Legal Question in Employment Law in California
Non Compete - Worked in CA, company HQ in Texas
I just left a company who is the largest global sofware reseller to go to a smaller national reseller that sells software, hardware and Prof Services.
The company I left has the HQ in Texas, but I worked remote office in N. California. They do have a physical office in Southern California.
I was employeed as an outside sales account manager.
I had to sign a non-compete when they hired me in 2002.
The Territory stated in the non-compete says ''shall apply to any territory or territories assinged to or served by Employee while employed by XXXX inlcuding, without limition, the following : San Francisco''.
Although the company sells only Software, the non compete is for the ''selling of any computer software, hardware and other computer-related goods and services and/or software, tehcnial and consulting services relation to information technology to such customer in competition with XXXX.''
The term is for one year after termination.
So it sounds like it says I can't sell any high tech services/products to any company.
I have been in high tech sales in N. California for over 12 years.
Is the non-compete enforceable?
They have already sent me a ''Improper Solications/Obligations'' letter.
Thank you!
2 Answers from Attorneys
Re: Non Compete - Worked in CA, company HQ in Texas
This law is in a state of flux. CA law is that a noncompete agreement violates public policy. However, because it was signed under TX law, there's a possibility that a CA court would uphold a noncompete judgment of a TX court. Therefore, you could find yourself in two courts -- in TX defending yourself and in a lawsuit you would bring in CA to invalidate the noncompete agreement. Whoever wins first prevails. That's not a very comforting thought.
Re: Non Compete - Worked in CA, company HQ in Texas
Your situation has no easy answer. California has a law that says that non-compete provisions are unenforceable. But when an employee signs an employment contract with a company based in a state that permits non-competes, and calls for that state's law to apply, a conflict exists between the states. The California Supreme Court has not clarified this issue.
Conceivably, the employer could file suit in Texas to seek an injunction to keep you from working for a competitor. It is not clear whether California courts must obey such an order. More importantly, would your new employer want to be caught up in such a legal battle if they hire you?
It may be worth the try, but you would have to disclose to the new employer the existance of the non-compete provision and see if they are willing to take on your former employer in court. Some companies are even willing to go to court first, in California, and seek an order invalidating the non-compete. They will probably have to discuss it with their legal counsel first.
Good luck.
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