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Anne_C
Anne_C, Attorney
Category: Business Law
Satisfied Customers: 2302
Experience:  Business litigator, 15 years' experience
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California Ex-employer has served a cease and desist order ...

Customer Question

California Ex-employer has served a cease and desist order based on a boiler plate non-compete contract. Claiming aggressive contact with former students for new location, claiming voluntarily leaving his employ (not true - was fired while out of country-didn't know job was terminated). And that new location is within radius of mileage limitation in non-compete. Understand that California Business Code Section 16600 makes this type of non compete contract illegal. There was no partnership. Just employee/employer relationship. Employer did not serve other ex-employees that were also fired and now employed within radius and competing locations. The claims ex-employer makes on the cease and desist order are not valid. Also stating there is a $100,000 fine for non-compliance. Can ex-employer enforce such a false allegation in California? Also, the cease and desist order was not signed by the attorney and it is a fax copy. This sounds like a personal attack. Very tired of the harassament.
Submitted: 6 years ago.
Category: Business Law
Expert:  jdhaas replied 6 years ago.
I understand your frustration.

Unfortunately, to truly resolve this, you probably need to hire an attorney to get this case in front of a judge as quickly as possible. Whether that is you suing this person or allowing this person to sue you. The court will interpret the validity of the non-compete and if the non-compete is eliminated, the rest of the case will fall. Furthermore, if this person is really filing a frivolous case, this person and his or her lawyer may be sanctioned or penalized for their actions in this case. A capable attorney will be able to resolve this within a short period of time. You will have to pay attorney fees, but you will get this threat removed once and for all. Good luck.

I hope that I have helped you and that I have answered all of your questions. Please
ask more questions if I have not answered all of your questions.

Please be aware that my answer is not legal advice, it is merely information.
You and I have not entered into an attorney/client relationship, and I am not
responsible for your legal rights. The only way for us to be in an
attorney/client relationship is if you have signed a written retainer agreement
with my law firm.
Customer: replied 6 years ago.
Reply to jdhaas's Post: Would like to have response from expert in
California Business/Labor Law.
In re-reading the letter from ex-employer attorney...the only Demand is
to immediately cease and desist from contacting any current or former students of the Studio, or in any manner soliciting their business.
I even changed all my contact media and the former students do run into me at public social events. I can't help that. I also can't help that they find, through other sources where I am and show up. I understand that in California Business Law Section 16600, it is ok to tell people where I am working. I do not actively nor have I recruited former or current students. I waws not a partner in the business nor do I have any confidential addresses or phone numbers. This is why I really need a California based Expert in this.
Expert:  jdhaas replied 6 years ago.
I will opt out and send it to a California lawyer. Thanks.
Expert:  Anne_C replied 6 years ago.

Dear California:

Mr. Haas has opted out, so I will be offering my input on your questions.

As you already know, covenants not to compete are unenforceable in California. The "radius" doesn't make a difference. The exception is if there is a sale of a business, which did not happen here.

Furthermore, for an "Cease and Desist" order to be valid and enforceable, it needs to be issued by a Judge, not an attorney or certainly not your former employer.

In addition, your former employer can't impose a "fine" of anything; fines are criminal in nature, not civil.

I don't know if your employer's headquarters is someplace else than California; covenants not to compete are valid in most other states, and "radius" is an issue.

A strongly worded letter from an attorney (with a mention of malicious prosecution if your former employer tries to sue) should knock the nonsense off.

Good luck.

Anne_C, Attorney
Category: Business Law
Satisfied Customers: 2302
Experience: Business litigator, 15 years' experience
Anne_C and 10 other Business Law Specialists are ready to help you
Customer: replied 6 years ago.
Anne C - the attorney's letter did say that if I did not respond within 7 days the would seek an
injunction? against me. Thanks for your response.
I had no idea that the fine of $100,000 was criminal not civil law.
Expert:  Anne_C replied 6 years ago.

Dear California:

People can file lawsuits, even if the lawsuits don't have merit. However, a Court isn't going to grant injunctive relief to enforce a provision of a contract that is invalid and unenforceable in California.

With respect to a "fine" of $100,000, a "fine" is criminal in nature. Sometimes contracts have something called "liquidated damages", which is a pre-set monetary remedy for a breach of contract. Liquidated damages can be recovered if there is a breach of an enforceable contract. However, since the attorney is using the term "fine", he or she is doing so to scare you.

By the way, your current employer may have insurance available that would provide a defense to you if you are sued by your former employer. You may want to check with your employer to see if this is available to you.

An attorney could write a letter for you, explaining that covenants not to compete are unenforceable in California -- and the attorney can demand that your former employer and his or her attorney stop threatening you. The attorney could also include a warning that if the employer's attorney insists on filing litigation, the attorney could be subject to sanctions under Code of Civil Procedure Section 128.5, 128.6 and 128.7. That's basically a warning from an attorney to an attorney that their action does not have merit; and that if the attorney does file the action, the attorney could have monetary liability for filing the action.

Good luck.

Anne_C, Attorney
Category: Business Law
Satisfied Customers: 2302
Experience: Business litigator, 15 years' experience
Anne_C and 10 other Business Law Specialists are ready to help you

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