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Law Educator, Esq.
Law Educator, Esq., Attorney
Category: Employment Law
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Experience:  20+ Years of Employment Law Experience
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I sold my service business on the Oregon Coast in 2006. The

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I sold my service business on the Oregon Coast in 2006. The sale price included a ten year non-compete. This year the buyer decided to pay me off rather than complete the ten year payment period. During that negotiation I asked about me having permission to go back into business since he was no longer going to be paying me. He stated in writing that as long as I did not solicit/target their clients he would leave me alone. Based on that information I obtained the proper licensing, insurance etc. and have started my business. While I have not even begun advertising or soliciting clients the community has learned I am back in business and is coming to me. Three of their clients have come to me wanting me to provide service to them. Where do I stand?

Thank you

Wiley Sanders
Thank you for your question. I look forward to working with you to provide you the information you are seeking.

If he gave you written release from the non-compete, then this would be valid to change the terms of the non-compete you originally had. If you have not solicited as he stated then you would not be in violation. It is not a violation if people without contact from you to encourage them, come to you on their own it is not solicitation so this would arguably not violate the non-compete release you obtained. If you have not solicited the former clients and when you open your business up they come to you without you ever contacting them to do so, then this could be seen as you not contacting or targeting so as to not violate the non-compete he modified for you.

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Customer: replied 3 years ago.

Thank you for your reply. There was not a formal change in the agreement but the following is the E-mail string. Does your information still apply?

I am not comfortable with a formal release, you will have to decide how much risk you have with my word that I would not choose to take action if you were doing pest control as part of your construction business, not targeting our customer or employees. I have never aggressively enforced a non-comp in all my years, even when I had very good reason to do so. It is just not good business for me to give up that choice if it should be needed.


From: Wiley Sanders [[email protected]]
Sent: Monday, July 15, 2013 5:25 AM
To: Jack Marlowe
Subject: RE: Merrill Schedule




Suzie has the routing and account numbers for our account for the monthly deposits. Does that work?

I would really like a release to be in pest control (without soliciting Eden clients) if possible.






From: Jack Marlowe [[email protected]]
Sent: Friday, July 12, 2013 2:39 PM
To: Wiley Sanders
Subject: RE: Merrill Schedule




I have verified that Rentokil did not assume any rights regarding your non-comp. That being said, I am uncomfortable with giving you money to compete against us. That being said, I don’t want to keep you from making a living as long as you don’t target our accounts or take our employees. The only way that I see is to keep the agreement in force against the unlikely event that you would begin targeting our customers or hiring away our employees, but give you my word that, short of you doing something inappropriate, I will not pursue enforcement if I discover that you have started your own company (it would also be inappropriate to operate as Merrill).


From: Wiley Sanders [[email protected]]
Sent: Wednesday, July 10, 2013 4:32 PM
To: Jack Marlowe
Subject: RE: Merrill Schedule


The amount is consistent with what we show here. However, I would like to know if there is a way we can agree to terminate my non-compete. I understand that you said you would not pursue anything unless I were soliciting Eden clients. I just want to be sure that I have a leg to stand on. At this time I am only interested in Coos and Curry Counties and at this time only myself. I do not want any employees right now. My agreement is with Marlowe Enterprises, Inc. and not RentoKil so I do not see what they would have to say about anything since the agreement states that it cannot be assigned to another party without me accepting the assignment.

Thank you for your response and clarifying it was not a formal release.

AS you see he is telling you to take your chances, but he would not pursue you as long as you do not take his customers. Once his customers leave and go to you, even if you did not "target" them he is going to seek to come after you and the email just telling you as long as you do not go after current customers would not be valid as a change in the non-compete agreement I am afraid.

This is risky and you would have to avoid soliciting or making any contact with their former customers.
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