Non-Competition Agreements in California: The Fine Line Between Good and Bad

In our practice we are often called upon to resolve disputes between private companies and their owners or employees. Almost invariably, these disputes involve covenants not to compete, otherwise known as non-competition agreements. Companies often try using these agreements to protect themselves against competition from former owners or employees. Despite the fact these agreements have been illegal in California since just after the Gold Rush, they remain widely used. And although there are some exceptions to the general rule that prohibits them, those exceptions are narrow and rarely enforceable.

An article I wrote for the Orange County Lawyer explains the law and its background, provides an overview of the current state of the law, and describes the exceptions.