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Demand Letter from a Former Employer

Demand Letter from a Former Employer

Demand Letter from a Former Employer

Several of us resigned from our former employer (hereinafter very large company or VLC)last week. We obtained legal advice prior to leaving and feel that we did everything by the book (took nothing with us, didn't solicit clients prior to leaving, used no insider knowledge of VLC's business practices in our dealings with clients - all of whom approached us once we opened and let them know we had left VLC and were now open for business).

We received the following missive from VLC last night (I believe the timing was selected for maximum intimidation purposes, Friday at 7:30 PM):

Mr. Former Employee
Your Home Address
Your City State and Zip code

Via Email to Your E-mail

Subject: Notice of Improper Actions

Dear Mr. Employee:

This letter is to put you on notice that Very Large Company (VLC) has received information that indicates that you and/or your firm, Our New Firm Inc., acting alone or in concert with others, have engaged in tortiuous (sic) interference with business relationships of VLC, participated in unfair and deceptive trade practices, used confidential and proprietary (sic) of VLC, and breached duties (sic) while an VLC employee. Such claims are supported by conduct (sic) prior to your resignation from VLC and continuing attempts to divert business away from VLC to your venture.

You are demanded to immediately cease and desist from such improper activities. VLC continues to gather further evidence on these matters, and now that you are notice (sic) of VLC' claims, any further conduct in this regard will subject you to additional damage claims, including punitive damages. VLC will assert all rights and actions deemed necessary to protect VLC's interests, proprietary and confidential information, as well as to protect our client relationships and employees.

You are so notified.


VLC, Inc.

VLC Employee
VLC's Head Attorney


Manager 1, Executive Vice President
Manger 2, Executive Vice President

Should we be concerned?

Replies continue below

Recommended for you

RE: Demand Letter from a Former Employer

Unless you signed a non-compete agreement I wouldn't worry about it, assuming you did none of the items claimed.

Your attorney will be pleased to send a measured and pointed response!

Their actions could be construed to be exactly what they have claimed against you...unfair and deceptive trade practices, by trying to intimidate you into not pursuing clients.

Good luck.

RE: Demand Letter from a Former Employer

As far as one-word replies are concerned, I'm torn between "meh" and "feh".  Your attorney can translate into a full page of legalese.

RE: Demand Letter from a Former Employer

I like The Tick's response.  I also like 'whatEVER' and 'LOL'.

I have direct experience with this situation in the State of Illinois as, but it's about the same all over the US.  In this case I was in the VLC's position.  My company had non-competes and when 2 partners left, taking with them two employees, 3 clients and 12 projects UNDER CONTRACT, and opened their office 6 floors above us IN THE SAME BUILDING, we thought, 'slam dunk.  They're cooked."

Nope.  Judge threw the book at ME and the one remaining principal.  He said non-competes are unenforceable, employees are 'at will' and so are the clients, even if you have a signed contract. with a cancellation provision.  The clients did not have to pay the contract cancellation fee, and my company had to pay the ex-partner's legal fees (which we got out of on appeal.)

So my recommendation,

1.  Put the best corporate litigator in your area on retainer so that VLC can't use them.

2.  Write a letter back saying something like,

Dear Moe, Larry and Curly,

We here at Our New Firm suggest that you consider consultation with outside counsel about this matter.   You will need an experienced corporate litigator, and not some in-house lackey to steer you in the right direction.  Have your outside attorney clue you in on the odds of the case going your way.  BTW, when you find a good lawyer, he can contact ours at......

Your very unafraid ex-eployees

3.  Have your corporate litigator write the standard notice of representation and send it to VLC.

And be prepared to use a lot of your start up capital fighting this if VLC decides to terrorize you financially because they outgun you on disposable income.  But maybe they will decide differently.

"Gorgeous hair is the best revenge."  Ivana Trump

RE: Demand Letter from a Former Employer

This part might be a problem:
>>>all of whom approached us once we opened and let them know we had left VLC and were now open for business)<<<

If you let _just_ those clients know you were in business, then there is a strong suggestion that you took a 'client list' from VLC.

If you let _everybody_ you ever heard of know that you were in business, that would be a more defensible position.


Mike Halloran
Pembroke Pines, FL, USA

RE: Demand Letter from a Former Employer

My wife used to be a receptionist at a law firm and I got to know several of the lawyers very well.  Over drinks one night, one of the lawyers was giggly and we asked him why?  He described a situation much like the OP described and said that writing the response just made his week.  In 500 words or more (why are lawyers so wordy on paper?) he explained that the "evidence" had better be very good because if they brought suit he was going to "evaluate avenues by which a substantial counter suit could be brought".  He said that his VLC caved like a "souffle at a rock concert".

I don't know the details, I just know that many lawyers love to defend this sort of suit.

David Simpson, PE
MuleShoe Engineering
Please see FAQ731-376: Eng-Tips.com Forum Policies for tips on how to make the best use of Eng-Tips Fora.

"It is always a poor idea to ask your Bridge Club for medical advice or a collection of geek engineers for legal advice"

RE: Demand Letter from a Former Employer

I agree with Mike H here.  

I feel that you have left yourselves open for a lawsuit by having the initial contact with the clients after you left.  Had they made the contact, no worries.  However, such does not appear to be the case.

That being said, I will have to defer to your lawyer.  Would have been best if you didn't have to go to a lawyer, or had consulted one PRIOR to leaving the company.


Mike McCann
MMC Engineering
Motto:  KISS
Motivation:  Don't ask

RE: Demand Letter from a Former Employer

You may be right and ethically OK, but only the lawyers will win.  

But since you have to fight it, you might as well kick their #@# for such a threatening letter.

RE: Demand Letter from a Former Employer

I have a friend that is involved with a lot of EEOC litigation for a large telecommunications company.  His take is that there is no such thing as law.  Each district, each judge, basically just wings it.

RE: Demand Letter from a Former Employer

I'm not sure why people are saying 'you're going to have to fight it' as so far no action has been taken. It's just empty words. Bin it and carry on.


RE: Demand Letter from a Former Employer

Yes, because ignoring problems until you're being slapped with a lawsuit has always worked in the past...

Dan - Owner

RE: Demand Letter from a Former Employer

My response would be simple:  "prove it".

Until then it's a threatening letter.  Never got one of those before?!

RE: Demand Letter from a Former Employer

Well I've got an opposite story to share, from my wife's previous firm.  (general contractor, hereafter GC1)

VP leaves, takes two people with him, joins another firm (hereafter GC2).

GC1 loses a couple of bids to the VP's department at GC2.  These were not jobs under contract, but GC2 did come in suspiciously lower than the GC did to win the work.

GC1 grabs the VP's old computer, as well as the two people he took with him, turns it over to some computer gurus, and they are able to find out from the computer that the VP downloaded whole stacks of proprietary information from GC1's server before he left, stuff like estimating spreadsheets, client lists, and what those couple of bids were going to come in at.  Furthermore, he had one of the girls who left to go with him doing the same thing on company time, after he left but before she left.  They find all this out by looking at file transfer mumbo jumbo on their work computers.  Ghost images of deleted files / etc.

GC1 lays a lawsuit on GC2, and is able to seize GC2's computer systems to have a looksee at what's there, and whether any intellectual property has been stolen.  Things get nasty from there.  Eventually VP gets laid off from GC2 during the crash, and is working for someone else.  I think GC1 and GC2 settled out of court.

Moral of this story is .. all those spreadsheets and letterheads and contracts and every little widget you've used with your previous company is intellectual property, and if you have any of it at home on a disk anywhere, particularly on any computer you're using for your current job, delete it, format it, burn it, bury it in your back yard, and rebuild all your spreadsheets/etc from scratch, because that's something they can get you for if their lawyers are good enough, and if their lawyers helped write their corporate IT policy.


Hydrology, Drainage Analysis, Flood Studies, and Complex Stormwater Litigation for Atlanta and the South East - http://www.campbellcivil.com

RE: Demand Letter from a Former Employer

Just went through the same thing and yes you should be concerned and respond.  With or without a non-compete you will not lose any battle in court.  As stated on other posts above you have the right to compete in the market place.  You will want to respond and respond with authority.  Look at your state statutes and there will be a paragraph about 'attempting to harm the reputation" or "ability of employment" of another licensee in your state.  

 Their goal is not to win a legal case against you, because they can't and they know it, but they will try to tie you up defending this, tie up your funds in lawyers and scare any client's away thinking they won't want to be in the middle of a battle between two firms.  They are probably thinking that if we can't have them neither can they.

Big firms love doing this when people leave, so respond, hit back, threaten big and keep going.  If they keep sending letters report them to the State Board, that is a quick way to slow them down.

Good Luck

RE: Demand Letter from a Former Employer

Can you let us know how it all turned out?

RE: Demand Letter from a Former Employer

Well, as they say, it's a matter of litigation so I can't get into the nitty gritty. But so far, VLC has stepped on its collective genetalia several times and is probably ruing the day that they decided to sue us rather than send us a "best wishes in your new endeavor" letter. They sent us a check for several 10s of thousands of dollars last week, for example, and in the future, whenever you google the company's head attorney's name you'll find that he was censored and disqualified from the case in a manner that sets a precedent likely to be cited in many future cases. He'll also spend the next year explaining himself to various bar associations if there's any justice in life.

The lesson is that, yeah, big companies like to use the legal system to mess with small companies, but the legal system doesn't appreciate being used in that manner.

RE: Demand Letter from a Former Employer

I thought that was the whole purpose of the legal system.

RE: Demand Letter from a Former Employer

The purpose of the legal system is to provide employment for lawyers.

Peter Stockhausen
Senior Design Analyst (Checker)
Infotech Aerospace Services

RE: Demand Letter from a Former Employer

Post *your* lawyer's name.  Sounds like he might be worth hiring.  :)

Hydrology, Drainage Analysis, Flood Studies, and Complex Stormwater Litigation for Atlanta and the South East - http://www.campbellcivil.com

RE: Demand Letter from a Former Employer

Good for you!  It's nice to hear that the legal system can actually support justice, even if the other guy has a ton of money.

Good luck to you and your company!

RE: Demand Letter from a Former Employer

Thanks howardoark for telling us how this worked out.  Sounds like real justice prevailed in this case!

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