The Impact of Non-Competes: Event Next Tuesday at Harvard

The Kennedy School's David Luberoff e-mailed today to let me know about an event coming up on Tuesday, April 21st, on "Using Non-Compete Laws to Spur Economic Development in Massachusetts." Judging from the description, the focus actually seems to be about "getting rid of non-compete laws as a way of spurring economic development."

State Rep. Will Brownsberger, who has introduced legislation to nix non-competes in Massachusetts, will be there, as will Lee Fleming and Matt Marx of the Harvard Business School, Bijan Sabet of Spark Capital, and Robert Fisher from Foley Hoag.

Here's the descrip:

Massachusetts, like many states, allows firms in knowledge-intensive fields to limit their employees' ability to take jobs with other firms. These "non-compete" restrictions help firms because they limit the disclosure of trade secrets, honor customer confidentiality, and prevent competitors from appropriating employees' specialized skills and knowledge. But new analyses based on a "natural experiment" in Michigan suggest that the restrictions should be reconsidered because they can stymie individual innovation, which in turn may hamper regional economic development.

Details here.

Foley blogs about non-compete law

My Globe colleague Todd Wallack just called this new blog to my attention: Massachusetts Noncompete Law, published by the law firm Foley Hoag LLP.

Here's blogger Michael Rosen's description of it:

Foley Hoag’s Massachusetts Noncompete Law Blog focuses on developments in Massachusetts in the areas of covenants not to compete, non-solicitation and non-disclosure agreements, trade secrets and the many related issues that arise when employees move between employers. As court decisions and other legal developments arise, this blog will describe them and discuss their implications for the businesses and individuals affected by them.

In several of the industries that are significant drivers of the Massachusetts economy—including high technology, life sciences and financial services—employers routinely require employees to sign various types of agreements restricting their activities during and after their employment. As a company’s intellectual property is placed at risk every time a valued employee walks out the door, the movement of talent between companies—particularly competitors—begets litigation. We hope to promote a working dialogue on these developments—post your thoughts and join the discussion.

(Unfortunately, the Alliance for Open Competition blog, run by a group of people who hope to change the way non-competes are enforced in Mass., seems to have gone dormant for half a year.)

Feinstein & Fleming: Dynamic Small-Cap Duo?

I've been curious about what blogger and former VC Michael Feinstein has been up to, ever since I bumped into him over the summer at one of the OpenCoffee Club gatherings in Central Square. Feinstein, formerly at Atlas Venture and Venrock, is also a regular presence at the Web Innovators Group.

At the last Web Innovators Group, Feinstein was wearing a stick-on name tag that linked him to Clear Stream Ventures, and when I asked him if that was the name of a new VC firm he was starting, he told me it was a placeholder.

Things got more interesting last week, when I ran into a VC who told me that Feinstein had been to a Deloitte-sponsored lunch, and talked a bit about what he was up to.

After trying for a time to put together an early-stage fund using the Clear Stream name, Michael has now linked up with Bob Fleming, founder of Prism Venture Partners. (Fleming left Prism as part of Woody Benson's extreme make-over of that Needham firm, now known as Prism VentureWorks.) Feinstein and Fleming are apparently now working together to raise a fund to invest in small-cap public companies, using some space at the Waltham office of Foley Hoag, a law firm.

"I will confirm that we are doing something oriented around small-cap public companies," Feinstein writes via e-mail, adding that he and Fleming won't have anything to announce officially until 2008.

Feinstein did acknowledge that he'd been working earlier to try to set up a seed-stage VC firm, but that he may have missed the right moment for that: "I was probably too late compared to some of the new funds in Boston -- .406, DACE, Kepha, etc."

This will be an interesting project to watch ... and I'm eager to find out more...