Legal Question in Business Law in California
Non-competition agreements
2 of my employees have stolen my client list and other materials including about $1000 worth of equipment. they have both signed no competition agreements, now they are calling my clients and send them advertising material that looks like mine and sounds like mine, and are telling the clients that i sold them the list. What laws have they broken? what can i do?
3 Answers from Attorneys
Re: Non-competition agreements
There a few causes of action that come to mind, Tortious interference with contractual relations (you can get punitive damages on this one), breach of contract, injunction, etc.
I highly recommend that you retain an attorney on this matter immediatly!!
If you are in SoCal and would like a free telephone consult call me at 818-998-1584
Re: Non-competition agreements
First, the non-compete agreement is not likely to be enforceable. Non-compete agreements are enforceable in California in certain limited circumstances such as when selling your ownership interest in a business.
Next, there are several potential possibilities that you have. It would appear, based on the facts supplied, that they are engaging in unfair business practices, unfair competition, misappropriation and exploitation of trade secrets.
There are definitely steps that you can take including but not limited to attempting to obtain an injunction, and suing for damages.
This is the type of suit that is fairly involved. Thus, you should definitely consult with an attorney.
I would be happy to discuss this matter with you.
J. Caleb Donner
805-494-6557
www.donnerlaw.com
Re: Non-competition agreements
Non-competition agreements are not enforceable to the extent they prevent a former employee from pursuing a particular occupation, trade or business. If the agreement includes language to this effect, other provisions which would have been valid in the absence of the invalid provisions may be tainted and be rendered unenforceable.
Notwithstanding this possible problem with your case against these former employees, you have several very clear complaints or "causes of action" against them, including contract and tort claims:
(1) Breach of contract;
(2) Violation of the California Uniform Trade Secrets Act, Civil Code sections 3426 et seq.;
(3) Misappropriation of trade secrets;
(4) Common-law unfair competition;
(5) Unfair competition under Business & Professions Code sections 17200, et seq.;
(6) Breach of fiduciary duty;
(7) Tortious interference with contract;
(8) Intentional interference with prospective economic advantage;
(9) Negligent interference with prospective economic advantage;
(10) Conversion (of the physical property);
(11) Defamation, if they are denigarting you; and
(12) various trademark and copyright infringement offenses (for use of your materials).
You are entitled to immediate injunctive relief and compensatory and perhaps punitive damages, if there is proof of the transgressions you allege.
I have handled and am handling similar actions. Please contact me if you are in the Bay Area.
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