Twelve Month Post-Termination Non-Solicitation Restriction Too Long to be Enforceable

In Associated Foreign Exchange Ltd v International Foreign Exchange (UK) Ltd and another [2010] EWHC (Ch) 1178, the High Court held that there was insufficient evidence to show that a restriction of 12 months (less time spent on garden leave) went no further than was reasonably necessary to protect the legitimate business interests of the employer. It therefore refused to grant an interim injunction to restrain a former employee from breaching the covenant and soliciting its customers.

Mr Abbassi was an account executive at Associated Foreign Exchange Ltd, a company in close competition with International Foreign Exchange (UK) Ltd. Mr Abbassi spent 3 months on garden leave and then moved to a similar role at International Foreign Exchange (UK) Ltd. Associated Foreign Exchange Ltd sought injunctive relief against both Mr Abbassi and IFX to prevent solicitation of its customers and potential customers for nine months from Mr Abbassi's last day of employment, taking into account the three months he had spent on garden leave.

It was held that the speed at which changes occurred in the market in which Mr Abbassi had been employed made a 12 month period of protection unnecessary. Foreign currency exchange customers as a group were not particularly loyal and Mr Abbassi was not particularly senior, nor did he play a key part in bringing new business to his employer. It was therefore likely that at trial the covenant would be held to be unenforceable.