A Delaware court has dismissed a breach of contract case involving restrictive covenants against Travis Webb, a former executive in the roofing industry. The ruling affects several companies under FirstService Roofing Holdings, Inc. and highlights the enforceability of non-compete agreements in business acquisitions.
The case, FirstService Roofing Holdings, Inc. v. Travis Webb, was filed under docket number N25C-09-183 PAW CCLD. The court ruled on September 25, 2026, after Webb's motion to dismiss the case was granted. This decision is significant as it addresses the limitations of restrictive covenants in employment agreements and their enforceability under Delaware law.
Background
The plaintiffs in this case include FirstService Roofing Holdings, Inc., FirstService CAM Holdings, Inc., FirstService Roofing Acquireco, Inc., Roofing Holdco, LLC, and Roofing Buyer, LLC, collectively referred to as FirstService. They allege that Travis Webb, who co-founded a roofing services company called Exterior Solutions of Georgia, Inc., breached several restrictive covenants after he was acquired by Roofing Buyer in 2021.
Webb had agreed to certain non-competition and non-solicitation clauses as part of his employment and acquisition agreements. However, after leaving the company in April 2024, he allegedly began soliciting employees and customers for a competing business, Atacama Roofing, LLC. The plaintiffs filed the complaint in May 2025, claiming damages for Webb's actions.
The Ruling
The court ruled in favor of Webb, stating that the restrictive covenants in both the Restrictive Covenant Agreement and the Shareholders’ Agreement were unenforceable. The judge, Patricia A. Winston, noted that the provisions were overly broad in geographic and temporal scope, exceeding the legitimate business interests of the plaintiffs. In the opinion, the court stated, "The nationwide scope of the non-competition and non-solicitation provisions in the Restrictive Covenant Agreement and Shareholders’ Agreement exceed Plaintiffs’ legitimate business interests."
Furthermore, the court found that the plaintiffs failed to adequately plead facts supporting their claims of solicitation of customers or employees. As a result, the court dismissed all counts in the complaint, concluding that the restrictive covenants could not be enforced as drafted.
Impact
This ruling has significant implications for businesses in Delaware and beyond. It underscores the importance of carefully drafting restrictive covenants to ensure they are reasonable and enforceable. The court's decision indicates that overly broad non-compete agreements may not hold up in court, particularly if they extend beyond the legitimate interests of the business.
Companies must now consider the geographic and temporal limitations of such agreements when drafting employment contracts. The ruling may also influence how businesses approach acquisitions and employee agreements in the future, as they seek to protect their interests without overstepping legal boundaries.
What's Next
As of now, there is no indication that the plaintiffs will appeal the decision. However, the case sets a precedent for future disputes involving restrictive covenants in Delaware. The ruling also raises questions about the enforceability of similar agreements in other jurisdictions, potentially prompting further legal scrutiny of non-compete clauses in employment contracts.