The Bark of the Covenant: A Cautionary Look at Non-Compete Clauses and Other Restrictive Covenants That Can Come Back to Bite You

The importance of restrictive covenants has been brought sharply into focus by the Theranos case, profiled in the popular HBO documentary The Inventor: Out for Blood in Silicon Valley. So how does a Stanford dropout raise over $9 billion to fund a startup based on little more than a promise to “revolutionize medical testing” and technology that doesn’t even exist? A big part of the answer lies in the legally-binding NDAs that kept Theranos employees and company insiders from divulging what they knew.

In this article, Jeff Asperger, a leading litigation attorney at MPS Law, offers an in-depth analysis of NDAs and other restrictive covenants from the perspectives of both employer and employee.