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What constitutes a violation of a non-compete agreement?

Question Details:I am considering starting my own trade publication that is similar to the one I work for right now. My current employer has a non-compete agreement, a part of which talks about "trade secrets" and "proprietary information" which he defines as "any notes, names and mail lists derived by working with (my company)" Without getting into too much detail, what do think the potential for a lawsuit is, and/or what can my current employer do if I go ahead and start my own publication that covers the same industry? For what it's worth, I don't have his mailing list.

Asked 2 years ago under Employment and Labor | 1389 Views | More Legal Topics

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Deborah Barron | Barron Law Offices Answered 2 years ago | None Contributor with 0 answers This Sacramento, CA attorney is licensed in California

In California, non-compete agreements are illegal and not enforceable because they would be a restraint on trade.  So you can use the employers mailing list of customers, approach the customers for business. 

While I have seen lawsuits brought against ex-employees for approaching and doing business with their ex-employer's customers, it does not mean they have legal grounds to support such a cause of action in the State of California.     

The types of trade secrets or proprietary information that might be protected would be policies, manuals, processes, inventions, manuscripts, advertisements, logos, trademarks, slogans, etc... of the company, the ex-employer.   

For example, if you worked for a toy designer and you left and started your own company and designed and sold a toy that was primarily identical to one manufactured by the ex-employer, expect for the name, that could be construed as a misappropriation of a trade secret as a matter of law.   Especially if  the toy was unique and other companies were not copying it.  

Deborah Barron, Esq.  www.lawbarron.com San Francisco & Sacramento Lawyer 

SJZ, Member, New York Bar | FreeAdvice Contributing Attorney Answered 2 years ago

If you don't use any of his trade secrets or proprietary information, he would seem to have no grounds to sue. That means not using mailing lists, of course, but probably also means don't structure your publication after his (unless his follows the general pattern of all publications in this area), don't use industry contacts you only met as a result of working for the other publication...basically, only use information that someone who did *not* work for this publication would have found or come to, as well as specifically not using lists or materials from that company.

Mind you, if he's made enough he can still huff, puff, and potentially file a lawsuit (it's almost impossible to stop a lawsuit from being filed if someone is bound and determined); but if you can point to readily and publically available sources (such as derivived from comparing a number of other publications; or info from trade assocations you join; or information from consultants, mailing list providers, and other vendors; or even info from the Internet) for everything, it would be very difficult to prevail.

B. B., Member, New Jersey Bar | FreeAdvice Contributing Attorney Answered 2 years ago

It's impossible to give you reliable advice, "without getting into too much detail."  Most lawsuits turn on facts that most people would consider among the "details."  And, in a non-compete agreement case, the exact wording of the document is often critical.  You need to have an experienced attorney review the document, and the details, before you go ahead with this.

Non-compete agreements are usually interpreted very tightly, to limit the restriction on a person's ability to earn a living.  However, if the contract is valid, the court won't write you a better one.

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