If you think you’d be better off leaving your job to start your own company that does the same thing as your employer, you’d better check the terms of your employment contract first. A swimming coach based in New Jersey, John Alaimo, worked for NYS Aquatics Inc. of Goshen, which has run the “New York Sharks” swim team since 2003. Although Alaimo renewed his contract with NYSA in the fall of 2019, less than a year later, in the summer of 2020, he started his own swimming company that likewise had a shark-themed name: Shark Swimming, LLC.
NYSA responded by suing Alaimo and two other swim coaches for breach of contract, citing both non-compete and non-solicitation clauses in their employment contracts.
A non-compete agreement states you cannot work for a competitor of your employer, usually within a certain geographic distance and a certain timeframe after your employment with them has ended. A non-solicitation agreement states you cannot solicit clients, vendors, or other employees of your employer to do business with your new employer. It’s also common to have a time limit on that requirement.
It’s unclear whether Alaimo’s non-compete and/or non-solicitation agreements were limited by time, but it doesn’t matter because Alaimo was still under contract with NYSA at the time that he founded his competing company.
According to the complaint, which was filed in Rockland County Supreme Court, in addition to starting a competing company while still under contract with NYSA, Alaimo also breached the non-solicitation clause of his employment contract by soliciting members of NYSA to work for Shark Swimming, LLC, and was contacting swim facilities with which NYSA has contracts for use of their pool time. The swimming pools in question include Spook Rock Pool in Suffern, as well as swimming pools in Felix Festa Middle School in West Nyack, and South Orangetown Middle School, RCC in Suffern.
The complaint further alleges that, at the time the lawsuit was filed in mid-January 2021, Alaimo had convinced at least 60 members of NYSA’s swim team to leave the NYSA and join Shark Swimming, LLC.
While Alaimo is the main defendant, the employment lawsuit also names two other defendants: Peter O’Donnell and Jeffrey Chen, both of whom are still under contract with NYSA as swim coaches. According to the lawsuit, both O’Donnell and Chen have allegedly worked with Shark Swimming, LLC to lure members of NYSA away from NYSA and towards Shark Swimming, LLC.
Edgar Perez, the president of NYSA, is seeking damages, attorneys’ fees, and a court order for Shark Swimming, LLC to cease operations immediately.
Given the fact that the name of Alaimo’s new company bears a striking resemblance to the name of his employer, one might expect NYSA to have included trademark infringement in their list of allegations, but that requires the case to fit very specific parameters in order for the plaintiff to be successful. While NYSA and Shark Swimming, LLC might not meet those specifications, it’s hard to believe it’s a coincidence that a swim coach for a team called the “New York Sharks” founded a competing swimming company with the word “Shark” in the name.
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When it comes to non-compete and other issues, we like to think Lubin Austermuehle is ahead of the competition all over the Chicagoland area, from Wheaton to Oak Brook to Naperville and beyond. A key component of our leadership position is the fact that we don’t just listen, we hear you, as you can find out in a FREE consultation. We’ll discuss your legal issues and needs and our ability to meet (and exceed) your expectations. Call 833-305-4933 or contact us via our website by clicking here. We look forward to speaking with you.