CA Vs. MA In Battle Over Non-Compete Clause

Lucas123 writes "A case was filed with superior courts in California and Massachusetts involving a former EMC top executive who is trying work for HP. The case is throwing into relief Massachusetts's and California's differing approaches to non-compete clauses in employment contracts. California courts have argued that non-competes hamper a person's ability to traverse the marketplace freely for work, while Massachusetts courts say the agreements actually afford freedom to develop technology without the fear of IP theft."

Comments

Hey

[ta bu shi da yu]

In Australia, non-compete clauses are classed as restraint of trade, and thus illegal. Sucked in ex-EMC executive!

Re:Hey

[HalfFlat]

In Australia, non-compete clauses are classed as restraint of trade, and thus illegal.

This is, as far as I know, not true. Non-compete clauses are legal, but not universally regarded as valid — they are evaluated on a case-by-case basis. Here is an interview with Peter Townsend, a lawyer specialising in business law, describing the state and enforceability of these clauses in Australia.

Re:non competes only make sense when...

[b4upoo]

Florida pretty much does what you state. Generally the non compete clauses only hold water as long as the person remains employed. I do not know how a large lay off payment would effect this practice.
            The general idea being that a contract must continue to benefit both parties. When the employee is no longer paid the no compete is dead.

Re:California is right

[acomj]

Lots of companies. Although since the PC beat the mainframe there are fewer computer companies.

We have large offices for Raytheon, Parametrics, Solidworks, Comverse, Sigmatel, ..... uswusf.

All the major "California" companies have large offices here in MA too:
Sun/Oracle
Microsoft
Lotus/IBM
Hp
Symantec
Akami

In cambridge/boston its more Biotech (Amgen Novartus, pfizer )etc...

google is your friend

Re:Both arguments make sense

[AK Marc]

No fair signing the contract, taking the money and then crying about it later when you are expected to live up to the contract.

In CA, they put non competes in contracts all the time, even though they are essentially illegal (and anyone writing them in CA knows that). You can force "non compete" in that someone may not take something owned by the previous company, like a product or such, and use that at the new company for a competitive advantage. An illegal contract does not need to be honored. You can't sign yourself into indentured servitude. And a contract that specifies you can't work in the field you are most qualified in is not much different. That the companies like to have them to badger former employees with illegal contracts is all find and dandy. But in some areas, you aren't given a choice. You sign, or you starve (figuratively). So, you sign and expect the illegal contract to not be enforced.

On the other hand, companies are so willing to throw employees under the bus today that it is ridiculous to think they can interfere with you taking another job by claiming "IP" issues.

The company isn't claiming IP. MA is. MA claims that forced unemployment is ok because the risk that someone might accidentally share info with a competitor is too high. CA says that forced unemployment is illegal regardless of contract, just like indentured servitude is.