Asked by Dontae Perkins on May 23, 2024

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Which of the following is NOT a requirement in the enforceability of a noncompetition clause?

A) The noncompetition clause must serve a legitimate business purpose.
B) The noncompetition clause must be regarding the sale of goods.
C) The restriction on competition must be reasonable in time,geographic area,and scope.
D) The noncompetition clause should not impose an undue hardship.

Noncompetition Clause

A provision in a contract that prohibits one party from competing with another party for a certain period of time and within a certain geographic area.

Legitimate Business Purpose

A rational, honest intention or objective behind a business action or decision, often considered in legal contexts to validate transactions.

Geographic Area

A specific portion of the Earth's surface defined by natural or artificial boundaries, characterized by distinct physical, administrative, or cultural properties.

  • Identify issues regarding enforceability of noncompetition clauses in agreements.
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AR
Armani RiveraMay 26, 2024
Final Answer :
B
Explanation :
A noncompetition clause can be concerning the sale of goods as well as services.Therefore,courts will enforce a noncompetition clause if (1)it serves a legitimate business purpose; (2)the restriction on competition is reasonable in time,geographic area,and scope;and (3)it does not impose an undue hardship.