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The petition presents two questions for the Court:  (1) whether the lower court violated Grant’s 5th Amendment right to due process when it refused to allow testimony that Grant knowingly handed over the notes, showing a consciousness of innocence; (2) whether a defendant should be held to a more demanding standard when presenting evidence of a consciousness of innocence (as opposed to evidence of consciousness of guilt presented by the prosecution).  According to Grant, the prosecution deliberately mislead the jury by arguing that his “claim of intentional production was made up and without factual support, despite knowledge that Mr. Grant had sought to prove that very fact with testimony that has been excluded on the prosecutor’s objection.”

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In the case, Deltek, Inc. v. Iuvo Systems, Inc., the Court applied a balancing test.  The Court acknowledged Deltek’s legitimate interests in preventing former employees from competing with its proprietary services through the use of Deltek’s confidential and proprietary information as well as the employees’ Deltek funded training and expertise.  However, the Court found that the agreements were too broad and held that Deltek’s interests were eclipsed by the employees’ interests and public policy.  In deciding, the Court took an unusual approach of comparing the agreements of two employees which extended one and two years.  The Court drew a negative inference and found the existence of a one year agreement to suggest “that Deltek itself recognizes that a two year restriction is longer than its legitimate interests require.”

Employers have a legitimate interest in protecting their proprietary information and investment in their labor force.  This interest must be balanced with the public’s interest in promoting gainful employment and economic growth.  Anyone asked to sign a non-compete agreement should give it careful consideration and realize the potential for long-term consequences.

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Sen. Lincoln reasons that the proposed legislation will serve as a windfall to the insurance industry and therefore the deduction for executive compensation should be reduced to ensure that revenue stays within the company to lower premiums.  For the reduction to apply to an insurer, the company must receive 25% of its gross premium income from plans that meet the minimum creditable coverage requirements in the proposed Act.

However, there is still ambiguity because the definition of minimum creditable coverage as defined by the Act does not apply to individual, small group and other group private health insurance.  That is left to each state’s insurance commission.

This amendment is consistent with last year’s amendments to IRC § 162(m)(5) which lowered the tax deduction of executives of companies receiving T.A.R.P. monies from $1 million to $500,000.  Perhaps we are seeing the start of a new trend.

For information on The Employment Law Group® law firm’s Executive Compensation practice, click here.

For more information on executive compensation, visit The Employment Law Group® law firm’s Executive Counsel Practice at http://www.employmentlawgroup.net/PracticeAreas/Executive-Compensation.asp.

The massive award of $4.1 billion in this case is significant because it highlights the fact that employers can face severe penalties for failing to satisfy contractual obligations owed to employees.  The Employment Law Group® law firm has successfully represented and advised senior executives in employment-related contract disputes including breach of stock option agreements and compensation agreements.  For more information about the firm’s Executive Counsel Practice, click here.