Sonic the Hedgehog, Dr. Robotnik, and a Non-Compete Clause
If you’ve ever played video games then you’ve probably at least heard of Sonic the Hedgehog. You may even know about Dr. Robotnik and his singular focus of destroying Sonic. But have you ever laid awake at night wondering: why? What did poor, adorable, and for some reason blue, Sonic ever do to deserve such hatred? The truth is, I don’t know the real reason and I’m sure there’s someone out there who does. But, for the purpose of this article, I’d like to think the culprit is a non-compete agreement that Sonic unabashedly violates.
WHERE’S THE BEEF?
That’s right. Sonic the Hedgehog used to be employed by Dr. Robotnik before discovering his sinister activities. So, Sonic set out to foil Dr. Robotnik’s evil plans. He’s a hero! He’s also an oblivious fool who is clueless about the employment agreement he signed, which is chock full of restrictive provisions and non-compete clauses. Therein lies the problem. Sure, Dr. Robotnik is angry that his nefarious activities are being thwarted by a hedgehog, but he’s a man who values a written agreement and he’s unforgiving when someone breaks a contract. He’s a complex character! Unhinged and honorable? Regardless, there’s a bigger question: is the non-compete portion of the agreement even enforceable? Cool your jets, Dr. R. Let’s clear it up before you disintegrate Sonic and Tails!
WHERE’S THE LAW?
The law governing non-competes varies from state to state, and is almost entirely unenforceable in some. Iowa, for example, completely prohibits restraint on competition. The states that allow some restrictions use factors in determining the enforceability of these provisions, like geographic scope of the restraint, the extent of the restriction, and how long it will last.
Based on the beautiful and varied landscape of Sonic’s world, and because it’s highly convenient, let’s say he is based in California. California essentially prohibits the use of non-compete provisions in employment relationships, with some exceptions. The law tells us that, unless it is otherwise provided for in the statute, every contract by which anyone is restrained from engaging in a lawful profession, trade, or business of any kind is to that extent void (California Business & Professions Code Section 16600).
The exceptions to this rule really only apply to people who have some ownership in the business. The exceptions may apply when the person is selling the goodwill of a business, either all or a portion of their ownership interest in the business, or the assets of the business, so long as the buyer carries on a like business. The exception doesn’t apply, for example, to the business’s administrative assistant with absolutely no ownership stake in any part of the business. Also, a partner who is part of a partnership may agree not to compete in a specific geographic area where the partnership transacted business so long as any other member carries on a like business. A similar exception is carved out for limited liability companies as well. You can read the statutes, found in California Business & Professions Code Sections 16601, 16602, and 16602.5, to learn more about the instances in which a non-compete clause may be allowed.
WHERE’S THE…ANIMAL SHELTER?
Now that I got all of the statutory language (i.e., less flashy stuff) out of the way, we can turn our attention back to the rivalry between Sonic and Dr. Robotnik. First, we have to establish whether Sonic was just an employee or if he owned any part of Dr. R’s business. If our favorite blue hedgehog was just an employee, then this analysis is over pretty quickly. Dr. R’s non-compete is unenforceable and Sonic can continue his heroic activities unimpeded! Okay, article over.
But wait! You know you want to know what happens if Sonic was an owner. At the very least, you want to keep reading to find out what Dr. Robotnik’s business entails. Dr. Robotnik’s business helped homeless animals find shelter. But, Sonic didn’t know that those very shelters belonged to Dr. Robotnik. Imagine his surprise when he discovered what Dr. Robotnik was doing to the animals after “helping” them…I don’t want to say in case PETA is listening. So, Sonic leaves the company and sets out to actually aid these animals, all the while freeing the poor souls that are already captured by Dr. Robotnik (and turned into robots).
If Sonic owned part of Dr. R’s business, then he may be in some hot water. Dare I say hedgehog soup may be brewing? I bet Dr. Robotnik would like that. The non-compete should be limited to a specified geographic area, which means Sonic can continue his endeavors outside that area. It’s not like Sonic can be banned from Spring Hill and Aqua Lake. That’s just ridiculous! But, as many of you know, everywhere Sonic goes Dr. Robotnik follows. Stalks, even. Without venturing into harassment laws, we can make the argument that Dr. Robotnik can only limit Sonic’s activities in one geographic area. How big can the area be? Well, we’d have to delve into case law to make that determination, but one thing is certain: it can’t be the entire country.
Geographic scope isn’t enough, of course. Dr. Robotnik must also be carrying on a like business. He’s continuing his shelter-location business, so Sonic would have to cease helping the animals find shelter in the specific geographic area. If Dr. Robotnik stopped his legitimate business, then Sonic would have free reign!
WHERE’S THE LOVE?
Will these two ever get along? Assuming the agreement not to compete was limited to a specific geographic region—say, Spring Hill—and Dr. Robotnik is still carrying on the business of finding animals shelter, then Sonic has to leave that area to Dr. Robotnik. But, Dr. Robotnik needs to respect Sonic’s boundaries and leave him alone in all other geographic areas. Once each fulfills their respective responsibilities, the two may actually find the love again…okay, maybe not.
Disclaimer: Nothing in this article is, nor is it intended to be, legal advice. Please consult with an attorney for your individual situation.
Photograph Courtesy of FreeDigitalPhotos.Net