Legal Question in Business Law in California

Re: Non-competitive clause vs Right to Work State Law

This is a reply from a California lawyer. I don't know about the law in Utah, which apparently would control in your situation.

If this matter arose in California, the law would make a sharp distinction between your right to practice a certain trade or occupation, on the one hand, and your employer's right to protect its trade secrets and proprietary information, on the other. California courts have been pretty consistent in ruling that customer lists and even unwritten information about parties who purchase or are likely to purchase specific goods or services is trade secret if the (former) employee obtained or learned it while working for the employer.

There is also some federal law to the same effect, which suggests that many states would handle the situation the same way California does.

The phrase "right to work" usually means that you cannot be required to join a union -- that closed shop contracts are not permitted. Unless Utah gives the phrase an entirely different meaning, it has no applicability to your situation.

I would advise being extremely cautious about calling on anyone whose needs you might have become aware of while employed by the prior employer, unless those needs are obvious to the whole world and couldn't possibly be proprietary information.

Re: Non-competitive clause vs Right to Work State Law

Your layoff may create a defense to the non-compete agreement. Non-compete clauses are by law limited in time and scope. The terms of the non-compete together with the extant law are combined to determine the degree of restriction.

In general, if the non-compete exists, you would probably be limited in your ability to duplicate the services which your old employer provided to its customers. You will probably not be allowed to use any proprietary information or technology developed by your old employer.

If you are going to spend the time and money to establish a new business you may want to consult with an attorney to review your situation. I will provide an initial consultation with you at no charge. Get a copy of the non-compete for me to read.