Saturday, May 17, 2014

Mitchell v. Reynolds case brief summary

Mitchell v. Reynolds
(England 1711)
*According to Minda, this is the most famous commercial case that has ever been decided.
Facts: Plaintiff hired defendant as an apprentice baker. Defendant promised not to compete with plaintiff in the local parish for a period of time in return for training in the bakery business.
Issue: Did the non-compete agreement constitute a naked restraint of trade?
Holding: No. Court held that promise was necessary in order for the plaintiff to be motivated to hire individuals like defendant.
Reasoning: Court found that although there is a restraint of trade here, the non-compete agreement constituted an ancillary/incidental restraint necessary to accomplish a larger economic/legitimate purpose. Since the underlying purpose of the agreement was to train defendant, the restraint is said to be reasonable.
Rule of Law: Reasonableness is to be the test to determine the legality of a restraint of trade.
Case introduced the rule of reason analysis.

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