Indiana Business Law Blog
Consider these two relatively recent cases, one from Massachusetts and one from Indiana, both involving allegations of breach of contract through the use of social media:
- A vice president of a recruiting firm leaves her job and goes to work for another recruiting firm. She has a covenant not to compete with her first employer that prohibits her from providing recruiting services within a specified list of “fields of placement” and within a specified geographic area. She updates her LinkedIn profile to reflect the new job. A message goes out to her list of over 500 contacts, including a number of her former employer’s customers. Her former employer sues, alleging (among other things) that her LinkedIn update violated the covenant not to compete.
- The agreement between an IT contractor and one of its subcontractors prohibits the subcontractor from soliciting or inducing the contractor’s employees to leave their jobs. The subcontractor posts a job opening on LinkedIn where it could be viewed by anyone who had joined a particular public group. One of the contractor’s employees sees the job posting, contacts the president of the subcontractor, and expresses an interest in the job. At a later meeting, the employee tells the subcontractor his compensation requirements and what he is looking for in a job. The subcontractor makes an offer of employment, and it is accepted. The contractor sues the subcontractor for breach of the covenant not to solicit its employees.
Although the law sometimes struggles to keep up with technology, in each of these cases the court decided the issue very readily, relying on standard contract law.
The first case is KNF&T, Inc. v. Muller, a case filed earlier this year in Massachusetts Superior Court. In filing the lawsuit, the plaintiff asked for a preliminary injunction. After reviewing the law on covenants not to compete and explaining that they are to be construed narrowly, the court denied the plaintiff’s request, noting that, although Ms. Muller’s LinkedIn profile mentioned things such as “staffing services” and “recruiting,” it made no mention at all of any of the fields of placement that were listed in her covenant not to compete and, therefore, did not breach her agreement with KNF&T.
The second case is Enhanced Network Solutions Group, Inc. v. Hypersonic, decided by the Indiana Court of Appeals in 2011. In doing so, the court had to determine the meaning of “solicit” and “induce,” as those words were used in the covenant not to solicit the contractor’s (ENS’s) employees. Because neither the contract nor Indiana case law defined them, the court looked to the ordinary dictionary definitions. Citing Black’s Law Dictionary, the court explained that “soliciting” involves requesting or seeking to obtain something, and “inducing” means enticing or persuading someone to do something. The court held that Hypersonic did not solicit or induce the employee to leave ENS, but rather the employee solicited Hypersonic. In fact, it appears that the court did not even consider the LinkedIn job posting as a close call, mentioning only that the employee “made the initial contact with Hypersonic after reading the job posting on a publicly available portal of LinkedIn.”
Do these cases mean that one cannot violate a noncompete agreement or a nonsolicitation agreement by posting something on a social media site? Not at all. In fact, it seems entirely possible that the Massachusetts case would have gone the other way if Ms. Muller’s LinkedIn profile had mentioned one fields of placement from which she was barred by her agreement with her former employer. Similarly, the Indiana case might have gone the other way if someone from Hypersonic had sent an email message specifically addressed to the ENS employee with a link to the LinkedIn job posting, particularly if the message encouraged him to apply.
Indeed, what is noteworthy about these cases is that the social media aspect of them had no bearing on the courts’ analyses. The Massachusetts case would likely have turned out the same way had Ms. Muller sent out paper announcements saying the same thing her LinkedIn profile said, and the Indiana case would likely have turned out the same way had the job posting been a classified ad in a newspaper. The courts had to plow no new ground to deal with them.
In that sense, these cases are unremarkable. Remarkably so.