California Supreme Court Affirms Ban on Noncompetition and Nonsolicitation Agreements Under California Law
| August 13, 2008 |
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By Jennifer L. Brockett, Stuart W. Miller, John P. LeCrone and Emilio Gonzalez
California's Supreme Court, in the recent case of Edwards v. Arthur Anderson LLP, has affirmed California's long-standing ban on noncompete agreements and explicitly extended it to so-called “nonsolicitation” provisions, as well. The Court ruled that noncompetition and nonsolicitation clauses are void in California, unless they fall within a statutory exception, such as agreements involving the sale of a business or shares of stock in a corporation. The Court also found that an employer that requires employees to sign an agreement containing such a clause may commit an unlawful business practice subject to tort damages. Continue reading...
