A recent North Carolina Business Court decision is a useful reminder for employers: the forum, choice-of-law, and contract-formation language in employment-related agreements can bind the company just as much as it binds the employee.
Case Overview
In IQVIA Holdings Inc. v. Panagos, 2026 NCBC 81, the North Carolina Business Court dismissed a lawsuit filed by IQVIA Holdings Inc. and IQVIA RDS, Inc. against four former senior employees and their new employer, Syneos Health, Inc., for improper venue. IQVIA alleged that the former employees breached confidentiality, noncompetition, nonsolicitation, and related restrictions after joining Syneos, and that Syneos induced those breaches as part of an unfair-competition campaign. The unusual twist was that IQVIA, the employer, asked a North Carolina court not to enforce the Delaware forum and formation language in IQVIA’s own standard Confidentiality and Restrictive Covenants Agreements. The court enforced the agreements as written, held that the dispute belonged in Delaware, dismissed the amended complaint without prejudice to refiling in an appropriate venue, and denied IQVIA’s preliminary-injunction motion as moot.
Relevant Issues for Employers:
Contract formation
- The agreements stated that they were deemed made and entered into in Delaware. The court treated that language as part of the parties’ bargain, not as disposable boilerplate.
- IQVIA alleged that the agreements were entered into in North Carolina, but the court held that the contract language controlled over contrary allegations.
- The court recognized that parties may use a place-of-formation clause to reduce uncertainty, especially where employees, corporate affiliates, and contracting processes span multiple states.
Forum selection clauses
- The agreements required any legal action “with respect to” or “which impacts” the employee’s obligations to be brought exclusively in the federal or state courts in New Castle County, Delaware.
- Although the clause began with “I further agree,” the court read it as universal, reciprocal, and mandatory because it applied to “any legal action” and used affirmative language saying such actions “shall be brought” exclusively in Delaware.
- North Carolina’s statute disfavoring out-of-state forum provisions for contracts entered into in North Carolina did not save IQVIA because the agreements said they were made in Delaware.
Waiver
- The court rejected IQVIA’s waiver argument. Requesting assignment to the Business Court did not waive a venue objection because Business Court designation does not determine venue.
- The defendants timely preserved their venue objection by moving to dismiss for improper venue.
Risks for Employers
- A forum clause drafted for perceived employer advantage may prevent the employer from suing in its preferred court when it needs fast relief.
- Language intended to be employee-facing may still bind the employer if the clause is written broadly or in passive voice.
- A place-of-formation clause can affect whether North Carolina’s forum-selection statute applies, so employers should not include “deemed made in” language casually.
- Related claims against a competitor, including tortious interference and unfair-or-deceptive-trade-practices claims, may be swept into the same forum clause if they depend on the restrictive covenant agreement.
- Inconsistent forum language across offer letters, equity award agreements, arbitration agreements, non-competes, nondisclosure agreements, and incentive-plan documents can create avoidable litigation over where the case must be heard.
Recommended Changes
Employers should consider the following before including forum selection and contract formation provisions in employee restrictive covenant provisions:
- Consider whether a forum selection clause is needed or whether a choice of law provision will suffice.
- If a forum selection clause is needed, audit forum clauses across all employment-related templates. Confirm that each clause points to the forum the company would actually want to use if it needed to seek emergency relief.
- Align forum, choice-of-law, venue, arbitration, and place-of-formation provisions across related documents so the agreements do not point in different directions.
- Use place-of-formation clauses only when they reflect a deliberate strategy and the contracting process supports that strategy.
- Be mindful that relying on allegations about where an employee signed the agreement may be unavailing if the contract itself says it was formed somewhere else.
- Review competitor-related claims through the lens of the contract’s forum clause before filing because claims against a nonsignatory may still be treated as contract-related if they depend on the restrictive covenant agreement.
- Train legal, HR, and business teams to flag forum and formation language before sending updated offer letters, equity award documents, arbitration agreements, non-competes, or confidentiality agreements for signature.
Bottom Line
This decision does not mean employers should avoid forum-selection or place-of-formation clauses. Rather, it means employers should draft them with the same care they bring to the restrictive covenants themselves.
Before using a standard template, employers should ask a practical question: if a key employee leaves tomorrow and the company needs immediate relief, will this agreement send us to the court we actually want?
