354: Navigating a Litigious World - with Dino Antonopoulous Social Capital

Meet DinoAntonopoulos Legal Group LLC represents closely held companies and financial institutions in corporate/business law, real estate law, civil litigation, commercial financing, estate planning, and probate matters. The number one goal of the firm is to help clients succeed and to protect them by continuing to be a difference-maker and game-changer in the legal world by applying our principles - honesty, hard work, loyalty, and a commitment to fight for our clients.
How do you minimize litigation risk when hiring from a competitor?Yeah, so we see this, obviously, more and more. In today's world it's a little bit of a litigious world. But as we have our companies and companies out there that market and recruit various potential candidates and recruits, some of these recruits sometimes are under an employment agreement. Or it could be under various documents, such as handbooks or policies, commission agreements, and stock option agreements. And there are what we call restrictive covenants. So it could be a non-compete and non-disclosure of some sort. But these various restrictive covenants might limit the opportunity they have with that new company that they're going to be onboarding with. So as part of the interview process, you want to ask the potential recruit whether they have any restrictive covenants that they know of. But you got to dig a little bit deeper and say, "Okay, what have you signed? What have you received in your employment with your current employer?" And then ask those specific questions. Do they have an employment agreement? Do they have some sort of bonus plan, a commission agreement, a stock option agreement, or any sort of compensation agreement? The more that you dive into asking those specific questions the more it might trigger that recruiters say, "Oh, yeah, you know what, I did sign an employee handbook. Let me just take a look at that and see what that says." So you start there first. And then ultimately, if the recruit says no, and the interview goes, well, and you're ready to hire this recruit, then eventually you'd like to have that same sort of written confirmation from that recruit, which will be your employee, saying that no restrictive covenants exist. If one does exist, as that employer, that potential employer and you want to hire that individual, then you should get a copy of it to see what the restriction is to see whether it's enforceable or not. And that's where the legal starts to come in on that. So as we represent closely held companies, you know, we'll come across this issue all the time. And the ones that stay ahead of this are in the better position, where they'll contact us in this case, ask us to review this employment agreement or wherever these restrictive covenants are found and whether it's enforceable or not. And if we say yes, it is, then we kind of do a hard pass on that employee or we can always go back and negotiate some sort of buyout with or a resolution with that current employer as well. The ones that it becomes a little bit more pricey on and expensive and a little bit more of a headache or the ones that just kind of blindly hire the employee. And then a month or two down the line, you get a letter from a law firm saying that, hey, that employee was under some sort of restrictive covenant, and you're part of that right now and you're torturously interfering with that. And all of a sudden, we got a kind of a scramble and an issue with that. So there are the steps that we can take to minimize the risk, assess the risk, and then make a determination like anything in business. And as something that, you know, our key. Companies are really honing in on more and more today.
Is that a conversation you have early on in the interviewing process?Yeah, I think if the interview is going well, for you, and you really feel like that's a strong candidate, a strong...