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USI wins temporary injunction in non-compete clause case



A federal appeals court has upheld a preliminary injunction enforcing a non-compete agreement in a lawsuit filed by USI Insurance Services LLC against a former employee who left to join Alliant Insurance Services Inc.

Michael Aitkin and USI are said to have entered into a binding employment agreement in April 2018, in which Aitkin agreed to refrain from competing with USI during his employment and to give 60 days notice of his resignation, according to court papers in Michael Aitkin v. USI Insurance Services LLC et al.

In February 2021, he abruptly resigned his position as a commercial agricultural insurance broker in Hermiston, Oregon, without giving the required 60 days notice, and immediately began working for Alliant, USI said in court papers, accusing him of having already redirected USI customers to Alliant.

The U.S. District Court in Portland, Oregon, agreed to issue a preliminary injunction enforcing the non-compete clause and was upheld by a three-judge panel of appellate courts at the Ninth U.S. District Court in San Francisco on Friday.

“The district court did not make a manifest error,”

; it is stated in the judgment. It “properly considered the interests of” non-parties “such as Aitkin’s former USI clients and balanced them against the public interest in maintaining valid contracts, it said.

The panel said it “is not left with a ‘definitive and firm conviction that a mistake has been made'”, citing a previous case and confirming the lower court’s decision granting the preliminary injunction.

Lawyers in the case did not respond to requests for comment.

In February, a Pennsylvania appellate court upheld a 2020 ruling in which a lower court awarded the USI $ 1.1 million in litigation over a former employee’s alleged failure to comply with its non-compete agreement.


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