The Threat Within: Protecting a dental practice from unfair competition by former employees: Part II

Proper steps protect your dental practice from unfair competition

Elkon Part 2

Part 1 of "The Threat Within" addressed the best preventive steps a dental practice should take to prepare for an employee’s departure when that employee seeks to compete with the practice. This article examines what steps to take right after an employee comes into a practice administrator’s office and says, “I’m leaving and I’m going to the practice three blocks away.”



Elkon Part 2

1. Demand the return of the practice’s property.

One way to demonstrate that a practice takes reasonable steps to protect its trade secrets is to show that it does not let its employees walk out the door with those secrets. A basic way to enforce this is to require that departing employees return all of the practice’s property. In light of the fact that employees now have the ability to work remotely, it pays to remind the employee that he or she needs to return electronic materials that reside on a smart phone, thumb drive, back-up hard drive, and personal e-mail account. A smartphone with a contact list of clients can be a trade secret customer list, as can a list of clients on Facebook or LinkedIn. Address these sources of information with the departing employee, and document the fact that the practice raised these issues.

2. Check e-mail folders and cell phone records.

In the grand scheme of things, it is penny wise and pound foolish to have an employee (especially a key employee) pay for his or her own cell phone plan. If a dental practice maintains its employees’ cell phone accounts, then it can a) terminate the account when an employee leaves so patients cannot reach out to them, b) determine who the employee has been contacting in his or her final weeks with the practice, and c) stop the employee from walking out with a customer list on his or her phone. If the practice has any concerns that a departing employee will pose a threat after the employment relationship ends, then a review of phone records may confirm or deny suspicions.

Likewise, it makes sense to review email folders. Employees often make the mistake of thinking that their work email addresses are theirs, as opposed to belonging to the practice. In other words, they rely on the name to the left of the @ as opposed to the name on the right. Thus they will make elementary, easily uncovered mistakes by sending incriminating emails (especially with attachments) to personal email accounts. It is often worth spending an hour or two scanning a departing employee’s sent folder to see if anything jumps out.

3. Preserve the hard drive.

While desktop and laptop computers are expensive, hard drives are not. The moment an employee resigns and says he or she is going to a competitor, pull the hard drive out of his or her computer and keep it in a drawer. Hard drives can be a treasure trove of information, revealing flash drive usage, data deletion, and use of incriminating software. However, the act of accessing files on a hard drive can alter the properties of those files. Therefore the best practice is to pull the hard drive and then consult with a forensic expert about having an image made before poking around in the drive.

It is rarely pleasant to deal with an employee leaving. That said, use of the best practices outlined in this article and Part 1 can keep an unpleasant situation from going from bad to worse.

Michael Elkon is an attorney with Fisher & Phillips LLP, one of the nation's leading labor and employment law firms representing employers.

READ Part 1 here.
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