At Reif Law Group, P.C., we regularly prosecute and defend high-stakes cases involving unfair competition, trade secret misappropriation, and corporate raiding in state and federal court. Our business disruption dispute practice group focuses on non-compete, non-solicit, and trade secret litigation in Southern California.
Whether you have been accused of violating a former employer’s non-disclosure policy or you are looking to protect your business’s legitimate interests, we can help. Contact our Los Angeles or Irvine office today to schedule a consultation.
Types of Business Disruption Disputes in Southern California
Businesses often look to protect their trade secrets, confidential business information, and client and employee lists through post-employment restrictive covenants in employment contracts and other agreements, including:
- Non-compete agreements to prevent an employee from taking a job with a direct competitor or starting a competing business
- Non-solicitation agreements to bar a departing employee from soliciting clients or employees away from the business
- Confidentiality agreements to prevent a former employee from using the company’s proprietary or confidential business information
In short, restrictive covenants are intended to protect an employer that (1) must share confidential business information with employees and (2) spend time and resources training an employee who may then leave for a competitor. In other words, restrictive covenants are designed to prevent former employees from causing harm to the business.
On the other hand, an overly broad restriction can impede employee mobility. Disputes over restrictive covenants often involve claims of breach of contract, interference with business relationships (tortious interference), and/or misappropriation of trade secrets.
How Reif Law Group Can Help with Your Business Disruption Dispute
At Reif Law Group, we regularly represent executives, professionals, salespersons, and other high-level employees in prosecuting and defending restrictive covenant disputes. Our aggressive corporate law attorneys work with clients across multiple industries to (a) enforce agreements that are intended to protect confidential business information and (b) challenge agreements that impair the individuals right to compete in the workplace.
Our practice focuses on trade secrets, computer fraud, employee mobility, and restraining orders involving restrictive covenants, as well as privacy policies and stolen computer data.
While business disruption disputes are best resolved through negotiated settlements, these time-sensitive cases may require swift court intervention to protect our clients’ interests.
Our legal team is fully prepared to quickly mobilize a prosecution or a defense of high-stakes, fast-paced disputes involving employee restrictive covenants. We have a proven history of achieving positive outcomes, ranging from the prompt return of stolen trade secrets, to cease and desist demands, to obtaining emergency relief, such as restraining orders, injunctions, and writs of attachment in a variety of cases. We are also often called upon to pursue or defend against a temporary restraining order or a preliminary injunction aimed at stopping the adversaries’ conduct.
Are restrictive covenants in employment contracts enforceable in California?
The laws regarding restrictive covenants vary state to state and non-competes, in particular, have been the subject of heightened scrutiny in multiple jurisdictions. In California, non-compete agreements are generally not enforceable under the state law (California Business and Professions Code Section 16600), unless statutory exemptions apply, including:
- Business sales involving corporate stock or goodwill
- The dissolution of a partnership
Moreover, employers in the state cannot enforce a non-compete agreement under the choice of state law doctrine or to prevent the so-called inevitable disclosure of trade secrets since amendments to the California Labor Code went into effect on Jan. 1. 2017. However, non-compete agreements with such provisions entered into prior to the date may still be enforceable.
California’s strong public policy allowing employees to perform their chosen profession or trade also has implications for non-solicitation agreements; courts have held that client/customer non-solicitation agreements are not enforceable.
On the other hand, employee non-solicitation agreements are considered valid as long as they are narrowly construed. To enforce such a restrictive covenant, it must be lawful, reasonable, and must not have a significant impact on trade or business. In particular, courts may enforce an employee non-solicitation agreement if there are legitimate trade secrets involved.
Finally, confidentiality and non-disclosure agreements are generally enforceable, but they must be limited to protecting:
- Proprietary information
- Trade secrets
- Customer lists and contact information
In short, to be enforceable, a non-disclosure agreement must clearly identify the parties to the agreement (employer, employee, and any other relevant third party), specify its duration (longer than 1-year may be overly broad), and clarify the scope of the confidential information.
Contact Our Experienced California Business Disruption Dispute Attorneys
Despite California’s strong stance on protecting employee mobility and court rulings that have invalidated non-compete and non-solicitation agreements, business disruption disputes are often inevitable.
Whether you are an employee looking to protect your right to practice your profession or trade or a business that needs to protect its confidential business information, you need the powerful representation Reif Law Group provides. Contact us today to speak with one of our attorneys.