If you were an adolescent in the 1990s, there is no doubt you remember some of the classic Hair Club for Men commercials where men would smile while woman rubbed their hands across thick luscious clumps of natural looking hair on a man standing nearby. I recall friends reenacting the adds in middle school and high-school, and yes, that means I am dating myself.
Don’t know what I am talking about? Enjoy this little trip down memory lane: https://www.youtube.com/watch?v=elXcg92enHw
Recently, the Hair Club has made news again and not just for their signature “I’m also a client” tag line. Hair Club for Men (HCFM) recently filed a significant lawsuit against an ex-employee in the Eastern District of Virginia, alleging the employee had breached her contract, taken trade secrets, interfered with their business, etc. HCFM even asked the court to shut down the ex-employee’s new salon as they claimed her ability to attract their clients would cause them irreparable harm.
If you want to read the very clear and detailed opinion, the link is available here: https://frithlawfirm.com//non-compete/wp-content/uploads/sites/4/2016/06/hair-club-non-compete-case.pdf
Interestingly, the employee won the injunction on all counts as the court can only grant an injunction under Virginia law, if the filing party is likely to succeed on the merits of the underlying claims AND the possible harm is not calculable. Meaning, you can only enjoin someone from working, if the evidence thus far supports the allegations that the ex-employee breached a reasonable contract and have as a result, caused irreparable and un-calculable harm to the other side.
Thankfully, it is a very high burden of proof – and difficult for parties to meet the burden.
The Court in my opinion, does an excellent job of clearly addressing each and every issue in the case. The real question will be whether Hair Club takes the hint. If a judge says you have no likelihood of succeeding in your multi-count lawsuit, you should drop the suit, call your lawyers and have them craft a better contract, consider it a learning experience and move on.
The lawyers for Hair Club are hopefully giving that advice to their clients right now, but sometimes it takes a judge saying – YOU HAVE NO CASE for clients to get the picture. The real tragedy is that lawyers should always advise their clients as to whether their case can be successful, and if not, suit shouldn’t be filed.
In sum, while I will always think fondly about the lady with the hair dryer – I will now also think fondly of the court in the above case, making sure Virginia’s laws on non-compete litigation is strictly applied and bad contracts not enforced.