Question
Assume the following for the purposes of this exercise: The plaintiff is Boulder Dry (BD), a company located in Boulder, Georgia that develops online learning
Assume the following for the purposes of this exercise:
The plaintiff is Boulder Dry ("BD"), a company located in Boulder, Georgia that develops online learning platforms for use in universities, until recently focused on science and math courses. BD markets its products to colleges and universities throughout the United States. BD's clients use the online learning platforms for science and math laboratory assignments, and for science and math tutoring sessions offered by the universities.
The defendants are Online Textbook Educational Solutions, Inc. ("OTES"), and Alred E. Gone ("Gone"), the former Chief Financial Officer of BD, who presently serves as the Chief Executive Officer of OTES. OES is located in Rock City, Georgia. OTES is involved in the development of online applications for use in the elementary and high school classrooms in all educational areas. OES develops text-book related materials to assist students such as online presentations, quizzes, and learning activities. OTES targets its sales to publishers of textbooks, who then sell the materials to schools and textbook purchasers.
After two years with BD, Gone was terminated from his position at BD, and went to work for OTES, where he has worked for the past year. After Gone began to work for OTES, OTES was requested by its existing publisher clients to expand its online applications to college-level textbooks, including those in the math and science areas.
When OTES developed its first online application for university math courses, BD sued both OES and Gone. BD contends that Gone has breached his covenant not to compete, because he is engaging in a competitive business in online learning resources in university-level math and science and that he has proprietary information regarding the development of science and math tutorial programs. BD further contends that OTES is engaging in tortious interference with contract. BD is Gone and OTES deny the claims, and state that Gone has not violated his employment agreement, because they are not engaging in a competitive business with BD.
The law in Georgia was recently amended to include the following provisions: A covenant not to compete must be reasonable in terms of time, geographical area, and prohibited activities. A time period longer than 2 years is presumed to be unenforceable. The courts are permitted to blue-pencil (or reform) covenants that are otherwise unenforceable. O.C.G.A. sec. 13-8-56.
- Who should prevail (win) in the lawsuit? Is there a way to mediate this dispute that would benefit both parties? Be sure to justify your decision based on contract law.
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