Yesterday, I wrote that NBC’s dispute with Conan O’Brien might turn on an interpretation of his employment contract. If NBC’s actions were in breach of its agreement, any restrictive covenant preventing Conan from moving to Fox would likely be unenforceable.
Since that post, several commentators have opined that any such restrictive covenant would be unenforceable under either New York or California law-both states have passed statutes prohibiting restrictive covenants in employment contracts.
NBC’s legal position would probably be much stronger if it had included both “choice-of-law” and “choice-of-forum” provisions requiring that Delaware law be used to interpret the agreement and that Delaware courts interpret the agreement. Teresa Cheek’s recent post on this topic details the real advantages of using Delaware law in employment contracts involving executives or key employees.
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