What are the problems with client solicitation for a formertax prep employee ifthey arestartingtheir own tax prep business?

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What are the problems with client solicitation for a formertax prep employee ifthey arestartingtheir own tax prep business?

My step-father is starting his own tax preparation business. He wants to take some of his clientsbut I feel like he can’t, or at the very least, he can’t solicit their business.

Asked on December 14, 2011 under Employment Labor Law, California

Answers:

SJZ, Member, New York Bar / FreeAdvice Contributing Attorney

Answered 9 years ago | Contributor

If he specifically targets clients whom he is aware of only because he worked at  the tax preparation business, then he is misappropriating their business information--their client list--and could potentially be liable to them for doing that. He can do a broad-based solicitation or marketing effort to people to the area they happen to serve, and if his former clients come to him, he'd fine so long as  he had not signed a non-competition or non-solicitation agreement; but using another business's client/customer list can result in liabiltiy.


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