California Employment Law Update

Tag Archives: non-compete

California Employee Required to Challenge Non-Compete Clause in Indiana

Despite California’s prohibition against non-compete agreements, a federal court in the Eastern District of California recently ruled that a California resident may be subject to the non-compete covenant in his employment agreement due to a provision in the agreement identifying Indiana as the parties’ choice of forum and that state’s law as the parties’ choice … Continue Reading

Employee Was Bound By Stipulated Injunction That Prohibited His Solicitation Of Customers

Wanke, Indus., Commercial, Residential, Inc. v. Superior Court, 209 Cal. App. 4th 1151 (2012) In an underlying lawsuit, Wanke sued its former employees Scott Keck and Jacob Bozarth for misappropriation of trade secrets, among other things. That lawsuit was settled, and the parties agreed to a stipulated injunction pursuant to which Keck, Bozarth and their … Continue Reading

Post-Employment Non-Compete Covenant Could Not Be Enforced Against Seller/Employee Of Company

Fillpoint, LLC v. Maas, WL 3631266 (Cal. Ct. App. 2012) Michael Maas sold his stock in Crave Entertainment Group, Inc. to Handleman Company and signed a stock purchase agreement that contained a three-year covenant not to compete. Maas signed a separate employment agreement with Crave that contained a one-year covenant not to compete, which would … Continue Reading

September 2011 California Employment Law Notes

We invite you to review our newly posted September 2011 California Employment Law Notes — a comprehensive review of the latest and most significant developments in California employment law.  The highlights include: Employee Who Provided False SSN and Other Information Was Barred from Suing for Disability Discrimination Employer Did Not Violate CFRA by Transferring Employee upon Her … Continue Reading

Injunction Upheld Prohibiting Former Employee from Competing

NewLife Sciences, Inc. v. Weinstock, 197 Cal. App. 4th 676 (2011) NewLife terminated the employment of Ronald Weinstock, the purported inventor of a Therapeutic Magnetic Resonance Device (“TMRD”), which NewLife had purchased approximately one year before the termination. In connection with its purchase of the TMRD, NewLife had obtained a non-compete covenant, which prohibited Weinstock … Continue Reading

Employee Terminated For Violating Non-Compete Could Proceed With Lawsuit

Silguero v. Creteguard, Inc., 187 Cal. App. 4th 60 (2010) Shortly after Creteguard hired Rosemary Silguero, her former employer (FST) contacted Creteguard and “requested the cooperation and participation of [Creteguard] in enforcing the confidentiality agreement [between Silguero and FST], including those provisions prohibiting Silguero from all sales activities for 18 months following Silguero’s departure or … Continue Reading

Non-Compete Agreements Were Unenforceable

Asset Marketing Systems, Inc. v. Gagnon, 542 F.3d 748 (9th Cir. 2008) Kevin Gagnon, doing business as “Mister Computer,” alleged that his former customer, Asset Marketing Systems (“AMS”), infringed his copyright in six computer programs that he wrote for AMS by continuing to use and modify them without his consent and that AMS misappropriated trade … Continue Reading

Customer Non-Solicitation Covenants Violate Public Policy Against Non-Competes

Edwards v. Arthur Andersen LLP, 44 Cal. 4th 937 (2008) CPA Raymond Edwards II was hired in 1997 as a tax manager for the Los Angeles office of the now defunct accounting firm Arthur Andersen LLP (“Andersen”). As a condition of his employment, Edwards was required to execute a noncompetition agreement that prohibited his (1) … Continue Reading

Non-Compete Covenant Was Not Too Broad To Be Enforced

Alliant Ins. Services, Inc. v. Gaddy, 159 Cal. App. 4th 1292 (2008) Alliant Insurance Services purchased a competing insurance brokerage company from G. Scott Gaddy for $4.1 million and then employed him under a senior management agreement. Both the purchase and employment agreements contained covenants whereby Gaddy agreed not to compete with Alliant or to … Continue Reading

Individuals Who Sold Business Were Properly Enjoined From Competing In Violation Of Contract

Huong Que, Inc. v. Luu, 150 Cal. App. 4th 400 (2007) After Mui Luu and Cu Tu Nguyen sold Huong Que, Inc. (the “most well known, recognized and trusted brand name for traditional style Vietnamese calendars”) to Con Tu, they agreed to remain employed as the company’s “managing agents.” The sales agreement contained a covenant … Continue Reading

Employer’s Use Of Non-Compete May Create Liability For Interfering With Employee’s Prospective Economic Advantage

Edwards v. Arthur Andersen LLP, 142 Cal. App. 4th 603 (2006) Raymond Edwards II, the former tax manager for the Los Angeles office of the now defunct accounting firm Arthur Andersen LLP, had executed a non-competition agreement that prohibited him from performing professional services for 18 months post-employment for any client whose account he had … Continue Reading

New York Federal Court Enjoins California Employee From Competing With His Former Employer

The Estée Lauder Companies Inc. v. Batra, 430 F. Supp. 2d 158 (S.D.N.Y. 2006) While working as Global General Brand Manager for Estée Lauder, Shashi Batra (a resident of San Francisco) signed a non-compete agreement that prohibited him from competing with the company anywhere in the world for a period of 12 months after his … Continue Reading

Employer Was Improperly Prohibited From Seeking To Enforce Non-Compete Agreement

Biosense Webster, Inc. v. Superior Court, 135 Cal. App. 4th 827 (2006) Biosense, a manufacturer and seller of electrophysiology catheters and anatomical mapping devices, had its employees sign non-competition agreements prohibiting them from providing services to “conflicting organizations” for 18 months after leaving Biosense. After three of its former employees went to work for St. … Continue Reading

Federal Court May Not Bar Tennessee Court From Enforcing Non-Compete Agreements

Bennett v. Medtronic, Inc., 285 F.3d 801 (9th Cir. 2002) Medtronic, Inc. sued three of its former California employees and their new employer, NuVasive, in Tennessee following the employees’ resignation from Medtronic and acceptance of employment with NuVasive, one of Medtronic’s competitors in the business of designing and manufacturing spinal surgery devices. Among other things, … Continue Reading
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