Edwards v. Arthur Andersen LLP, No. BC 294853 (Cal. Aug. 7, 2008)
Articles Discussing Case:
Common Non-Competition Agreement Provision Now Invalid.
Barker Olmsted & Barnier • September 04, 2008 • Report Link
When an employee leaves your company, chances are that he or she will go to work for a competitor. It is certainly unsettling to know that someone with inside knowledge of your company has fallen into the hands of a rival. Worse yet, that employee may seek to call on your clients or recruit your key employees.
EDWARDS V. ARTHUR ANDERSEN: NON-COMPETE AGREEMENTS AND GENERAL RELEASES.
Shaw Valenza LLP • August 28, 2008 • Report Link
California law is tough on agreements that restrain an individual from engaging in his or her profession, trade or business. The only statutory exceptions to this strict rule are non-competition agreements associated with certain business sales transactions and dissolution of partnerships. There are common law restrictions as well. For example, employees usually cannot directly compete with a current employer where doing so would constitute a conflict of interest. Additionally, employees may be restricted from certain post-termination activities to protect the former employer’s trade secrets. Employers also may use financial disincentives to dissuade employees from leaving, such as requiring repayment of training costs, and bonuses that require employment on a certain date.
California - California Supreme Court Invalidates Non-Compete Agreement.
Ogletree Deakins • August 19, 2008 • Report Link
In a unanimous decision, the state’s highest court recently ruled that a noncompetition agreement entered into between an employer and one of its former employees is unenforceable under California law. In so doing, the California Supreme Court upheld a longstanding state law restricting employers from using such agreements to restrain employees’ practice of their professions.
California Supreme Court Rules On Non-compete Agreements And On General Releases.
Fisher & Phillips, LLP • August 12, 2008 • Report Link
The California Supreme Court recently handed down a long-awaited and significant decision addressing the nature and scope of non-competition agreements in California. The ruling also addressed the enforceability of contract provisions requiring employees to release "any and all" claims. The case has important consequences for California employers.
