Supreme Court Upholds Federal Right of Arbitration of Confidentiality and Noncompetition Agreement

In Nitro-Lift Technologies, L.L.C. v. Lee, the Supreme Court of the United States reversed the decision of the Oklahoma Supreme Court and upheld the right of an employer to bring its claim directly to an arbitrator and not be subject to a challenge to its right to arbitration in state court. The U.S. Supreme Court decision is based on the clear principles of the Federal Arbitration Act, an almost 90 year old statute that creates a federal right to arbitration.

Our advice is not always to include an arbitration clause in our intellectual property and Founders’ Agreements, but we use the case decided today to highlight the power of such alternative dispute procedures.