What options do I have, and how should I proceed, regarding an alleged violation of an employment agreement?

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What options do I have, and how should I proceed, regarding an alleged violation of an employment agreement?

I received a letter titled NOTICE OF BREACH OF INDEPENDENT CONTRACTOR AGREEMENT AND DAMAGES: CEASE AND DESIST DEMAND from a past employer who I have worked for as an independendent contractor. During the term of the contract I began forming a semi-competing business and stopped reporting to work with them. There claim is that I am using proprietary information I received while working for them. This is not true. The new business is modeled after the dozens of other similar business like it around the country. No proprietary information is being used.

Asked on June 10, 2011 under Employment Labor Law, California

Answers:

M.T.G., Member, New York Bar / FreeAdvice Contributing Attorney

Answered 10 years ago | Contributor

The essence of your question centers around the law of non-compete agreements, correct?  Is that the basis of the cease and desist letter that you are violating your IC agreement by violating the non-compete portion or because you are using proprietary information (trade secrets) or both?  First off, non-compete agreements are illegal in California with two exceptions: 1.  non-compete agreements are enforceable for partnerships and 2. when someone is selling their ownership interest in a company.  A company can prevent the use of its trade secrets, but it cannot prevent fair competition.  So take all the agreements to an attorney to review on your behalf.  Have the attorney write a letter that is appropriate to the situation and take it from there.  Good luck.


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