Clarifying Non-Compete Law in Virginia

In 2020, Virginia passed legislation creating prohibitory rules regarding noncompete agreements. This statute follows several other states which have created similar laws. In Virginia, employers cannot enforce noncompete agreements against low-wage employees. To fully understand and know what next steps to take for you or your business, let’s take a closer look.

This statute prohibits any agreement that “restrains, prohibits, or otherwise restricts an individual’s ability, following the termination of the individual’s employment, to compete with his former employer” (§ 40.1-28.7:8). This means there is potential to affect noncompete provisions in employment agreements, standalone restrictive covenants, and separation agreements. It does not prohibit confidentiality agreements and nondisclosure agreements.

What exactly is “low-wage”?

The term “low-wage employee” is a bit of a misnomer because it includes around half of VA employees. The statute defines low-wage employees as anyone who receives less than the average weekly wage per VA Employment Commission. This number will be updated quarterly and is subject to change but is currently approximately $59,124/year or $1,137/week. Low-wage employees also include “interns, students, apprentices, or trainees employed, with or without pay, at a trade or occupation in order to gain work or educational experience” (§ 40.1-28.7:8).

Another important aspect for employers is penalties for violation. A qualifying employee may sue an employer for violating or attempting to violate this law. The employee may receive “all appropriate relief” (§ 40.1-28.7:8) which may include:

  1. An injunction against the employer
  2. Liquidated damages
  3. Lost compensation
  4. Reasonable attorney’s fees and costs, including fees for expert witnesses

What employers can do:

Luckily, there are some measures that employers can take to avoid violation, provide a fair working environment, and still protect their professional interests. An easy first step is to post a copy or approved summary of the statute with other required employment notices. Employers must also take the time to review form non-compete agreements (and other restrictive covenants) to ensure compliance. Non-compete agreements for employees other than “low-wage employees” are enforceable if the employer can show that they are:

  1. Narrowly drafted to protect legitimate business interest
  2. Not unduly burdensome on the employee’s ability to earn a living
  3. Not against public policy

Due to other provisions of note not explored in this post, be sure to contact Gavin Law Offices for more information.  We continually monitor recent non-compete and trade secret legislation to better serve you and your business.

(This is not intended as legal advice. Contact a lawyer for assistance in your particular situation.)

 

U.S. Trademark Office to Increase Filing Fees for 2021

The United States Trademark Office recently announced that it will increase a number of its filing fees on January 2, 2021.  The increases apply to a wide variety of filings, including the fees for initial trademark applications.  We have included the most noteworthy increases below:

  • TEAS Standard Trademark Application: $350 per class
    Up from $275 per class
  • TEAS Plus Trademark Application (pre-approved goods and services): $250 per class
    Up from $225 per class
  • Section 8 (filed with both 8 & 15 and Renewal filings): $225 per class
    Up from $125 per class 
  • Petition to cancel/Notice of opposition filed through ESTTA: $600 per class
    Up from $400 per class
  • Initial 90-day extension requests for filing a notice of opposition, or second 60-day extension requests for filing a notice of opposition, filed through ESTTA: $200 per application
    Up from $100 per application
  • Petition to the Director filed through TEAS: $250
    Up from $100 

For the full list of fee increases, please visit: https://www.uspto.gov/trademark/laws-regulations/updated-trademark-ttab-fees-processes.

The U.S. Trademark Office will also implement a new fee for deleting goods, services, and/or classes from a registration after submitting a Section 8 declaration, but before the declaration is accepted, at a rate of $250 per class.

In light of the increased filing costs, Gavin Law Offices will work with clients who wish to take advantage of the lower filing fees to complete filings before the end of the year.  If you are considering a new trademark application or have maintenance filings due in the next year, we can help you complete such filings before January 2, 2021.  Please reach out as early as possible to ensure that we have enough time to get preclearance and/or the necessary documentation completed before the increase date.

  • – Rina Van Orden, Esq.

U.S. Data Privacy Law – 2020 Update 

By now, many of you have likely heard of the California Consumer Privacy Act (the “CCPA”).  The law, passed by California’s State Legislature in 2018, became effective on January 1, 2020.  The CCPA gives California residents more control over the personal information that businesses collect about themgranting residents the right to know how businesses use/share their personal information, the right to request that a business delete their collected personal information, and the right to opt-out of the sale of their personal information.  The CCPA borrows many of its provisions from the European Union’s General Data Protection Regulation (“GDPR”) While many believed that the GDPR (adopted by the EU in 2016) would serve as a catalyst for the United States to enact similar data privacy law, the U.S. has yet to pass, or even seriously consider, any comparably comprehensive data privacy legislation at the national level.  

While several other states have passed data privacy and protection laws since 2018, arguably none have enacted laws as extensive as the CCPA.  However, due to revisions California’s legislature made to the original text of the CCPA, as well as certain language included in the Final CCPA Regulations published by California’s Office of the Attorney General (OAG) earlier this year, many Californians and consumer advocacy groups do not believe the CCPA goes far enough to protect consumers’ personal information.  Thus, on election day this year, California voters approved ballot initiative “Proposition 24”  the California Privacy Rights Act of 2020 (the “CPRA”).  The CPRA gives additional rights to California residents and further limits businesses ability to use/sell/share personal informationamending and expanding upon the CCPA.   

Most of the CPRA’s substantive provisions will not become effective until January 1, 2023.  However, businesses may begin preparing for compliance with the CPRA by familiarizing themselves with the following highlights of the new law: 

  1. Applicability – Just because the CCPA was or was not applicable to your business does not mean the same for the CPRA.  For example, the CPRA will cover businesses that buy, sell, or share over 100,000 consumers personal information (up from 50,000 under the CCPA), reducing the applicability of the law to small and midsize businesses. 
  1. Enforcement – The CCPA is currently enforced by California’s Office of the Attorney General (OAG) However, the CPRA establishes the California Privacy Protection Agency, which will have investigative, enforcement, and rulemaking powers instead of the OAG.  The CPRA also removes the 30-day cure period businesses have under the CCPA and increases maximum penalties for violations concerning minors. 
  1. New category of “sensitive personal information – The CPRA will keep the existing categories of personal information defined in the CCPA, but will add a new category for “sensitive personal information.”  Californians will have increased rights when their sensitive personal information is involved.  
  1. Expanded contractual requirements – The CPRA limits the use of personal information by service providers and contractors and adds contractual requirements regarding relationships between businesses and such third parties.   
  1. Modifying/adding new consumer rights – New rights include the CPRA’s expansion of an individuals’ private right of action for certain types of data breaches and requires that covered businesses provide consumers with two or more methods for submitting requests to correct inaccurate personal information 
  1. Regulates “sharing” in addition to “selling” personal information, to include cross-context behavioral advertising – The CPRA expands upon the CCPA’s limitations on businesses “sale” of consumers’ personal information to cover the “sharing” of consumers’ personal information even if such information is not being sold for monetary value.  Specifically, this will regulate cross-context behavioral advertising,” defined by the CPRA as the targeting of advertising to a consumer based on the consumer’s personal information obtained from the consumer’s activity across businesses, distinctly branded websites, applications, or services, other than the business, distinctly-branded website, application, or service with which the consumer intentionally interacts.”  Businesses that share personal information, including in the cross-context behavioral advertising context, will need to provide an opt-out choice for consumers, such as “Do Not Sell/Do Not Share My Personal Information for Cross-Context Behavioral Advertising.”    

The above highlights, as well as the other provisions of the CPRA, bring California’s data privacy laws closer to resembling the GDPR.  It will be interesting to see whether other states follow suit in 2021.  While Virginia established a task force to study data privacy issues last General Assembly session, it has not yet passed any data privacy law as comprehensive as the CCPA/CPRA.  The Commonwealth, as well as numerous other states, will likely consider data privacy legislation next year. 

In the meantime, while the effective date of the CPRA may seem far away, California’s OAG continues to publish updates to the CCPA Regulations and to enforce existing law.  For example, while the Final Text of the CCPA Regulations was published in August, the OAG released fourth set of modifications to the Regulations on December 10, 2020.  The latest modifications include further clarifications on the CCPA, including much-awaited guidance on the “Do Not Sell My Personal Information ‘Button.’”  Thus, businesses still need to regularly review their CCPA compliance while they prepare for the CPRA.  You can find more information on the CCPA, including updates, here: https://www.oag.ca.gov/privacy/ccpa.  Gavin Law Offices will continue to track data privacy-related issues in California, Virginia, and across the U.S. and abroad, and are here to help you navigate this complex field of law.  

– Courtney Reigel, Esq.

Trademark Maintenance During Business Interruptions

During this unpredictable time, we have a few practical trademark maintenance tips that could save “future you” time and money. Foundationally, trademark rights are maintained via use of the mark in commerce. For federally registered marks, this use is evidenced in maintenance filings during the lifecycle of the trademark. However, use in commerce may be difficult, if not impossible, during pandemic-related shutdowns. Typically, periods of non-use of a mark can leave a trademark owner without evidence to support a registration’s maintenance filings and may also leave a trademark vulnerable to claims of cancellation or abandonment.

The good news is that the Lanham Act, the law governing federal trademark rights, has a built in safeguard that allows owners to avoid unnecessary and unwanted results in light of unforeseen events, like, for example, global pandemics…

In the event that you have a U.S. Trademark Office maintenance filing due in the coming months, our team is ready to assist you. Just as important, trademark owners that may not have maintenance filings due, but who experience interruptions in operations, should note the following for their records:

  1. The date that use of the mark stopped (or your “non-essential” business had to cease operations);
  2. The approximate date when you hope to resume use (or resume operations); and
  3. Documentation of the facts that lead to non-use (for example, an order from local or state government) and affirmation that you intend to use your trademark when those special circumstances are relieved. (37 C.F.R.§2.161)

We recognize that the health and safety of your family and community is your top priority during this difficult time. We will do our part to help you focus on what matters most by providing our expertise on the path forward for your business.

For further information regarding your trademarks, please feel free to contact us.

-Elizabeth Sewell, Esq.