Non-Compete, Non-Soliciation and Confidentiality Agreements in California

The California Supreme Court addressed the issue of non-compete agreements in the employment context in its leading decision on the issue, Edwards v. Arthur Anderson (2008). The court reiterated yet again the California's strong policy discouraging agreements restraining competition. In short, the Court held that virtually all non-compete agreements which are forced upon employees by their employers are void and unenforceable as a matter of law and public policy. The court went so far as to say that even those agreements which are narrow in scope and geographic location are invalid. 

The State's highest court also expressed its disfavoring of non-soliciation agreements, and noted that even when a former employee is contacting his employer's former clients, no law is violated, unless the competition itself is unfair, as it is in those cases where the information used to compete is found to be confidential or a trade secret.  

Just as importantly, the Court noted that when an employee is terminated for non signing a non-valid non-compete agreement, that employee will have a public policy violation claim which he can bring through civil lawsuit in court.