Thursday, August 11, 2016

What does "solicit" mean in nonsolicitation agreements?

Nonsolicitation clauses are fairly common in restrictive covenants. The contract will say something like, "Upon termination, Employee shall not solicit customers of Employer for a period of two years" (it is also common to forbid solicitation of employees). What exactly does "solicit" mean though?

Meyer-Chatfield v. Century Business Srv., Inc., 732 F.Supp.2d 514 (E.D. Pa. 2010) has an entire section under the headline "Meaning of Solicitation." The Court turns to Black's Law Dictionary:
To appeal for something; to apply to for obtaining something; to ask earnestly; to ask for the purpose of receiving; to endeavor to obtain by asking or pleading; to entreat, implore, or importune; to make petition to; to plead for; to try to obtain; and though the word implies a serious request, it requires no particular degree of importunity, entreaty, imploration, or supplication. To awake or incite to action by acts or conduct intended to and calculated to incite the act of giving. The term implies personal petition and importunity addressed to a particular individual to do some particular thing. Black's Law Dictionary, p. 1392 (6th ed. 1990).
At this point, I should note that Black's Law Dictionary has undergone numerous revisions since the 6th Ed. in 1990. The 10th edition (2014) defines "solicitation" as:
1. The act or an instance of requesting or seeking to obtain something; a request or petition . . . .
4. An attempt or effort to gain business. • The Model Rules of Professional Conduct place certain prohibitions on lawyers' direct solicitation of potential clients.
I omitted the less relevant prostitute-y/criminal definitions.

I found this portion of the Meyer-Chatfield opinion particularly interesting:
Also relevant here is Aetna Bldg. Maintenance Co. v. West, 246 P.2d 11 (Cal. 1952). Aetna concerned an agreement where the defendant may not "solicit, serve and/or cater to any of the customers of the [plaintiff] Company served by him." Id. at 13. Despite the additional language of "serve and/or cater" modifying solicit, the court still held that "[m]erely informing customers of one's former employer of a change of employment, without more, is not solicitation. Neither does the willingness to discuss business upon invitation of another party constitute solicitation on the part of the invitee."
That gives employees who sign nonsolicitation agreements a lot of wiggle room.