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COURT TOSSES DELTEK NONCOMPETES

A federal court has thrown out non-compete clauses that affected five former Deltek employees who started a business, Iuvo Systems, founded in early 2008, to compete against their former employer.

The U.S. District Court for Eastern Virginia ruled that the non-compete provisions for Tom Truong, Hai Truong Edward Muldrow, Sandra Levy, and Lynn Varan were too broad. The decision cited the fact that Muldrow and Tom Truong had two-year non-competes while the others were only limited to one year as a recognition by Deltek that two years was not reasonable. In partially granting the defendants' motion for summary judgment, the court also dismissed Deltek's claims of breach of contract and a variety of claims including tortious interference with contracts and with business relationships and violation of the Virginia's Trade Secrets Act that it had been filed against Levy and Varan. The court noted in Levy's case, the only evidence regarding Levy's alleged competition using Deltek information was that she had told two customers that Iuvo's prices were lower than Deltek's. The court also held that a Statement of Work that Levy showed customers contained no proprietary Deltek information However, it denied the defendants’ motion for summary judgment on trademark infringement and cyber squatting claims and others claims against the two Truongs and Levy, including the allegations of tortious interference, breach of fiduciary duty and violation of the Trade Secrets Act, which means the remaining allegations can go to trial.

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