Where a parent corporation has moved for an order enforcing a non-competition provision against a defendant who previously worked for a subsidiary, the motion must be denied because the provision is not in compliance with the Massachusetts Noncompetition Agreement Act (MNAA).
“Timothy Brennan (Brennan) was employed by Anaplan Inc. (Anaplan) from March 2019 until he resigned on or about July 25, 2025 to work for Anaplan’s competitor, Pigment. Anaplan Parent, LP (Parent) is the parent — or grandparent — company of Anaplan (together Plaintiffs) with the power to manage, oversee, and control Anaplan. In connection with his employment by Anaplan, Brennan entered into three Executive Equity Grant Agreements (Equity Agreements) with Parent each of which contained a non-competition provision. In the instant Motion, Plaintiffs seek an order enforcing the non-competition agreement preventing Brennan from working for Pigment. …
“… At issue here is the requirement that the agreement be signed by both the employee and ‘employer.’ The precise issue is whether a parent or grandparent company of an employer entity is the employer for purposes of this statute. I conclude it is not. …
“In the face of the Commonwealth’s nearly cast iron rule of corporate separateness, if the Legislature had wanted to provide an employer’s parent company the ability to enter into and enforce non-competition agreements with and against its subsidiary’s employees, it would (and must) have done so explicitly. …
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