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NELF Files Amicus Brief in Miele v. Foundation Medicine, Inc. to Clarify Scope of Massachusetts Noncompetition Agreement Act
Boston, MA – January 31, 2025 – The New England Legal Foundation (NELF) has filed an amicus brief in the Massachusetts Supreme Judicial Court in Miele v. Foundation Medicine, Inc., addressing the critical question of whether the Massachusetts Noncompetition Agreement Act (G. L. c. 149, § 24L) applies to forfeiture-for-solicitation agreements. The Court’s ruling on this matter could have significant implications for businesses seeking to protect their workforce investments.
At issue is whether an employee’s agreement to forfeit severance pay upon violating a non-solicitation provision constitutes a “noncompetition agreement” under the Act. The Superior Court ruled that it does, holding that the employer must pay the former employee $1.5 million in severance, even though she actively encouraged colleagues to leave and join her at a competing company.
In its amicus brief, NELF argues that the Massachusetts Noncompetition Agreement Act explicitly excludes non-solicitation agreements from its definition of noncompetition agreements. A forfeiture-for-solicitation clause functions in the same manner as a traditional non-solicitation agreement—it discourages solicitation through financial consequences rather than litigation. The Massachusetts Supreme Judicial Court has long recognized that different legal doctrines apply to noncompetition and non-solicitation agreements, and the lower court erred by conflating the two.
NELF’s brief further argues that the Act’s legislative history and judicial precedent support the conclusion that forfeiture-for-solicitation agreements should be treated like non-solicitation agreements, not noncompetition agreements. The Superior Court’s ruling, if upheld, could create uncertainty for employers across Massachusetts and limit their ability to enforce reasonable employee retention agreements.
The Massachusetts Supreme Judicial Court’s decision in this case will have far-reaching implications for businesses and employees alike. NELF remains committed to ensuring that contract law is interpreted in a way that respects both legislative intent and the rights of employers and employees.
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About the New England Legal Foundation: Founded in 1977, the New England Legal Foundation (NELF – www.newenglandlegal.org) is the leading non-partisan, non-profit public interest law firm in the region dedicated to economic liberty. NELF’s ongoing mission is to champion free enterprise, property rights, limited government based on rule of law, and inclusive economic growth. We believe that free enterprise is a foundational value of a democratic society and the best opportunity for people to lift themselves to prosperity.