Legal Question in Business Law in California

You are in a very tricky situation, and one that spawns a great deal of litigation. The key is whether the customer lists or other customer information that you would use is a trade secret or business asset of your current employer. Figuring out when customer information is a trade secret or business asset and when it is not, however, is often difficult to do with any certainty, and that is where much of the litigation comes from. The good news is that your new employer will be obligated to indemnify and defend you if the old employer sues. The bad news is that it can cost you your new job if the new employer finds out about you selling to old customers only when they get a letter from the old employer's lawyer. I strongly recommend that you raise this issue with your new employer right away and have them make the decision on what they want you to do about the old employer's customers and customer information, with adivice from their legal counsel after their counsel has all the facts. If they don't want to vet it with their legal counsel, then get your own to advise you on the specifcs of your situation.

You may also want to check and se if you signed a non-compete agreement with old employer. This could also be a part of the employee handbook.

Scott

RulesOfEmployment.com

A non-compete agreement between an employer and an employee will be unenforceable to the extent it goes beyond protecting trade secrets. California law encourages competition and employee mobility......see, e.g., Business and Professions Code section 16600.

The principles of employment mobility and trade-secret protection are somewhat clashing and can create an unclear boundary between what is legal and encouraged and what is unfair and subjects one to liability. Selling to the same customers is OK to the extent that their indentities and potential needs are known in the industry, but it's not OK to the extent you get a special advantage through knowing the purchasing agent's favorite sports teams and whiskey.

Your new employer and you should discuss the possible problems and perhaps focus your efforts on new clients for a few months so you won't so blatantly be pursuing the same deals as you were with the former employer.