* <https://legislature.mi.gov/Laws/MCL?objectName=mcl-445-784>
|
|
199
|
+
|
|
200
|
+
[^borgiel-physician-upheld]: **St. Clair Medical, P.C. v. Borgiel** — "We conclude that the covenant protected plaintiff from unfair competition by defendant and therefore protected a reasonable competitive business interest as required by MCL 445.774a(1)." *St. Clair Med., P.C. v. Borgiel, 270 Mich. App. 260 (2006).* <https://www.courtlistener.com/opinion/2026165/st-clair-medical-pc-v-borgiel/#:~:text=We%20conclude%20that%20the%20covenant,as%20required%20by%20MCL%20445.774a(1).>
|
|
201
|
+
|
|
202
|
+
[^steiner-patient-privilege]: **Isidore Steiner, DPM, PC v. Bonanni** — "Because Michigan law is more protective of patients' privacy interests in the context of this litigation, Michigan law applies to plaintiff's attempted discovery of defendant's patient information." *Isidore Steiner, DPM, PC v. Bonanni, 292 Mich. App. 265 (2011).* <https://www.courtlistener.com/opinion/8006439/isidore-steiner-dpm-pc-v-bonanni/#:~:text=Because%20Michigan%20law%20is%20more,discovery%20of%20defendant's%20patient%20information.>
|
|
203
|
+
|
|
204
|
+
[^mutsa-displacement]: **MCL § 445.1908** — "Except as provided in subsection (2), this act displaces conflicting tort, restitutionary, and other law of this state providing civil remedies for misappropriation of a trade secret." *MCL § 445.1908(1).* <https://legislature.mi.gov/Laws/MCL?objectName=mcl-445-1908>
|
|
205
|
+
|
|
206
|
+
[^mutsa-limitations]: **MCL § 445.1907** — "An action for misappropriation must be brought within 3 years after the misappropriation is discovered or by the exercise of reasonable diligence should have been discovered." *MCL § 445.1907.* <https://legislature.mi.gov/Laws/MCL?objectName=mcl-445-1907>
|
|
207
|
+
|
|
208
|
+
[^mutsa-fees]: **MCL § 445.1905** — "If a claim of misappropriation is made in bad faith, a motion to terminate an injunction is made or resisted in bad faith, or willful and malicious misappropriation exists, the court may award reasonable attorney's fees to the prevailing party." *MCL § 445.1905.* <https://legislature.mi.gov/Laws/MCL?objectName=mcl-445-1905>
|
|
209
|
+
|
|
210
|
+
[^stryker-michigan-clauses]: **Stryker Corp. v. Ridgeway (Stone Surgical, LLC v. Stryker Corp.)** — "Under Michigan law, the Michigan forum-selection clause is valid and enforceable." *Stryker Corp. v. Ridgeway, 858 F.3d 383 (6th Cir. 2017).* <https://www.courtlistener.com/opinion/4394140/stryker-corporation-v-christopher-ridgeway/#:~:text=Under%20Michigan%20law%2C%20the%20Michigan,clause%20is%20valid%20and%20enforceable.>
|
|
211
|
+
|
|
212
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[^barshaw-michigan-forum-law]: **Barshaw v. Allegheny Performance Plastics, LLC** — "Hence, in the absence of certain factors not germane to this appeal, a forum-selection clause may be considered separately from any choice-of-law provision that may also be in the contract, and in such cases, the Michigan court in which the action has been filed, shall apply Michigan law in determining the effect of the forum-selection clause." *Barshaw v. Allegheny Performance Plastics, LLC, 334 Mich. App. 741 (2020).* <https://www.courtlistener.com/opinion/4833431/steven-barshaw-v-allegheny-performance-plastics-llc/#:~:text=Hence%2C%20in%20the%20absence%20of,effect%20of%20the%20forum%2Dselection%20clause.>
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[^mcl-774a-tolling-backdrop]: **MCL § 445.774a** — "To the extent any such agreement or covenant is found to be unreasonable in any respect, a court may limit the agreement to render it reasonable in light of the circumstances in which it was made and specifically enforce the agreement as limited." *MCL § 445.774a(1).* <https://legislature.mi.gov/Laws/MCL?objectName=mcl-445-774a>
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[^coates-tolling-backdrop]: **Coates v. Bastian Brothers, Inc.** — "The reasonableness of a noncompetition provision is a question of law when the relevant facts are undisputed." *Coates v. Bastian Bros., Inc., 276 Mich. App. 498 (2007).* <https://www.courtlistener.com/opinion/2220514/coates-v-bastian-brothers-inc/#:~:text=The%20reasonableness%20of%20a%20noncompetition,the%20relevant%20facts%20are%20undisputed.>
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[^hb-4040-worker-ban]: **Michigan House Bill 4040 (2025)** — "Except as otherwise provided in subsection (2), a business shall not do any of the following: (a) Enter into or attempt to enter into a noncompete agreement with a worker. (b) Obtain or attempt to obtain a noncompete agreement from a worker. (c) Enforce or attempt to enforce a noncompete agreement against a worker or former worker." *2025 Mich. H.B. 4040 (introduced Jan. 30, 2025).* <https://www.legislature.mi.gov/documents/2025-2026/billintroduced/House/htm/2025-HIB-4040.htm>
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[^hb-4040-status]: **Michigan House Bill 4040 (2025) — bill status** — "referred to Committee on Economic Competitiveness" *2025 Mich. H.B. 4040, Bill Status (Mich. Legislature).* <https://www.legislature.mi.gov/Bills/Bill?ObjectName=2025-HB-4040>
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[^rayford-adhesion-reasonableness]: **Rayford v. American House Roseville I, LLC** — "A shortened limitations provision contained in such an agreement must be examined for reasonableness." *Rayford v. American House Roseville I, LLC, ___ Mich. ___ (2025) (Docket No. 163989).* <https://www.courtlistener.com/opinion/10645648/timika-rayford-v-american-house-roseville-i-llc/#:~:text=A%20shortened%20limitations%20provision%20contained,must%20be%20examined%20for%20reasonableness.>
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jurisdiction: "Minnesota"
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---
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> **Canonical:** https://openagreements.org/legal/non-compete/minnesota · **Snapshot as of:** 2026-06-08 · License: CC BY 4.0 · © UseJunior
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# Employment Non-Competes in Minnesota[^about]
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A question-by-question summary of Minnesota's 2023 non-compete statute, legacy Minnesota common law, statutory exceptions, nonsolicitation treatment, and choice-of-law limits.
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## At a glance
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| Question | Minnesota |
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| --- | --- |
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| **Are non-competes enforceable?** | Banned |
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| **Bottom line** | Most employee and independent-contractor non-competes signed on or after July 1, 2023 are void and unenforceable, with only sale-of-business and business-dissolution exceptions surviving. |
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| **Main law or case** | Minn. Stat. § 181.988 |
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| **Main exceptions** | Sale of business; dissolution of business; pre-July 1, 2023 agreements under common law; NDAs/nonsolicits excluded |
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| **When the ban took effect** | July 1, 2023 (prospective only) |
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| **Can a court narrow it?** | No |
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| **Applies to contractors?** | Yes |
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## Are employee non-compete agreements enforceable in Minnesota? {#employee-noncompetes}
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**Short answer.** Usually no, for agreements entered into on or after July 1, 2023. Minn. Stat. § 181.988 makes covered covenants not to compete void and unenforceable[^minn-181-988-voids-employment-noncompetes], unless a sale-of-business or dissolution exception applies.
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The statute covers employees and independent contractors. It defines an employee as any individual who performs services for an employer, "including independent contractors"[^minn-181-988-includes-independent-contractors], and commentary treats that scope as broader than wage-threshold statutes in many other states [^cooley-minn-181-988-independent-contractors][^littler-minn-181-988-complete-prohibition].
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For a standard post-employment employee non-compete signed on or after July 1, 2023, the practical answer is to remove it rather than revise the duration, territory, or employee class. Those older drafting variables matter mainly for pre-July 1, 2023 agreements and for the statute's narrow business-sale and dissolution exceptions.
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## What law governs Minnesota non-compete agreements signed before July 1, 2023? {#pre-2023-agreements}
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**Short answer.** Pre-July 1, 2023 agreements are still analyzed under Minnesota common law, not automatically voided by the 2023 statute.
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Minnesota-specific commentary reads the statute as prospective: agreements entered before July 1, 2023 continue to be evaluated under the established case-law framework [^cooley-minn-181-988-not-retroactive]. Under that framework, Minnesota courts disfavor employment non-competes, but may enforce them when they protect a legitimate employer interest and are no broader than necessary to protect that interest[^kallok-medtronic-legitimate-interest].
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The older common-law analysis is fact-specific. Bennett says the court balances the employer's business protection against the employee's right to work and earn a livelihood [^bennett-storz-fact-specific-balance]. Sanborn adds a separate consideration trap: if the non-compete was not part of the original employment contract, independent consideration is required, and mere continued employment is not enough [^sanborn-currie-independent-consideration].
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> [!NOTE]
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> **Practice note.**
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> Do not treat a pre-July 1, 2023 Minnesota non-compete as automatically enforceable just because the new statute is prospective. The older cases still require a legitimate business interest, reasonable scope, employee hardship balancing, and adequate consideration [^kallok-medtronic-legitimate-interest][^sanborn-currie-independent-consideration].
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## What are the statutory exceptions to Minnesota's non-compete ban? {#statutory-exceptions}
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**Short answer.** Two statutory exceptions remain: a covenant agreed upon during the sale of a business, and a covenant agreed upon in anticipation of the dissolution of a business.
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The sale-of-business exception allows the seller, partners, members, shareholders, and buyer to agree on a temporary and geographically restricted covenant if it is tied to a reasonable area and reasonable length of time "during the sale of a business"[^minn-181-988-sale-business-exception]. The dissolution exception similarly allows partners, members, or shareholders to agree not to carry on a similar business in a reasonable geographic area where the business has operated [^minn-181-988-dissolution-exception].
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Those exceptions keep transaction-related restraints available, but they do not convert every seller, founder, member, or shareholder covenant into an enforceable agreement. Commentary flags that the statute does not define what counts as a reasonable geographic territory or duration for the exceptions [^taft-minn-181-988-exception-reasonableness].
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> **Drafting note.**
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> Draft sale-of-business and dissolution covenants as transaction restraints, not ordinary employee non-competes repackaged in a purchase agreement or operating-company document. The statutory exception still uses reasonableness limits for geography and time [^minn-181-988-sale-business-exception][^taft-minn-181-988-exception-reasonableness].
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## How does Minnesota's non-compete statute treat non-solicitation agreements, customer non-solicits, and NDAs? {#nonsolicits-ndas}
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**Short answer.** Minn. Stat. § 181.988 does not define NDAs, trade-secret agreements, customer non-solicits, client-list restrictions, or customer-solicitation restrictions as covenants not to compete.
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The statute expressly says a covenant not to compete does not include[^minn-181-988-excludes-ndas-nonsolicits] nondisclosure agreements, agreements designed to protect trade secrets or confidential information, nonsolicitation agreements, client-list restrictions, or customer-solicitation restrictions. Commentary reaches the same basic reading: Minnesota's ban leaves confidentiality and nonsolicitation tools available [^mcdermott-minn-181-988-nonsolicits-valid][^stinson-minn-181-988-nonsolicits-careful-drafting].
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That does not mean labels control. A clause called a customer non-solicit can still create non-compete risk if it functionally blocks the worker from performing work for another employer. Employer commentary makes that practical point for templates: preserve legitimate nonsolicit and confidentiality protections, but draft them to protect relationships and information rather than to bar employment [^snell-minn-181-988-functional-noncompete].
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> For Minnesota agreements after July 1, 2023, separate permitted confidentiality, trade-secret, customer-list, and nonsolicitation language from any ban on working for a competitor. A nonsolicit that functions like a work ban may be treated as non-compete risk even if the label is different [^snell-minn-181-988-functional-noncompete].
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## Can choice-of-law or forum-selection clauses avoid Minnesota's non-compete statute? {#choice-of-law-venue}
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**Short answer.** Usually no for employees who primarily reside and work in Minnesota, for claims arising under Minn. Stat. § 181.988.
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The statute prohibits requiring a Minnesota-resident-and-worker employee, as a condition of employment, to agree to out-of-state adjudication or to a clause that would deprive the employee of Minnesota substantive protection[^minn-181-988-substantive-minnesota-law] for a controversy arising in Minnesota. If the clause violates that rule, it is voidable at the employee's request, and the dispute is adjudicated in Minnesota under Minnesota law [^minn-181-988-voidable-minnesota-forum].
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This is broader than just deleting a non-compete paragraph. Commentary warns that employers with Minnesota employees should review choice-of-law and venue language even in agreement forms that do not currently use non-competes [^stinson-minn-181-988-choice-law-risk][^littler-minn-181-988-foreign-law-templates].
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> Do not rely on Delaware, New York, Texas, or another state's law to preserve a Minnesota employee non-compete. For workers who primarily reside and work in Minnesota, use Minnesota forum and Minnesota law for section 181.988 disputes, or expect the employee to challenge the clause [^minn-181-988-substantive-minnesota-law][^stinson-minn-181-988-choice-law-risk].
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## Did Minnesota add a separate rule for service-provider no-hire restrictions? {#service-contract-restrictions}
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**Short answer.** Yes. Effective July 1, 2024, Minnesota added a separate statute voiding certain service-contract provisions that block a customer from soliciting or hiring a service provider's worker.
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Minn. Stat. § 181.9881 is separate from the 2023 employee non-compete statute, but it matters for staffing, consulting, and vendor agreements. It says a service provider may not restrict a customer from soliciting or hiring the service provider's employee, and an existing violating provision is void and unenforceable[^minn-181-9881-service-contract-void].
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The statute includes independent contractors in its employee definition and requires notice to affected employees when an existing contract violates the rule [^minn-181-9881-employee-notice]. It also has a software-consulting exemption for workers seeking later permanent employment with the customer [^minn-181-9881-software-consulting-exemption].
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## What recent developments changed Minnesota non-compete law? {#recent-developments}
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**Short answer.** Minnesota changed from a common-law enforceability regime to a prospective statutory ban in 2023, then added a service-contract restriction in 2024.
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**May 24, 2023:** Governor Tim Walz signed SF 3035, adding Minn. Stat. § 181.988 and prohibiting most new employee and independent-contractor non-competes [^stinson-minn-181-988-signed-effective].
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**July 1, 2023:** The ban took effect for new agreements. Commentary treats pre-July 1, 2023 agreements as still governed by the preexisting common-law framework [^cooley-minn-181-988-not-retroactive-development][^littler-minn-181-988-existing-agreements].
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**July 1, 2024:** The separate service-contract statute, Minn. Stat. § 181.9881, took effect for customer no-hire restrictions in service-provider contracts [^minn-181-9881-service-contract-void-development].
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**2025 legislative context:** A 2025 bill proposed additional exceptions to section 181.988 for certain high-compensation employees [^minn-hf1768-proposed-exceptions]; it has not been enacted as of this article's publication.
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[^about]: By Steven Obiajulu, J.D. Published by [openagreements.org](https://openagreements.org) · Maintained by [UseJunior](https://usejunior.com). Last reviewed 2026-05-27. License: CC BY 4.0. Steven Obiajulu, J.D. is admitted in New York, not Minnesota. This article synthesizes Minnesota primary law and is not legal advice from a Minnesota-admitted attorney. This article is for informational purposes only and does not create an attorney-client relationship.
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[^minn-181-988-voids-employment-noncompetes]: **Minn. Stat. § 181.988, subd. 2(a)** — "Any covenant not to compete contained in a contract or agreement is void and unenforceable." *Minn. Stat. § 181.988, subd. 2(a) (2025).* <https://www.revisor.mn.gov/statutes/cite/181.988>
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[^minn-181-988-includes-independent-contractors]: **Minn. Stat. § 181.988, subd. 1(c)** — "‘Employee’ as used in this section means any individual who performs services for an employer, including independent contractors." *Minn. Stat. § 181.988, subd. 1(c) (2025).* <https://www.revisor.mn.gov/statutes/cite/181.988>
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[^cooley-minn-181-988-independent-contractors]: **Cooley commentary** — "SF 3035 is broadly written and bans all noncompetes between an employer and an employee or independent contractor" *Cooley, Minnesota Set to Ban Most Noncompete Agreements Beginning July 1, 2023 (2023).* <https://www.cooley.com/news/insight/2023/2023-06-28-minnesota-set-to-ban-most-noncompete-agreements-beginning-july-1-2023>
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[^littler-minn-181-988-complete-prohibition]: **Littler Mendelson commentary** — "the proposed Minnesota law creates a complete prohibition on non-compete agreements between the employer and workers, regardless of the person’s income" *Littler Mendelson, Minnesota Is Poised to Enact a Law Banning Virtually All Non-Compete Agreements (2023).* <https://www.littler.com/news-analysis/asap/minnesota-poised-enact-law-banning-virtually-all-non-compete-agreements>
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[^cooley-minn-181-988-not-retroactive]: **Cooley commentary** — "Minnesota’s noncompete statute is not retroactive – any noncompete agreements entered into prior to the July 1, 2023, effective date will continue to be evaluated pursuant to Minnesota common law" *Cooley, Minnesota Set to Ban Most Noncompete Agreements Beginning July 1, 2023 (2023).* <https://www.cooley.com/news/insight/2023/2023-06-28-minnesota-set-to-ban-most-noncompete-agreements-beginning-july-1-2023>
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[^kallok-medtronic-legitimate-interest]: **Kallok v. Medtronic, Inc.** — "noncompete agreements are enforceable if they serve a legitimate employer interest and are not broader than necessary to protect this interest." *Kallok v. Medtronic, Inc., 573 N.W.2d 356 (Minn. 1998).* <https://www.courtlistener.com/opinion/1251773/kallok-v-medtronic-inc/#:~:text=noncompete%20agreements%20are%20enforceable%20if,necessary%20to%20protect%20this%20interest.>
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[^bennett-storz-fact-specific-balance]: **Bennett v. Storz Broadcasting Co.** — "the court must consider not only the nature of the business and character of the employment but all the circumstances of the case" *Bennett v. Storz Broadcasting Co., 270 Minn. 525, 134 N.W.2d 892 (1965).* <https://www.courtlistener.com/opinion/1689754/bennett-v-storz-broadcasting-co/#:~:text=the%20court%20must%20consider%20not,the%20circumstances%20of%20the%20case>
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[^sanborn-currie-independent-consideration]: **Sanborn Manufacturing Co. v. Currie** — "Proof of continued employment is not enough to show sufficient consideration for a noncompetition agreement." *Sanborn Mfg. Co. v. Currie, 500 N.W.2d 161 (Minn. Ct. App. 1993).* <https://www.courtlistener.com/opinion/1625841/sanborn-manufacturing-co-v-currie/#:~:text=Proof%20of%20continued%20employment%20is,consideration%20for%20a%20noncompetition%20agreement.>
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[^minn-181-988-sale-business-exception]: **Minn. Stat. § 181.988, subd. 2(b)(1)** — "the covenant not to compete is agreed upon during the sale of a business. The person selling the business and the partners, members, or shareholders, and the buyer of the business may agree on a temporary and geographically restricted covenant not to compete that will prohibit the seller of the business from carrying on a similar business within a reasonable geographic area and for a reasonable length of time" *Minn. Stat. § 181.988, subd. 2(b)(1) (2025).* <https://www.revisor.mn.gov/statutes/cite/181.988>
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[^minn-181-988-dissolution-exception]: **Minn. Stat. § 181.988, subd. 2(b)(2)** — "the covenant not to compete is agreed upon in anticipation of the dissolution of a business." *Minn. Stat. § 181.988, subd. 2(b)(2) (2025).* <https://www.revisor.mn.gov/statutes/cite/181.988>
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[^taft-minn-181-988-exception-reasonableness]: **Taft commentary** — "the law does not provide guidance as to what constitutes a ‘reasonable’ geographic territory or length of time for a non-competition provision to be permissible." *Taft, Minnesota Becomes Yet Another State To Ban Non-Compete Agreements (2023).* <https://www.taftlaw.com/news-events/law-bulletins/minnesota-becomes-yet-another-state-to-ban-non-compete-agreements/>
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[^minn-181-988-excludes-ndas-nonsolicits]: **Minn. Stat. § 181.988, subd. 1(a)** — "A covenant not to compete does not include a nondisclosure agreement, or agreement designed to protect trade secrets or confidential information. A covenant not to compete does not include a nonsolicitation agreement, or agreement restricting the ability to use client or contact lists, or solicit customers of the employer." *Minn. Stat. § 181.988, subd. 1(a) (2025).* <https://www.revisor.mn.gov/statutes/cite/181.988>
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[^mcdermott-minn-181-988-nonsolicits-valid]: **McDermott Will & Emery commentary** — "Nondisclosure agreements, or other agreements designed to protect trade secrets or confidential business information" *McDermott Will & Emery, Minnesota Bans Noncompete Agreements with Limited Exceptions (2023).* <https://www.mcdermottlaw.com/insights/minnesota-bans-noncompete-agreements-with-limited-exceptions/>
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[^stinson-minn-181-988-nonsolicits-careful-drafting]: **Stinson commentary** — "Nondisclosure (which, as previously mentioned, still must comply with recent NLRB decisions) and nonsolicitation agreements, as well as agreements that restrict an employee’s use of customer or client lists, should be carefully crafted to protect employer’s business needs." *Stinson, Minnesota Non-Compete Ban Signed into Law and Effective July 1, 2023 (2023).* <https://www.stinson.com/newsroom-publications-minnesota-non-compete-ban-signed-into-law-and-effective-july-1-2023>
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[^snell-minn-181-988-functional-noncompete]: **Snell & Wilmer commentary** — "Customer non-solicitation and employee non-solicitation agreements are not impacted (but if the provision functions like a noncompete, it will be banned even if it is called a non-solicit)." *Snell & Wilmer, Doing Business in Minnesota? Six Things Employers Should Know About the New Noncompete Ban (2023).* <https://www.swlaw.com/publication/doing-business-in-minnesota-six-things-employers-should-know-about-the-new-noncompete-ban/>
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[^minn-181-988-substantive-minnesota-law]: **Minn. Stat. § 181.988, subd. 3(a)** — "deprive the employee of the substantive protection of Minnesota law with respect to a controversy arising in Minnesota." *Minn. Stat. § 181.988, subd. 3(a) (2025).* <https://www.revisor.mn.gov/statutes/cite/181.988>
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150
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151
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[^minn-181-988-voidable-minnesota-forum]: **Minn. Stat. § 181.988, subd. 3(b)** — "the matter shall be adjudicated in Minnesota and Minnesota law shall govern the dispute." *Minn. Stat. § 181.988, subd. 3(b) (2025).* <https://www.revisor.mn.gov/statutes/cite/181.988>
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152
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153
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[^stinson-minn-181-988-choice-law-risk]: **Stinson commentary** — "employers should consult with their legal counsel to gauge risk in maintaining choice of law and forum selection clauses for outside jurisdictions in agreements for employees who live or work in Minnesota." *Stinson, Minnesota Non-Compete Ban Signed into Law and Effective July 1, 2023 (2023).* <https://www.stinson.com/newsroom-publications-minnesota-non-compete-ban-signed-into-law-and-effective-july-1-2023>
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154
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155
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[^littler-minn-181-988-foreign-law-templates]: **Littler Mendelson commentary** — "Many employers in Minnesota that do not currently use non-compete agreements would still need to amend template agreements to comply with this part of the proposed law." *Littler Mendelson, Minnesota Is Poised to Enact a Law Banning Virtually All Non-Compete Agreements (2023).* <https://www.littler.com/news-analysis/asap/minnesota-poised-enact-law-banning-virtually-all-non-compete-agreements>
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156
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157
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[^minn-181-9881-service-contract-void]: **Minn. Stat. § 181.9881, subd. 2(a)–(b)** — "Any provision of an existing contract that violates paragraph (a) is void and unenforceable." *Minn. Stat. § 181.9881, subd. 2(a)–(b) (2025).* <https://www.revisor.mn.gov/statutes/cite/181.9881>
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158
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159
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[^minn-181-9881-employee-notice]: **Minn. Stat. § 181.9881, subd. 2(c)** — "the service provider must provide notice to their employees of this section and the restrictive covenant in the existing contract that violates this section." *Minn. Stat. § 181.9881, subd. 2(c) (2025).* <https://www.revisor.mn.gov/statutes/cite/181.9881>
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160
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161
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[^minn-181-9881-software-consulting-exemption]: **Minn. Stat. § 181.9881, subd. 3** — "This section does not apply to workers providing professional business consulting for computer software development and related services" *Minn. Stat. § 181.9881, subd. 3 (2025).* <https://www.revisor.mn.gov/statutes/cite/181.9881>
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162
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163
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[^stinson-minn-181-988-signed-effective]: **Stinson commentary** — "MN SF 3035, signed by Governor Walz on May 24, 2023, restricts employers from entering into noncompetition agreements on or after July 1, 2023" *Stinson, Minnesota Non-Compete Ban Signed into Law and Effective July 1, 2023 (2023).* <https://www.stinson.com/newsroom-publications-minnesota-non-compete-ban-signed-into-law-and-effective-july-1-2023>
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164
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165
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[^cooley-minn-181-988-not-retroactive-development]: **Cooley commentary** — "The prohibition on noncompete agreements goes into effect on July 1, 2023." *Cooley, Minnesota Set to Ban Most Noncompete Agreements Beginning July 1, 2023 (2023).* <https://www.cooley.com/news/insight/2023/2023-06-28-minnesota-set-to-ban-most-noncompete-agreements-beginning-july-1-2023>
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166
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167
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[^littler-minn-181-988-existing-agreements]: **Littler Mendelson commentary** — "non-compete agreements entered into prior to the effective date of the new law would continue to be evaluated by Minnesota courts based on the established body of case law" *Littler Mendelson, Minnesota Is Poised to Enact a Law Banning Virtually All Non-Compete Agreements (2023).* <https://www.littler.com/news-analysis/asap/minnesota-poised-enact-law-banning-virtually-all-non-compete-agreements>
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168
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169
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[^minn-181-9881-service-contract-void-development]: **Minn. Stat. § 181.9881, subd. 2(a)** — "No service provider may restrict, restrain, or prohibit in any way a customer from directly or indirectly soliciting or hiring an employee of a service provider." *Minn. Stat. § 181.9881, subd. 2(a) (2025).* <https://www.revisor.mn.gov/statutes/cite/181.9881>
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170
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171
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[^minn-hf1768-proposed-exceptions]: **H.F. 1768, 94th Leg., Reg. Sess. (Minn. 2025)** — "providing additional circumstances under which a covenant not to compete is valid and enforceable" *H.F. 1768, 94th Leg., Reg. Sess. (Minn. 2025).* <https://www.revisor.mn.gov/bills/94/2025/0/HF/1768/versions/latest/pdf/?list=open>
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