You had the vision. You took the risk. You funded the business, trained the team, secured the clients, and built something from the ground up. But now, the very people you empowered are trying to push you out: they’re taking your clients, your know-how, and your business model with them. To make matters worse, you never had them sign any employment, non-compete, non-disclosure, or non-solicitation agreements.
If this sounds familiar, you’re not alone. Many entrepreneurs in Florida (and beyond) make this mistake, often out of trust, speed, or lack of legal guidance early on. So what can you do now?
The Bad News: No Contract, No Restriction
In Florida, courts generally uphold restrictive covenants like non-compete and non-solicitation agreements if they are in writing and meet specific statutory requirements, like the protection of legitimate business interest. Without a written agreement, your ability to prevent a former employee from competing with you or soliciting your clients is severely limited.
So, if your employees never signed anything, you likely can’t rely on restrictive covenants to stop them from:
- Starting a competing business
- Taking your clients with them
- Recruiting your remaining employees
But don’t lose hope! There are still legal tools available.
The Good News: Other Legal Theories May Help
Even without a contract, there may be legal options to protect your investment and hold wrongdoers accountable:
1. Trade Secret Misappropriation
If your former employees are using confidential information (client lists, pricing models, marketing strategies, vendor contacts, etc.), you may have a claim under the Florida Uniform Trade Secrets Act.
To qualify as a trade secret, the information must:
- Derive independent economic value from not being generally known; and
- Be subject to reasonable efforts to maintain its secrecy.
If successful, you could obtain an injunction and even monetary damages.
2. Breach of Fiduciary Duty
If any of the employees were executives, officers, or held positions of trust, they owed you a fiduciary duty while still employed. Secretly planning a competing venture or diverting opportunities could amount to a breach of fiduciary duty, a serious civil wrong.
3. Tortious Interference
If your ex-employees are actively trying to poach your clients or interfere with your existing contracts, you might have a claim for tortious interference with contractual or business relationships.
This doesn’t require a non-compete, just proof of intentional and unjustified interference.
4. Unjust Enrichment or Constructive Trust
In some cases, courts may intervene in equity if someone unjustly benefits from your investment, training, or resources without compensating you. It’s a tough path, but sometimes available where more direct contract claims fail.
What You Should Do Now
- Act Quickly: Delay can harm your case. Courts are more likely to intervene when a business owner acts promptly to protect their rights.
- Secure Your IP and Assets: Make sure your business information, trademarks, client data, and documents are protected and backed up.
- Gather Evidence: Document everything (emails, texts, contracts, client records, access logs, etc.) – anything that shows what the former employees did and when.
- Talk to a Business Litigation Attorney: A qualified attorney can help you evaluate your options, send cease-and-desist letters, or file an emergency injunction if needed.
The Takeaway: Prevention is Always Cheaper Than Litigation
This situation is painful, but preventable. Even if you’re still in damage-control mode now, this is the time to put enforceable agreements in place for your current and future team. A well-drafted set of employment documents can include:
- Non-compete and non-solicitation clauses (as permitted by Florida law)
- Confidentiality agreements
- IP assignment clauses
- Dispute resolution provisions
If you would like to learn more about how to protect your business in Florida, do not hesitate to contact one of our experienced business attorneys at EPGD Business Law. With offices in Miami, Florida, we are ready to assist you. Call us at (786) 837-6787 or email us to schedule a consultation.
EPGD Business Law is located in beautiful Coral Gables. Call us at (786) 837-6787, or contact us through the website to schedule a consultation.
