Business

Former manager with medical device firm may not work for rival firm, court rules

Creganna granted temporary injunction preventing Niall Cullen from taking up employment with competitor Lake Region Medical pending hearing

Mr Cullen, and Lake Region, which is also being sued, say the non-compete clause is void and unenforceable. Photograph: Bryan O'Brien

Wed Apr 24 2024 - 16:14

The High Court has granted an injunction preventing a former senior manager with a medical device component manufacturer from taking up employment with a rival firm pending the hearing of a dispute over whether his employment was governed by a non-compete clause.

Niall Cullen was product manager with Creganna Ltd, an Irish company based in Galway, before he was offered a senior position with competitor Lake Region Medical last January.

Creganna operates within the TE Medical business unit of a global business known as TE Connectivity which is in turn owned by Swiss company Tyco Electronics Group SA.

TE Connectivity is one of the top global companies in the medical device outsourcing industry, specialising in the design and manufacture of minimally invasive delivery and access devices for a range of medical therapies.

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Last January, Mr Cullen, who had been the senior product manager at Creganna with a key role in maintaining relationships with key decision-makers in a number of global customer companies, handed in his notice, which ends on April 29th.

Creganna learned he was taking up a senior position with Lake Region Medical, part of the Integer group. which is also a large global manufacturer of medical devices.

It brought High Court proceedings seeking to prevent him from taking up employment after April 29th because, Creganna said, he would be in a breach of a non-compete clause in his contract precluding him from employment with a competitor within 12 months of termination of his employment.

Creganna says that the non-compete clause was required to protect its legitimate interest in maintaining the confidentiality of its highly sensitive commercial information which it says will invariably be compromised if he took up the position in Lake Region Medical.

Mr Cullen, and Lake Region, which is also being sued, say the non-compete clause is void and unenforceable because it is unreasonable and too broad to be justifiable.

Mr Justice Oisín Quinn said he was satisfied Creganna had established there was a serious question to be tried that, if Mr Cullen takes up the new job, this will be an actionable breach of contract by being a breach of the non-compete clause in his contract of employment.

He was satisfied that Creganna has raised a serious question to be tried that the non-compete clause is valid.

He was also satisfied that, as Creganna was prepared to undertake to continue to pay Mr Cullen his salary until the conclusion of the trial of the action, which is now scheduled for next July, there was the least risk of injustice by preserving the status quo pending determination of the matter or further order.

The judge also rejected Mr Cullen’s claim that Creganna was guilty of delay in bringing its injunction application.

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