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District Court Interprets Kentucky Franchise Covenants Not-to-Compete
In Papa John's International, Inc. v. Rezko et al., 2006 WL 1697134 (N.D. Ill.), the U.S. District Court for the Northern District of Illinois was called upon to determine whether a post-term covenant not-to-compete was reasonable in scope. The defendant alleged that the covenant would bar him from the restaurant business nearly everywhere in the country. In the limited procedural posture of the case (a motion to dismiss), the court allowed the claim of unreasonableness to go forward.
Rezko, through a number of companies, was a long-time franchisee of Papa John's, with numerous stores in Illinois and Michigan. Rezko personally signed the franchise and owner agreements for each store. Those agreements contained a covenant not-to-compete. The covenant precluded Rezko for a period of 2 years after termination or expiration from engaging in competitive activities within a 10-mile radius of Rezko's particular restaurant or any location where Papa John's or any of its franchisees conduct a Papa John's business. Rezko also signed separate owner's agreements, which contained an identical covenant not-to-compete. The owner's agreement also has a clause stating that the owner agrees that the 'covenants and agreements … are, taken as a whole, reasonable with respect to … geographic scope and duration, and no party shall raise any issue of the reasonableness of the areas, activities or duration of any such covenants in any proceeding to enforce any covenants.'
The DOJ's Corporate Enforcement Policy: One Year Later
The DOJ's Criminal Division issued three declinations since the issuance of the revised CEP a year ago. Review of these cases gives insight into DOJ's implementation of the new policy in practice.
The DOJ's New Parameters for Evaluating Corporate Compliance Programs
The parameters set forth in the DOJ's memorandum have implications not only for the government's evaluation of compliance programs in the context of criminal charging decisions, but also for how defense counsel structure their conference-room advocacy seeking declinations or lesser sanctions in both criminal and civil investigations.
Use of Deferred Prosecution Agreements In White Collar Investigations
This article discusses the practical and policy reasons for the use of DPAs and NPAs in white-collar criminal investigations, and considers the NDAA's new reporting provision and its relationship with other efforts to enhance transparency in DOJ decision-making.
Bankruptcy Sales: Finding a Diamond In the Rough
There is no efficient market for the sale of bankruptcy assets. Inefficient markets yield a transactional drag, potentially dampening the ability of debtors and trustees to maximize value for creditors. This article identifies ways in which investors may more easily discover bankruptcy asset sales.
Compliance Officers: Recent Regulatory Guidance and Enforcement Actions and Mitigating the Risk of Personal Liability
This article explores legal developments over the past year that may impact compliance officer personal liability.