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From: Laws@SRI-AI.ARPA
Newsgroups: net.ai
Subject: Noncompetition Clauses
Message-ID: <12213@sri-arpa.UUCP>
Date: Sun, 8-Apr-84 21:14:52 EST
Article-I.D.: sri-arpa.12213
Posted: Sun Apr  8 21:14:52 1984
Date-Received: Tue, 17-Apr-84 08:30:42 EST
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From:  Ken Laws <Laws@SRI-AI.ARPA>

This is the first I've heard of the post-employment restrictions
Scott Fahlman mentioned, although I've heard of noncompetition agreements
in other industries.  (I believe Nolan Bushnell, for instance, started
Pizza Time Theaters because he couldn't compete with his own creations
at Atari.  I've also heard of cases in the giant-screen TV and
restaurant businesses, always part of a buy-out agreement.)  The
intention is obviously to stop someone from spinning off his own
company to market an idea developed for the first employer.

Although the clause in question is a strong constraint, I don't see
that it would necessarily bind you to the company for life.  Think of
it as a three-year paid sabatical or other grant.  It has a built-in
disincentive for taking a job in any other field, but is a real
bonanza for someone who wants to spend time taking courses and
catching up on the literature in the AI field.

As a practical matter, I doubt that the employer would exercise his
option unless you intended to compete directly in the same product
you were working on.  It wouldn't make sense to buy you off if you
intended shifting to even a moderately different AI application.

                                        -- Ken Laws