Re: LAW: (long) enforceability of noncompete agreements

[Elna Tymes <etymes -at- LTS -dot- COM>]

John Gough wrote:
>
> 1. What is the law in CA?

Good question.  The "law," as I understand it, is being created as a
body of case work, one of the most recent ones being the successful suit
against the president of AVANT! and several of that company's
employees.  You can do a search for the company name in any of the trade
magazine databases and probably come up with  digest of what happened.

I am no lawyer.  (I wouldn't want to be, either!)  However, I've been
advised on this subject by lawyers whom I paid for the advice, and my
comments are based on what they told me, plus what I've read, plus what
I've experienced in some 30 years working in Silicon Valley.

> 2. What are some cases in which the law has been enforced
>       or shown to be unenforceable? Real citations please,
>       in any area.

What you're asking of me is the kind of information you'd be better off
asking of someone whose specialty is this kind of law.  And be prepared
to pay for it. If you want to go searching through Nexus/Lexus, be my
guest.  I do other things with my time.

> 3. What are the cases in which the law has been enforced
>       for a technical writer, as opposed to executives
>       or key technical personnel?

Again, see #2.
>
> The reason this issue is interesting at all is because technical
> writers who work on contract run into the clause a lot. My question
> is whether it is a legitimate restriction or a case of a companies
> overzealously covering their butts and wanting to make contractors
> pay the price of their paranoia.  It is my opinion that the clauses
> constitute restraint of trade.

And until tested in court, it remains just that: your opinion.  If you
want to bet your personal fortune on being right, be my guest.  I have
other uses for my money.

> Your claim that the noncompete is a "standard clause" is
> correct. My point is that it should not be.

And mornings shouldn't occur until you're really ready to get out of
bed.  So?

> I bet if you
> ran a survey in Silicon Valley, 80% of the technical writers
> who have worked for three or more clients are in technical
> violation of that clause.  Hey, the reason you are hirable
> by one company may be your experience working for another
> that is in the same market (OS's, databases, multimedia chips,
> etc.)

You may be right.  Again, so?
>
> >From my previous (undocumented) post I got one email from someone
> who knew a technical writer who was sued for violating a noncompete.

Look - (and I can speak from personal experience on this one) - a lot of
lower court cases like this are won simply because the defendant
couldn't afford to pay a lawyer the amount it would take to defend
himself.  Lawyers don't generally take cases on the basis of what's
right and what's wrong, despite the premise of some TV shows.  They
generally take cases based on (1) whether the client can pay, and (2)
whether they feel the case can be won.  Sometimes (2) isn't a factor at
all. How many salaried technical writers do you know who can afford
$250,000 legal fees from out-of-pocket earnings?

> We aren't paying much attention to the clause now.  As professionals
> with a vested interest in an open market we should be cautious about
> what makes its way into "standard" contracts.

Oh please.  That's like saying that we should legislate "standard"
English grammar.  When was the last time you used "ain't" in common
conversation? Tsk, tsk! <g>

Elna Tymes
> ============================================================
> >John Gough wrote:
> >>
> >> 1. Do not accept noncompete clauses in contracts.
>
> Elna Tymes wrote:
> >You probably wouldn't be hired by most companies in Silicon Valley,
> >then.  Noncompete agreements are standard around here - but they specify
> >that you aren't to go to work for this company's clients or for
> >companies who have parallel products.  If you want to be a contractor in
> >Silicon Valley, I don't know of a single agency that doesn't have a
> >non-compete clause, and they simply won't deal with you if you decline
> >to sign it.
>
> >> 2. To sue successfully for violation, a company usually has to
> >>    demonstrate material loss, *depending on the state laws*
> >>    where you did business with the company.  If you find yourself
> >>    being pursued by a company, one of the best defenses is to write
> >>    (or have a lawyer write) a rejection of their claim of contract
> >>    violation, citing state law and evidence that you do not
> >>    fit under the law.  This may prevent the company from suing
> >>    (since they see that you know the law and are prepared to defend
> >>    yourself) and at least kick it to mediation.
> >
> >And the cost of having a lawyer write that - and let's face it, the
> >power in this is getting a lawyer to use letterhead stationery to make
> >your case before filing anything - can be substantial, depending on who
> >you're fighting.
> >
> >In addition, people at agencies tend to move around a lot - and usually
> >take their databases with them, despite the agencies' attempts to
> >prevent that.  Which means that if you stiff one agency, the people
> >associated with that agency NOW will remember you six months from now
> >when they see you at another agency.  You sure you want to burn that
> >bridge?
> >
> >There's some current what-amounts-to-history in California being written
> >by the settlements between Informix and Oracle, and between several
> >other sets of companies involved in this area.  One company recently
> >lost just such a suit and its president has been found guilty and is
> >facing jail time and a fine.  As you said, this area is quickly
> >developing and it pays to pay attention. What's so in Texas appears to
> >be not so in California.
> >
> >Elna Tymes
> >Los Trancos Systems
> >
>
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