Legal Question in Business Law in California

People can sue each other by writing down a valid or invalid or even an imaginary grievance and shoving it over the court clerk's counter with the $355 (for Superior Court-unlimited) filing fee. Well, there's a bit more to it, but not much. The real question is whether the other person can sue and win.

Here, It's very doubtful that your former business partner would have a winnable case unless there are unusual facts. California has a strong legislative (statutory) policy of fostering competition by not enforcing contracts which have the effect of barring anyone from pursuing any lawful business, trade or occupation. See, e.g., Business and Professions Code section 16600.

There are two possible areas of caution here. First, in connection with the breakup of the old business, did you divide up its remaining assets in a way so that it could possibly be claimed that she got the goodwill, and you got something else in exchange? Not likely, partly because failing businesses generally don't have goodwill, but it's possible.

The other possible danger area is whether you would be using any trade secrets to which she has a greater claim than you have. One cannot lawfully misappropriate trade secrets for improper purposes, including starting a new business. Here again, the likelihood of a trade secret still having value and belonging to the other seems quite remote, but again, it is possible.