Friday, January 23, 2015

WORKERS CANNOT LEAVE A JOB WITH THEIR EMPLOYER’S SECRETS

Under New Hampshire law a worker is prohibited from disclosing or using her employer’s trade secrets even if she did not sign a confidentiality agreement. New Hampshire law prohibits the misuse of an employer’s confidential and proprietary information by statute. RSA 350-B, Uniform Trade Secret Act, makes it illegal to disclose or use a trade secret of another without consent.

Under that Act, a trade secret is defined as information including a formula, pattern, compilation, program, device, method, technique or process that is of particular value because of its confidential, proprietary nature and is subject to efforts that are reasonable under the circumstance to maintain its secrecy. A customer list, particularly to the extent it has detailed customer information that is not known to the employer’s competitors, may constitute a trade secret and therefore a worker who discloses or uses the contents of customer list may be in violation of the law.

If a former worker were to disclose or use such information in competition with her former employer, even absent a confidentiality agreement or non-compete agreement, the employer may still be able to get a court injunction prohibiting the former worker from such use. Furthermore, to the extent the employer was damaged, the law entitles the employer to receive a monetary award which could include both the actual loss to the employer and the unjust enrichment to the former employee caused by the misappropriation not taken in account in computing actual loss. Therefore to the extent the use of these trade secrets by the former worker benefited her more than the actual loss caused to her former employer, those monies may also be recouped by the former employer from her and those who were conspiring with her in using those trade secrets.

In cases where the employer is able to show willful or malicious misappropriation, the Court may award exemplary damages not to exceed twice the amount of the total damages and unjust enrichment. The Court may also award reasonable attorney’s fees to the winning party if it finds that: the claim of misappropriation was made in bad faith or a motion to terminate an injunction is made or resisted in bad faith; or willful and malicious misappropriation exists. Depending on the facts of the matter, it is also possible that federal laws and state criminal laws of theft apply.

In conclusion, a worker who is considering leaving her former employer should realize that even, if she did not sign a confidentiality agreement or non-compete agreement, she still has certain legal obligations to her former employer under the law. It would be prudent for her to discuss with legal counsel what those legal obligations are when she takes a new job with a competitor or sets up her own company to compete with her former employer.

J. Daniel Marr is a Director and Shareholder at Hamblett & Kerrigan, P.A. His legal practice includes counseling businesses and individuals on a variety of legal issues and advocating on their behalf. Attorney Marr is licensed and practices in both New Hampshire and Massachusetts. Attorney Marr can be reached at dmarr@nashualaw.com.

Wednesday, January 21, 2015

Tuesday, January 20, 2015

PARENTAL KIDNAPPING PREVENTION ACT

In 1980, Congress enacted the Parental Kidnapping Prevention Act (“PKPA”) to address the continuing problem of interstate custodial disputes. In adopting the PKPA, Congress attempted to impose more uniformity in case law and to eliminate some perceived gaps in the Uniform Child Custody Jurisdiction Act (UCCJA).

Contrary to the impression given by the title of the Act, kidnapping or other wrongdoing is not required for the PKPA to operate. The scope of the PKPA, as with the UCCJA and UCCJEA, encompasses all interstate custody determinations. While the PKPA has a substantial effect on interstate custody disputes, it does not establish a federal cause of action to resolve conflicting interstate decrees. Because a federal district court can neither prevent nor remedy a PKPA violation, the proper channel for such a violation is by appeal in the state court followed by a writ of certiorari to the United States Supreme Court. In addition to the appellate process, a civil rights action under 42 U.S.C. §1983 may be possible against the state court judge and the other parent for violating the PKPA.

The PKPA enumerates five jurisdictional bases as well as creates a system of preferred jurisdictional basis. The order of preferred jurisdictional basis is as follows: (i) continuing jurisdiction; (ii) home state jurisdiction; (iii) significant connection jurisdiction; (iv) jurisdiction where no other jurisdictional basis available; and (v) emergency jurisdiction. Under the preferential system, the court with the most preferred jurisdictional basis has the exclusive jurisdiction over the custody matter, absent a declination of jurisdiction by a court that has the preferred jurisdiction. However, emergency jurisdiction may be exercised independently of the order of preference, but said relief is typically temporary in nature and the parties are usually directed to return to the court with the most preferred jurisdictional basis.

While the PKPA does contain similar terminology as the UCCJA, there are several important distinctions between them. For example, continuing jurisdiction under the PKPA allows a state to retain jurisdiction to the exclusion of other states so long as the child or a party resides in that state. Additionally, jurisdiction predicated on significant contact with the forum only applies if there is no jurisdiction under “continuing jurisdiction” or “home state jurisdiction.” If jurisdiction exists under the first analysis, then jurisdiction cannot be predicted on significant contact with the forum.

Under the Supremacy Clause of the United States Constitution, federal regulations preempt conflicting state law. When the PKPA conflicts with the UCCJA, UCCJEA or other state law, the PKPA will preempt the state law and the jurisdictional issue will be resolved under the PKPA. Therefore, when the PKPA provides a preference for home state jurisdiction over any other basis, the PKPA will preempt, except on an emergency basis, any state statute that authorizes jurisdiction over the state which is the child’s home state.

If you have any questions regarding interstate custodial disputes, please do not hesitate to contact an attorney at Hamblett & Kerrigan to discuss. The attorneys at Hamblett & Kerrigan have experience in handling such situations. Let Hamblett & Kerrigan use their experience to your advantage.

Kevin P. Rauseo is a director at Hamblett & Kerrigan P.A. He concentrates his practice in the areas of family and divorce law, Collaborative law, child custody and visitation, child support and alimony, personal injury, insurance defense, slip and fall accidents, automobile and truck accidents, motorcycle accidents, premises liability, dog bites and civil litigation. He is a member of the International Academy of Collaborative Professional and serves on the Professional Development Committee and has previously served on the Public Education Advisory Panel of the Academy. He also is a member of the Collaborative Law Alliance of New Hampshire. AV Preeminent Rated by Martindale-Hubbell. Recipient of the 2014 Nationally Ranked Top 10 Attorney Award from the National Academy of Family Law Attorneys (NAFLA). You can reach Attorney Rauseo at krauseo@nashualaw.com.

Friday, January 16, 2015

Getting Paid Sales Commissions Owed by Former Employer

Under New Hampshire Law, sales commissions are a part of wages by statute and an employee has the right to bring a wage complaint before the New Hampshire Department of Labor in Concord or a complaint in the Superior Court to collect those commissions. Generally, for many cases, the New Hampshire Department of Labor is the best place for an employee to go for such a claim, not only because it is quicker, but the hearing officers work with these types of cases on a day-to-day basis. Such a wage complaint can be heard within 2 to 3 months from when it was filed. In the Superior Court, it could be over a year before a case is heard. Also, the hearing officer will render a decision within 30 days after the completion of the hearing.

Whether commissions are due depends on what the written policy is that was provided to the employee and what it states in regards to when commissions are due and owing. An employer runs a substantial risk of losing a sales commission dispute as to when and if a commission is due if it does not have a clear written policy about payment of sales commission that was given the employee before he did the work that he claims entitles him to a commission. There is a distinction between when the employee has the right to a commission and when a commission is actually due. There are three major events in a sale important to a commission. The first is when the salesperson books the order making the sale on behalf of the company. The second is when the company accepts its employee's sale to the customer. The third is when the customer has paid for the sale. Often companies clarify in writing that the commission is not due until the customer has paid, however, that does not mean that the commission was not earned by the employee. If the employee booked the sale on behalf of the company and the company has accepted the sale, the employee either quits, is laid off, or is fired, and the customer thereafter pays for the sale, the question becomes whether the commissions are owed the former employee. Under New Hampshire law, absent there being a written agreement or policy that sales commissions are not earned unless the sale is paid for by the customer prior to the termination of employment, an employee is entitled to commissions on sales closed as of the termination date; meaning that the customer sale has been accepted by the company as opposed as to when the sale order is collected. The commission may not be due until after the employee leaves his employment because the customer still has not paid, yet it will need to be paid once the customer has paid.

It is possible that the Department of Labor hearing officer might award liquidated damages up to twice the amount due. If the employee is thereafter represented by counsel, he may be able to get her attorney's fees in the Superior Court.

J. Daniel Marr is a Director and Shareholder at Hamblett & Kerrigan, P.A. His legal practice includes counseling businesses and individuals on a variety of legal issues and advocating on their behalf. Attorney Marr is licensed and practices in both New Hampshire and Massachusetts. Attorney Marr can be reached at dmarr@nashualaw.com.

Thursday, January 15, 2015

Do Not Ignore a Bankruptcy Trustee’s Preferential Transfer Demand Letter

It is possible that you individually or your business may find that someone who owes you money has filed for bankruptcy. Sometimes not only does that debtor leave a portion of the debt owed to you unpaid, but, to add insult to injury, the bankruptcy Trustee, debtor-in-possession, or the Unsecured Creditor’s Committee sends a demand letter asking for the return of that portion of the debt repaid to you which you received within 90 days before the bankruptcy filing. This is a preferential transfer claim under bankruptcy law. There are defenses to preferential transfer claims. Certain payments made to you either in the ordinary course of business or before you gave new value to the debtor may not have to be paid back. The key is to contact an attorney to see if you have a defense. If you do and your company attorney responds to the demand letter with a good explanation of that defense and the facts with supporting documents, the claim may go away or be reduced even if it is an out-of-state bankruptcy. If you ignore the demand letter, you increase the likelihood of being sued, perhaps in an out-of-state bankruptcy court where you would then have to hire an out-of-state attorney if you desire to defend yourself.

J. Daniel Marr is a Director and Shareholder at Hamblett & Kerrigan, P.A. His legal practice includes counseling businesses and individuals on a variety of legal issues and advocating on their behalf. Attorney Marr is licensed and practices in both New Hampshire and Massachusetts. Attorney Marr can be reached at dmarr@nashualaw.com.