BankUnited barred from appealing restrictive covenant ruling after missing filing deadline

The customer restrictions prohibited employees from contacting any BankUnited customer they had “received information” about during their last two years. BankUnited’s position meant this covered every name on a daily report listing over 4,500 customer entries, or about 1,200 distinct customer groups. The court balked. No employer has a legitimate interest in preventing a single employee from soliciting thousands of businesses, including many that employee never dealt with. 

The agreement also covered “prospective” customers and banned even “attempting to contact” customers, meaning an unanswered phone call could trigger a breach. 

The employee restrictions had similar problems. The agreement prohibited “encouraging” any BankUnited employee to leave for “any other entity or person,” not just competitors. Recent Delaware cases have found this kind of language unenforceable because it reaches beyond preventing unfair competition. 

BankUnited asked the court to fix the agreements by crossing out the problematic parts, a process called blue penciling. The court refused. The employees accepted their stock awards through an online Merrill Lynch portal, clicking through screens to get their equity without negotiating terms. They didn’t even know these restriction agreements existed until BankUnited sent cease-and-desist letters in late August. 

The facts leading up to the departures show employees trying to follow the rules. When Shulick started discussing opportunities with Customers Bank, executives told him repeatedly to check for legal restrictions and not to bring confidential information. The four employees hired their own lawyer and sent him the Code of Conduct, employee handbook, and stock award documents they could find. None showed enforceable non-solicitation restrictions.