Massachusetts Legislature Fails to Pass Bill to Ban Noncompetes and Adopt the UTSA

Employers in the Commonwealth of Massachusetts can breathe a sigh of relief now that the Massachusetts legislature has rejected a bill to ban noncompetition agreements. The effort to outlaw noncompetes in the Commonwealth has been underway since 2009, and numerous bills to reform noncompete and trade secret law have been proposed and rejected since that time. However, earlier this year, Massachusetts Governor Deval Patrick joined in the effort to outlaw noncompetes and reform Massachusetts trade secret law, garnering more support for the effort than it had ever received. In April, the governor proposed a bill to ban noncompetition agreements in the Commonwealth. The bill also proposed that Massachusetts adopt the federal Uniform Trade Secrets Act (UTSA). Massachusetts is one of the few remaining states that has not adopted the UTSA. Despite the support of the governor and many legislators, even a watered-down version of the bill failed to pass in the most recent legislative session, which ended on July 31, 2014.

Massachusetts businesses can rest easy for now, but noncompete and trade secret law reform efforts in Massachusetts undoubtedly will resume when the legislature reconvenes for the 2014-2015 legislative session.