NonCompete and equivalents..
My acquaintance, a quant trader, had a non compete of 5 months at a quant hedge fund. He left the firm, and after the non compete ended, his exEmployer sued him to try to get an injunction, with barely any facts. Given the pending injunction, which takes a lot of time for even straight forward decision, it effectively turned into a judicial non compete, not many firms interested in even interviewing him in view of the pending litigation. Obviously he is not getting paid anything, on top of having to fight this injunction. His exEmployer's only wish seems to be to get a longer non compete, one way or the other.
(i) He is confused, if firms can get away with stuff like this, why isn't every firm suing their senior employees to get a longer non compete, one way or the other. Some thing is amiss...
Any opinions or suggestions?
Anyone can sue anyone else. It's common for employers to require very long noncompetes for quant strategies. Shadier funds might try to stall you long enough to harvest 100% of the alpha, which may have a half life of 2 years, even though they know they will likely lose at court. Typically the legal argument is that your friend knows so much about the firm's trading strategies that it's impossible to let anyone else hire him without divulging fundamental trade secrets. If he's adhered to the letter of his non-compete, these efforts are almost never ultimately successful. Nevertheless, if your friend isn't doing something too similar in his new job, it's possible to settle it by promising not to run similar strategies at the new place.
However, keep in mind your friend may not be a reliable witness. Sometimes workers don't follow their non-competes to the letter, and they act shocked when their employer takes them to court to enforce it. From an employer's standpoint pulling this kind of crap is not always a good idea. You've basically announced to the world that a former employee was a key source of alpha. Occasionally this maneuver can backfire, with rival firms competing to hire the former employee and even paying to defend him against the injunction in court.
Your friend should get advice from a lawyer and not online forums. And yes, he will have to pay that lawyer.
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