Courts are increasingly scrutinizing agreements that extend beyond what is necessary to protect bona fide confidential information and trade secrets. The recent decision in Hamilton v. Juul Labs, Inc., Case No. 3:20-cv-03710-EMC, illustrates this trend. On January 27, 2021, a California federal judge ruled that an ex-employee’s lawsuit against e-cigarette manufacturer Juul Labs, Inc. regarding Juul’s allegedly over-restrictive non-disclosure agreements (NDAs) may move forward. The case, filed by Juul’s former Director of Program Management, Marcie Hamilton, is pending before the U.S. District Court for the Northern District of California, Judge Edward M. Chen presiding.
Continue Reading A “Culture Of Concealment” – Scrutinizing Overbroad NDAs
California Court of Appeal Rules that Challenge to Google’s Confidentiality Agreements May Proceed Past the Pleading Stage
On September 21, 2020, in a published 2-1 opinion in Doe v. Google Inc., the California Court of Appeal (Dist. 1, Div. 4), permitted three current and former Google employees to proceed with their challenge of Google’s confidentiality agreement as unlawfully overbroad and anti-competitive under the California Private Attorneys General Act (“PAGA”) (Lab. Code § 2698 et seq.). In doing so, the Court of Appeal reversed the trial court’s order sustaining Google’s demurrer on the basis of preemption by the National Labor Relations Act (“NLRA”) (29 U.S.C. § 151 et seq.) under San Diego Bldg. Trades Council v. Garmon, 359 U.S. 236, 244–245 (1959). The court held that while the plaintiffs’ claims relate to conduct arguably within the scope of the NLRA, they fall within the local interest exception to Garmon preemption and may therefore go forward. It remains to be seen whether plaintiffs will be able to sustain their challenges to Google’s confidentiality policies on the merits. However, Doe serves as a reminder to employers to carefully craft robust confidentiality agreements, particularly in the technology sector, in anticipation of potential challenges employees may make to those agreements.
Continue Reading California Court of Appeal Rules that Challenge to Google’s Confidentiality Agreements May Proceed Past the Pleading Stage