[Consultation] Measures for civil and criminal response regarding former executives of the same industry.

IT service company A received news that former executive B transferred to competitor C within the same industry. Accordingly, they inquired about potential legal responses in civil and criminal matters.

Veat consulted with former executive B and A regarding whether they had previously entered into a ▲transfer restriction agreement with C, ▲whether there was a violation of the Competition Act, and ▲the possibility of seeking an injunction (including a provisional injunction), and ▲the possibility of a provisional injunction, and ▲whether there was a crime of abuse of position in commercial transactions under the Criminal Code, along with ▲digital forensic methods to prove the circumstances.

A transfer restriction agreement or a restraint of competition agreement is an agreement in which an employee agrees not to engage in competitive activities, such as employment with a company in a competitive relationship after retirement.

In particular, if a former employee with a transfer restriction agreement resigns and joins a company in the same industry, it can be regulated solely based on the breach of contract without proving whether the employee has violated a trade secret.

However, even in the case of a transfer restriction agreement, if it excessively restricts the employee's right to choose a profession or restricts competition excessively, it is invalid. Therefore, it is necessary to draft it while reflecting the interests of both the employer and the employee, considering various legal provisions.

Law firm Veat provides effective legal advice to prevent such disputes based on its experience in handling numerous transfer restriction, restraint of competition, and trade secret protection disputes.

If you need legal advice related to transfer restriction, restraint of competition, trade secret protection, and digital forensic, please contact us at here.