Florida: A Litigation: General Commercial: Highly Regarded Overview

Florida: the Premier Pro-Business Haven and the Evolution of Commercial Certainty

Florida continues to solidify its reputation as a premier pro-business haven by enacting thoughtful legislation designed to provide business owners with certainty, flexibility and robust legal protections. While many jurisdictions are moving toward more restrictive regulatory environments, Florida’s legislative trend favors the entrepreneur by offering a sophisticated toolkit for managing risk and protecting intellectual capital. Key to this evolution are three landmark pieces of legislation:

• the CHOICE Act;
• the newly enacted Protected Series LLC Law; and
• the modernized Securities and Investor Protection Act.

Together, these acts form a comprehensive shield for business interests and ensure that the strategic decisions of owners are protected by statute and enforceable in the courts.

The CHOICE Act: Strengthening Restrictive Covenants

The Contracts Honoring Opportunity, Investment, Confidentiality, and Economic Growth (CHOICE) Act, which took effect on 1 July 2025, represents a significant shift in Florida’s approach to protecting proprietary interests and provides employers with stronger tools to safeguard intellectual property and customer relationships.

The CHOICE Act governs two types of agreements: “covered garden leave agreements” and “covered noncompete agreements.” A “garden leave” agreement is an arrangement in which an employee remains on the employer’s payroll during a specified period prior to the termination of the employment relationship, but is effectively prevented from active duties and prohibited from competing with the employer. A “covered noncompete agreement” is a written agreement in which an employee agrees, for a period not to exceed four years and within a defined geographic area, to refrain from assuming a role with or for another business, entity or individual where the employee would either:

• provide services similar to those provided to the covered employer during the three years preceding the noncompete period; or
• be reasonably likely to use the covered employer’s confidential information or customer relationships.

The Act sets forth specific requirements that each type of agreement must satisfy, providing both employers and employees with clear statutory guidance on essential terms and conditions.

The CHOICE Act applies specifically to “covered employees” – those employees (excluding certain healthcare professionals) earning at least twice the annual mean wage of the Florida county in which the covered employer has its principal place of business, or, if the covered employer’s principal place of business is not in Florida, the Florida county in which the employee resides.

The legislation distinguishes Florida from other states by providing several powerful advantages to businesses.

• Expanded duration: covered non-compete and “garden leave” agreements can extend for up to four years post-employment, expanding Florida’s prior two-year statutory presumption of unreasonableness.
• Presumptive enforcement: the Act presumes the enforceability of these agreements, placing a high burden on the employee or a new employer to prove that the restraint is unnecessary or that the agreement was breached by the original employer.
• Mandatory injunctive relief: if an employer seeks to enforce a covered noncompete agreement, the court must preliminarily enjoin the offending party from engaging the covered employee during the non-compete period. The injunction may only be modified or dissolved if the enjoined party demonstrates, by clear and convincing evidence, that the employee will not provide similar services or use the employer’s confidential information or customer relationships, or that the new employer is not engaged in (and does not plan to engage in) similar business activities within the agreement’s defined geographic area.

The Florida Series LLC Law: a New Era of Asset Protection

Beginning 1 July 2026, Florida will join the ranks of sophisticated business jurisdictions such as Delaware by allowing for the domestic formation of protected series LLCs. This long-anticipated update to the Florida Revised Limited Liability Company Act allows a single “parent” LLC to establish multiple “protected series,” each with its own assets, liabilities and business purposes. This structure provides business owners with several strategic options.

• Horizontal liability shielding: each protected series is legally insulated from the debts and obligations of the parent LLC and all other series within the same structure.
• Operational efficiency: owners can manage diverse ventures or real estate portfolios under one umbrella entity, potentially reducing filing fees, administrative paperwork and registered agent costs.
• Statutory recognition: the law treats each series as a distinct “person” for purposes such as contracting, ownership and secured transactions.
• Strict record-keeping requirements: to maintain these protections, the law mandates that each series maintain precise, separate records that clearly identify which assets belong to which series.

The Securities and Investor Protection Act: Modernizing Capital Formation

Florida recently implemented sweeping amendments to its Securities and Investor Protection Act (Chapter 517 of the Florida Statutes) to simplify capital formation while reinforcing market integrity. Effective 1 October 2024, these updates align Florida’s regulatory framework more closely with federal standards, providing a more predictable path for issuers and investors alike. Key provisions include the following.

• Accredited investor alignment: the Act redefines “institutional investor” to mirror federal Regulation D criteria, broadening the pool of eligible participants for private placements.
• Simplified raising of capital: the Small Corporate Offering Registration (SCOR) filing fee was slashed from USD1,000 to USD200, and a USD5 million cap was introduced for simplified filing exemptions, making it easier for smaller Florida-based businesses to raise funds.
• Enhanced disclosures: to provide certainty to investors, the Act mandates the filing of Form D within 15 days of the first sale in Florida and requires clearer disclosure of material risks.
• Bad actor disqualification: the new Section 517.0616 adopts federal “bad actor” disqualifications, ensuring that fraudulent individuals cannot exploit the state’s exemptions, thereby protecting the reputation of Florida’s financial markets.

Conclusion: a Fortress of Business Protections

The strategic implementation of the CHOICE Act, the Series LLC framework, and the modernized Securities and Investor Protection Act confirm Florida’s commitment to being a stable and innovative business environment. These legislative efforts create a rigorous legal infrastructure that offers business owners diverse options for structuring their entities, protecting their competitive advantages, and accessing capital. By providing statutory clarity and streamlined enforcement mechanisms, Florida ensures that the rights of business owners are enforceable in a court of law. For the entrepreneur, Florida remains a jurisdiction where the law provides the certainty required for long-term economic growth.