Opinion ID: 6227055
Heading Depth: 1
Heading Rank: 1

Heading: introduction

Text: This case addresses the enforceability of a non-compete agreement restricting Lorna Gagnon (“Gagnon”), a former employee of Prudential Locations, LLC (“Locations”), from “establishing her own brokerage firm in the State of Hawai‘i within one year after terminating her employment with Locations” and from soliciting persons “employed” or “affiliated with” Locations. At issue are two restrictive clauses within the non-compete agreement: a non-compete clause and a non-solicitation clause. We hold as follows: (1) the ICA erred in failing to address whether the non-compete and solicitation clauses were ancillary to a legitimate purpose not violative of HRS Chapter 480, as required by HRS § 480-4(c) (Supp. 2015); (2) restricting competition is not a legitimate ancillary purpose, as HRS § 480-4(a) prohibits contracts in restraint of trade or commerce in the State; (3) to establish a violation of a nonsolicitation clause, there must be evidence that the person subject to the solicitation clause actively initiated contact; and (4) summary judgment was properly granted in favor of Gagnon as to the non-compete clause, but summary judgment should not have been granted for one agent as to the non-solicitation clause due to a genuine issue of material fact regarding whether Gagnon actively initiated contact. 2  FOR PUBLICATION IN WEST’S HAWAI‘I REPORTS AND PACIFIC REPORTER  We therefore vacate the Intermediate Court of Appeals’ (“ICA”) July 2, 2020 judgment on appeal and the Circuit Court of the First Circuit’s (“circuit court”) December 9, 2016 final judgment in favor of Gagnon and remand to the circuit court only with respect to the alleged breach of the solicitation clause as to one agent. We otherwise affirm the judgments of the ICA and the circuit court.