On January 12, 2026, the U.S. Court of Appeals for the Eighth Circuit vacated a preliminary injunction in Choreo, LLC v. Kevin Lors et al., reinforcing the high threshold for injunctive relief in restrictive covenant disputes. The Court found that Choreo’s alleged losses, client departures and revenue, were quantifiable and compensable through monetary damages, rejecting claims of irreparable harm. It also noted that most harm had already occurred before the injunction was issued, further undermining the basis for equitable relief.

Key Takeaways for Employers

This decision underscores several key points:

• Injunctive relief requires clear, non-speculative evidence of imminent, irreparable harm, not just financial loss.
• Employers should document specific impacts, such as loss of goodwill or client relationships and explain why monetary damages cannot adequately address the harm.
• Restrictive covenants should be tailored and reviewed regularly to ensure enforceability.

Action Steps Employers Should Take

To reduce risk and strengthen protections, employers should:

1. Audit existing employment agreements for compliance and enforceability.
2. Develop protocols for advisor departures and client retention.
3. Prepare detailed evidence when pursuing injunctive relief.

Impact of This Decision

This ruling underscores the importance of proactive planning and strong documentation when protecting client relationships. Firms should not rely solely on preliminary injunctions but instead implement comprehensive strategies to mitigate risk.

If you have questions about restrictive covenants or strategies for protecting client relationships, please contact  your UBG attorney or Chris Pickett at cpickett@ubglaw.com.

To read more about this decision, see the full article [link to full article].

The information provided in this alert speaks only to the information and guidance we have available as of the date of publication and is subject to change. This legal update was created by UB Greensfelder LLP and is not intended as a substitute for professional legal advice. Receipt, by itself, does not create an attorney-client relationship. For any questions, or for further information, please contact your UB Greensfelder attorney.