U.S. judge to Legal Sea Foods: noncompete agreement suit all wet: trade protection claims hold no water if recipes are in public domain

Nation's Restaurant News, Oct 13, 2003 by Milford Prewitt

During two months of back-and-forth legal correspondence between the two companies about Calise's alleged violation of the terms of his noncompete agreement, B.R. Guest considered moving him to one of its nonseafood restaurants. They decided to keep him at Blue Water Grill because the immediate need for a sous chef was "too great," officials said.

Legal Sea Food countered that its food safety program, while primarily derived from HACCP, a widely used program of Hazard Analysis and Citical Control Points, exceeds the requirements of the Food and Drug Administration and most local health departments when it comes to handling, butchering and cooking seafood.

But Judge Baer was unimpressed, stating there was nothing confidential about Legal Sea Foods' food safety program or its recipes He noted that all of Legal Sea Foods' kitchens have elaborate charts and posters--as well as training manuals and other materials--that inform employees who do not sign noncompete agreements how to handle seafood, what ingredients go into the recipes and how to cook them.

Baer said he thought his decision was the first by a federal bench to determine that there is nothing sacrosanct about protecting a restaurant's recipes from competitors. He added that given the high liability operators face in a litigious society over food allergies and food-borne illness, it was not uncommon for Legal Sea Foods servers--who do not sign confidentiality agreements--to tell guests the ingredients in certain dishes.

But more damaging, Baer stressed, was that Legal Sea Foods promoted its recipes in books, on the Internet, on television shows and at chef demonstrations.

"Restaurants like Legal Sea Foods cannot have it both ways," the judge wrote in his decision. "They cannot march their star chefs out on television shows, demonstrating their restaurant's signature "clam chowder" dish and list its recipe, publish it in newspapers nationwide, and then try and prevent its own chefs from ever using that recipe again.

"'It's too late,' says the law. It's in the public domain and not a trade secret."

Finally, citing previous lawsuits in both Massachusetts and New York, Baer said the courts long have favored the employee over the previous employer when it comes to threatening the livelihood of the employee, no matter what skills training or knowledge the worker took to a new company.

Heller, Legal Sea Food's corporate counsel, said that while it is true that the company publicly has distributed at large some of its recipes, he insisted that what the public sees is only a small part of what goes on in the kitchen. Many ingredients and cooking procedures are secret, and that is why the company will appeal, he said.

Meanwhile, Steve Hanson, president of B.R. Guest, said he tried to reach an out-of-court settlement with Legal Sea Foods and regretted that the matter went to court in the first place. He added that although Blue Water Grill serves seafood, there is little competitive similarity between the two concepts.