California has passed two new items of legislation, Senate Bill 699 and Assembly Bill 1076, which will further regulate and restrict the enforcement of employment non-compete agreements in California, and expand the scope of remedies for those affected by them. These new laws will become effective on January 1, 2024, and now is the time for employers to assess and revise their employment-related agreements and restrictive covenants accordingly. As detailed below, they also require employers to notify employees and certain former employees by February 15, 2024 that certain non-compete provisions are void. The two new laws are detailed below.Continue Reading California Strengthens Non-Competition Law
Travis Anderson is a partner in the Labor and Employment and Business Trial Practice Groups in the firm's San Diego (Del Mar) office. He is a member of the Trade Secrets team.
On July 9, 2021 President Joe Biden issued an Executive Order on Promoting Competition in the American Economy, which urges the Attorney General and Federal Trade Commission (FTC) to curb the use of non-compete and no-poach agreements. The Executive Order aims to foster a “fair, open, and competitive marketplace,” and calls for a “whole-of-government” approach to reverse trends of industry consolidation and anticompetitive practices. The Order indicates these trends have harmed employees’ wages, work conditions, and mobility. It further targets what it characterizes as the “overuse” of non-compete agreements and other barriers to entry in certain markets.
Continue Reading President’s Executive Order Aims to Foster a Competitive Marketplace
Trade secrets and other proprietary information can be among a business’ most valuable assets and drive its competitive advantage. It is therefore ordinarily critical that employees be bound by an enforceable agreement that prohibits them from misusing or otherwise harming the value of the employer’s confidential information. The recent California Court of Appeal decision, Brown v. TGS Management Co., LLC (2020) 57 Cal.App.5th 303, should be of concern to employers because it holds that an employee confidentiality agreement may be voided as a de facto unlawful non-compete agreement if it has the effect of preventing the employee from working in the industry.
Continue Reading California Court Strikes Down Overbroad Confidentiality Agreement as a de facto Non-Compete
Non-compete, proprietary information, and confidentiality agreements often contain forum selection provisions, which specify where any related litigation must be brought. But what is to happen when the underlying agreements contain different forum selection provisions? A United States District Court for the Southern District of Indiana recently addressed this very issue, and held that in such cases, a court must decide for itself which proposed forum has the greater connection to the underlying dispute by focusing on just the facts. See High Tech Nat’l, LLC v. Wiener, No. 119-CV-02489-SEB-MJD (S.D. Ind. Nov. 26, 2019).
Continue Reading Trade Secrets and Conflicting Forum Selection Provisions – Focus on the Facts!
Social media contact lists have become an increasingly important part of a business’s customer lists. While courts are still grappling with who legally “owns” the data that the employee acquired on the employer’s dime—such as LinkedIn customer connections or access to a list of Twitter-feed recipients—employers can still take steps to bolster the company’s claim of ownership.
Continue Reading Protecting Social Media Contact Lists as Trade Secrets