
Contract Law: Noncompete Clauses - Data Management, Inc. v. Greene
Yale law professor Ian Ayres continues his American Contract Law course with a segment on formation defenses, focusing on illegality as a bar to enforcement. The case under examination is Data Management, Inc. v. Greene, involving a covenant not to compete. Ayres walks through the facts and reasoning courts use to decide when a noncompete clause is unenforceable as an illegal restraint on trade, situating the case within the broader doctrine of promissory liability and its exceptions. The lecture is drawn from Ayres' Coursera courses on American Contract Law I and II, part of a series covering contract formation, defenses, and remedies. Students get a concrete worked example of how illegality doctrine interacts with employment restrictions, useful for understanding how courts balance employer interests against employee mobility.