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Calif. high court bans employee noncompete pacts

by Gina Keating, editing by Richard Chang LOS ANGELES, Aug 7 (Reuters) - The California Supreme Court on Thursday upheld the state's strict ban on most employee noncompetition agreements, ruling that companies cannot in any way limit a former employee's ability to ply his trade. The high court's decision nullifies previous appeals court rulings that allowed companies to require workers to agree not to compete with their former employer as long as the restrictions were narrowly tailored. The decision does not prevent employers from enforcing agreements to protect trade secrets, and should prompt California companies to take measures to protect themselves, intellectual property attorney lawyer Sean Lincoln said. The Supreme Court left alone exceptions in state law that allow noncompete agreements in cases involving the dissolutions or sales of corporations, partnerships and limited liability corporations.

Full post as published by The Trade Secrets Vault on August 11, 2008 (boomark / email).