Novo Nordisk Can’t Enforce Noncompete Against Briefly Laid Off Employee

The First Circuit affirmed a district court judgment that prevented pharmaceutical company Novo Nordisk Inc. from enforcing a confidentiality and noncompete agreement that it had entered into with a worker who was briefly laid off and rehired before leaving the company for BioMarin Pharmaceutical Inc. Russomano v. Novo Nordisk Inc., 1st Cir., No. 20-1173, 6/2/20.

Novo sought to enforce the agreement, signed with Thomas Russomano, to prohibit him from working for a competitor for a year after the end of his employment. Russomano was laid off in 2018 and then rehired, but wasn’t asked to sign a new agreement upon his return.

Russomano filed suit first, seeking declaratory judgment, after which Novo filed counterclaims.

The district court denied Novo’s motion for a preliminary injunction, rejecting Novo’s argument that it didn’t lay off Russomano. Instead, the company argued, it transferred him to a different position in the company. The First Circuit affirmed, finding Novo’s argument was “without merit.”