In trade secret and noncompete cases, defendants are always looking for new and different ways to defend their actions. One defense that is sometimes raised, but rarely leads to substantive rulings, is selective enforcement. In a trade secrets case, a defendant may argue that the trade secret owner’s failure to pursue legal action against others who may have used or disclosed (or even had the opportunity to use or disclose) the trade secrets demonstrates that the owner (often a former employer) has not made reasonable efforts to maintain the secrecy of the information. In a noncompete case, a defendant may argue that if a former employer fails to seek enforcement of the noncompete against other departed employees, that shows the former employer does not have a legitimate business interest in enforcement against that defendant.
A recent decision from a federal court in Kansas is a good reminder that a pattern of non-enforcement can have serious consequences in a trade secrets case. In Edelman Financial Engines, LLC v. Mariner Wealth Advisors, 2:23-CV-02515-HLT, 2026 WL 1618502, at *9 (D. Kan. June 5, 2026), the district court granted summary judgment to a defendant on a federal Defend Trade Secrets Act (DTSA) claim, identifying the plaintiff’s selective enforcement as one basis for its determination.
Among multiple reasons for granting summary judgment to the defendant, the district court cited the plaintiff’s inconsistency in protecting its information. Id. Although the plaintiff had approximately 74 former employees who breached their agreements beyond those at issue in the case, it pursued only 42 of them. Additionally, it did not seek relief against eight of the ten former employees named in the case itself. Id. The court treated that track record as evidence that the plaintiff failed to take “reasonable measures” to protect its alleged trade secrets, a required element of any DTSA claim. As such, the court found this behavior “suggest[ed] that the information at issue [did] not constitute a trade secret at all.” Id.
While there may be a variety of reasons why a former employer does not file suit against every departed employee who may be able to use or disclose trade secrets, including the considerable cost of doing so, this case demonstrates a potential risk the employer takes by not doing so.
Even if selective enforcement is not ultimately dispositive, it is a fertile area for defendants to explore in discovery. For example, in Randstad General Partner (US), LLC v. Bestreich, 1:19-CV-01655-MHC, 2021 WL 3054685, at *1 (N.D. Ga. Jan. 28, 2021), the defendants obtained an order requiring the plaintiff to produce a corporate representative to testify about its history of enforcing, and not enforcing, its agreements with departing employees. In that case, the district court denied the plaintiff’s motion for a protective order, finding that the selective enforcement defense had not been rejected by any Georgia court and that even if the defense were later rejected on the merits, that result would have “no bearing on the relevancy of the information sought by Defendants during discovery.” Id. In its order, the district court cited Health Mgmt. Assocs., Inc. v. Salyer, No. 14-14337-CIV-ROSENBERG/LYNCH, 2015 WL 13776250, at *1 (S.D. Fla. Aug. 19, 2015) (“The legal viability of Defendant’s defenses is not before this Court…. What is before this Court is a discovery dispute, and discovery applies a broad definition of relevance. For instant purposes, the Court finds no legal bar that precludes the Defendant from seeking discovery related to how the Plaintiff enforces restrictive covenants generally.”).
Selective enforcement has even surfaced as an issue regarding the ultimate enforceability of restrictive covenants themselves. Examples of this include:
- Surgidev Corp. v. Eye Tech., Inc., 648 F. Supp. 661, 686 (D. Minn. 1986) – Refusing to enforce covenants not to compete against four former officers where 28 other employees had been permitted to move to competitors over the years and the former employer had similarly engaged in hiring employees from competitors.
- Estee Lauder Cos. Inc. v. Batra, 430 F. Supp. 2d 158, 181 (S.D.N.Y. 2006) – Finding that a former employer’s behavior surrounding the enforcement of restrictive covenants suggested that the 12-month post-termination restriction of a high-level executive was unnecessary, as other executives’ agreements had been narrowed from six months to three to five months.
- Gateway 2000, Inc. v. Kelley, 9 F. Supp. 2d 795 (E.D. Mich. 1998) – Finding that a former agreement containing a general restriction on working for competitors was overly broad, where a newer agreement only listed restrictions for specific competitors);
- Gagliardi Bros., Inc. v. Caputo, 538 F. Supp. 525 (E.D. Pa. 1982) – Finding that a one-year noncompete was likely not necessary, where a former employer had not required employees to sign employment agreements in the last five years, despite the business growing significantly during that time.
Employers invest significant resources in drafting and negotiating restrictive covenant agreements and protecting their confidential information and trade secrets. They require employees to sign non-solicitation, non-competition, and confidentiality provisions. Many companies, however, have a less-than-perfect enforcement record. When it comes time to actually enforce those agreements or protect their secrets, some employers pick and choose, pursuing legal action against some former employees while quietly allowing others to breach their covenants without consequence. As both Edelman and Randstad illustrate, a pattern of non-enforcement is not just a background fact in litigation, but potential evidence that a defendant may rely on to argue that the employer did not treat its agreements or its information as worth protecting.
BFV’s Noncompete/Trade Secrets team is monitoring noncompete developments nationwide and will continue to provide updates as they emerge. If you have questions about how your business uses noncompetes, we are available to assist you.
BFV summer associate Yunseo Ki, a student at Emory University School of Law, contributed to this post.
Benjamin Fink is known for his work in noncompete, trade secret and competition-related disputes. A shareholder at Berman Fink Van Horn, Ben concentrates his practice in business and employment litigation.