ARENCIBIA v. SILVERLINING INC (2025)

Order, Supreme Court, New York County (Andrew Borrok, J.), entered January 22, 2025, which, to the extent appealed from as limited by the briefs, denied defendant's motion for a declaratory judgment and to dismiss the complaint, and found that plaintiff is entitled to a declaration that a covenant not to compete provision in his employment agreement is unenforceable, unanimously affirmed, with costs.

Supreme Court properly held that the covenant not to compete is unenforceable (see generally BDO Seidman v. Hirshberg, 93 N.Y.2d 382, 388–389, 690 N.Y.S.2d 854, 712 N.E.2d 1220 [1999]).  The covenant would prohibit plaintiff from providing services for competitive businesses for three years, irrespective of any connection to serving defendant's customers.  This restriction is overly broad (see id. at 392, 690 N.Y.S.2d 854, 712 N.E.2d 1220;  see also Brown & Brown, Inc. v. Johnson, 25 N.Y.3d 364, 370–371, 12 N.Y.S.3d 606, 34 N.E.3d 357 [2015];  Crippen v. United Petroleum Feedstocks, 245 A.D.2d 152, 153, 666 N.Y.S.2d 156 [1st Dept. 1997];  cf.  Maltby v. Harlow Meyer Savage, 223 A.D.2d 516, 637 N.Y.S.2d 110 [1st Dept. 1996], lv dismissed 88 N.Y.2d 874, 645 N.Y.S.2d 448, 668 N.E.2d 419 [1996]).

We reject defendant's argument that because the employment agreement stated that severance payments “shall be subject to” receipt of a general release of liability to be negotiated by the parties, and plaintiff accepted severance payments, this action is barred.  It is undisputed that plaintiff received severance payments despite not executing such a release (cf.  Allen v. Riese Org., Inc., 106 A.D.3d 514, 516–517, 965 N.Y.S.2d 437 [1st Dept. 2013]), and there is no basis for defendant to enforce an otherwise unenforceable noncompete covenant.

We have considered defendant's remaining contentions and find them unavailing.

Motion to withdraw appeal denied.