Quick answer: A non-compete agreement can stop you from using your own name, your own designs, and your own skills after you sell your business.
Richard and Victoria MacKenzie-Childs learned this the hard way. Before you sign, have an attorney define the scope, carve out exceptions, and protect your future livelihood.
Selling a business you built with your own hands is an emotional milestone—and a legal minefield. One document deserves more attention than almost any other: the non-compete agreement. Sign the wrong one, and you could lose the right to do the very work that made your name worth buying. The story of artists Richard and Victoria MacKenzie-Childs shows just how much is at stake, and why expert legal guidance matters before you put pen to paper.
This post walks through what happened to the MacKenzie-Childs founders, the real risks hidden inside a non-compete agreement, and how a small business attorney can protect your name, your craft, and your financial future.
The Rise and Sale of McKenzie-Childs
Richard and Victoria MacKenzie-Childs, ceramic artists married in 1974, built a beloved home decor company in Aurora, New York. Their whimsical, hand-crafted designs—often topped with a Scottish thistle motif—earned a devoted following and a premium reputation.
Then the financial side caught up with them. In 2000, the couple filed for bankruptcy, owing BSB Bank & Trust $15.3 million. In 2001, Pleasant Rowland—the founder of the American Girl doll brand and a wealthy Wells College alumna—purchased the company and its assets out of bankruptcy court for $6 million. That purchase included the designs, the trademarks, and, critically, the MacKenzie-Childs name.
What looked like a clean exit soon became a years-long fight over who the artists were even allowed to be.
Non-Compete Agreement Risks: The McKenzie-Childs Trap
Here’s where the non-compete agreement enters the story. Because the couple still owed roughly $10 million after the sale, Rowland reportedly threatened to collect that difference unless they signed a non-compete agreement. They refused. Instead, they filed for Chapter 7 personal bankruptcy to clear their debt.
That decision didn’t end the conflict—it set up a bigger one. After laying low for several years, Richard and Victoria returned to doing what they had always done: making and selling home decor. They launched a new company, V&R Emprise, LLC, and sometimes referred to themselves by their own names, Victoria and Richard.
In 2006, the company Rowland now owned sued the couple for trademark infringement. The suit sought to stop them from commercially using their first names, their last names, and a thistle logo the company said resembled the one it had purchased. In 2010, a federal court granted summary judgment that effectively barred the founders from commercially using the “MacKenzie-Childs” mark.
The lesson is blunt: when you sell a business that carries your name, the buyer may walk away owning that name—and the law may side with them.
Why Business Sellers Misunderstand a Non-Compete Agreement
Most sellers don’t set out to sign away their future. They simply underestimate what a non-compete agreement can do. Three blind spots show up again and again.
Emotional Attachment Blurs Legal Boundaries
When you’ve poured decades into a company, it feels like part of you. That emotional bond can make it hard to see your business as a set of legal assets—trademarks, designs, customer goodwill—that can be sold, restricted, and enforced against you later. Buyers and their lawyers, by contrast, see those assets with cold clarity.
Underestimating the Scope of a Non-Compete Agreement
A restrictive covenant can reach far wider than sellers expect. It may cover specific products, entire industries, broad geographic regions, and long stretches of time. Without careful limits, a non-compete clause can quietly prohibit work you assumed you’d always be free to do.
Signing Away Name Rights
This is the most painful trap of all. When your name is also your brand, the trademark you sell may include the right to use that name commercially. The MacKenzie-Childs case shows the result: founders barred from selling art under their own names. For anyone whose identity is tied to their craft, this risk deserves serious legal scrutiny.
How an Attorney Protects You from Non-Compete Agreement Pitfalls
A skilled small business attorney does more than read the fine print. They negotiate terms that protect your livelihood long after the deal closes. Here’s how.
Defining the Geographic and Temporal Scope of a Non-Compete Clause
A fair non-compete agreement has clear boundaries. Your attorney works to limit where the restriction applies and how long it lasts—so you aren’t locked out of your profession across the entire country for the rest of your career.
Carving Out Specific Exceptions
Not every future activity should be off-limits. An attorney can negotiate carve-outs that let you continue certain work, serve certain clients, or operate in certain regions, preserving options you’ll value down the road.
Protecting Your Future Livelihood
The core goal is simple: make sure you can still earn a living after the sale. Had the MacKenzie-Childs founders secured the right to use their own names for future artistic work, their second act might have looked very different.
Navigating Goodwill and Intellectual Property
Goodwill, trademarks, and designs are often the most valuable—and most contested—parts of a sale. An attorney helps you understand exactly what you’re transferring, what you’re keeping, and how to protect the intellectual property tied to your personal identity.
Secure Your Exit Strategy
A non-compete agreement should protect a fair deal, not erase your future. The MacKenzie-Childs story is a vivid reminder that the wrong terms can cost you your name, your craft, and your livelihood—long after the check clears.
Before you sell, get experienced legal eyes on every clause. The attorneys at Law 4 Small Business can help you understand the risks, negotiate fair terms, and protect what matters most. Contact Law 4 Small Business today to safeguard your exit strategy and your legacy.
Frequently Asked Questions
What is a non-compete agreement in a business sale?
A non-compete agreement is a contract clause that restricts a seller from competing with the buyer after a sale. It typically limits what work you can do, where, and for how long. In some cases, it also affects whether you can use your own name or designs commercially.
Can a non-compete agreement stop me from using my own name?
It can. If your name is part of the brand and trademarks you sell, the buyer may gain the right to use that name commercially. The MacKenzie-Childs founders were ultimately barred from selling products under their own name after their company and trademarks were sold.
How long should a non-compete agreement last?
There’s no single answer—courts generally expect restrictions to be reasonable in time and geographic scope. An attorney can help negotiate a duration and region that protect the buyer’s interests without permanently locking you out of your profession.
Why do I need an attorney to review a non-compete agreement?
A non-compete clause can be far broader than it first appears. An attorney defines its scope, negotiates carve-outs, and protects your future livelihood and intellectual property—catching risks that emotional sellers often miss.
How can Law 4 Small Business help with a non-compete agreement?
Law 4 Small Business reviews your sale documents, explains the risks in plain language, and negotiates fair terms that protect your name, your craft, and your ability to earn a living after the sale. Contact the firm to discuss your exit strategy.
Law 4 Small Business (L4SB). A little law now can save a lot later. A Slingshot company.
