California Non-Compete Law on Venue

California rarely recognizes non-compete agreements in court.

A non-compete clause is an agreement where a party agrees not to pursue a profession or trade that may be in competition with the other party's profession or trade. Non-compete agreements are almost voided by California courts.

Non-Compete Law of California

California's non-compete law clearly states that "every contract by which anyone is restrained from engaging in a lawful profession, trade, or business of any kind is to that extent void." California courts can further interpret the law to mean former employees can accept work from their former employee's clients and solicit the employees of the former employer. Non-compete agreements involving venues are voided under this law.

Exceptions

Non-compete agreements in the sale of the "goodwill" of a business or in the break-ups of corporations and partnerships are recognized under California law. The owner of a venue may be able to force a non-compete clause under the "goodwill" exception. The owner must prove his company was sold with a good reputation that improves the company's value beyond its assets.

Non-Disclosure Agreement

Non-disclosure agreements of any business are enforced in California. A non-disclosure agreement is a contract between two parties agreeing not to disclose confidential material, information or knowledge to any third parties.

References

• State Supreme Court rejects noncompete clauses
• California Non-Compete Agreements By Attorney Brian Kindsvater