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N Cal Atty
N Cal Atty, Lawyer
Category: Legal
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Experience:  attorney at self
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I sold my online internet business 15 months ago and had a 5

Customer Question

I sold my online internet business 15 months ago and had a 5 year non compete , in Arizona can I break to 2 years or less. no trade secret or anything just a clothing business.
Submitted: 10 months ago.
Category: Legal
Expert:  WALLSTREETFIGHTER replied 10 months ago.

If you signed a non compete in AZ, it is possible it can be enforced, unless they are no broader than necessary to protect an employer's legitimate protectable interests. Generally speaking, this means that a non-compete must be reasonable in time, usually 12 months or less, and be reasonable as to geographic scope, usually less than a nationwide, statewide or county-wide scope.

Expert:  WALLSTREETFIGHTER replied 10 months ago.

A 5 year non compete agreement, would be difficult to enforce against you,

Expert:  WALLSTREETFIGHTER replied 10 months ago.

Typically Arizona Courts look closely at whether the non-compete agreement should be enforced given the impact the non-compete will have on the employee. To be enforceable the Court will look at the following factors: 1) is there a legitimate business purpose for the non-compete; 2) did the employee receive any benefit for the agreement; 3) is the agreement reasonable in time and scope; and 4) does the agreement violate public policy.

Expert:  WALLSTREETFIGHTER replied 10 months ago.

Unless the buyer can prove actual financial disadvantage from you working, I do not see how a Court would enforce a 5 year non compete.

Expert:  WALLSTREETFIGHTER replied 10 months ago.

Good luck, and if you have any further questions please do not hesitate to ask, if satisfied with our service please provide us with positive feedback, thank you

Customer: replied 10 months ago.
The sale of the business wasn't online Internet clothing which is worldwide so the limitation was so I could not compete anywhere in the entire world with this agreement I sold clothing and accessories which are just standard Brands you can buy off any Shelf
Customer: replied 10 months ago.
Posted by JustAnswer at customer's request) Hello. I would like to request the following Expert Service(s) from you: Live Phone Call. Let me know if you need more information, or send me the service offer(s) so we can proceed.
Customer: replied 10 months ago.
I meant to say it was an online business
Customer: replied 10 months ago.
your answer is canned answer for employees not the sale of a business
Customer: replied 10 months ago.
if I compete with then ther would a be a financail iisue for them
Customer: replied 10 months ago.
sorry can't type good
Customer: replied 10 months ago.
i want a refuind
Expert:  WALLSTREETFIGHTER replied 10 months ago.

a non compete for the sale of a business, still follows the same rules as an employment non compete, the main difference is that the sale of business non competes the Courts will consider the provisions more in favor of the buyer, as the seller and buyer were in similar positions when signed, if the non compete had a 5 year clause, that is still way above the norm for non compete agreements,

Expert:  WALLSTREETFIGHTER replied 10 months ago.

However, if you are going to directly compete with them, the Courts could favor them as they would be a financial loss if you started to directly compete after two years.

Expert:  WALLSTREETFIGHTER replied 10 months ago.

the court will determine whether the agreed upon period of time is reasonable by evaluating the type of business and the interests of the two parties, in your situation it will depend on how much financially they could suffer from direct competition.

Expert:  N Cal Atty replied 10 months ago.

New Expert here.

Does the non competition agreement have any geographical limitations?