Daily Archives: October 28, 2014

In order to uphold a covenant not to compete, a contract for sale of a business may not circumvent California’s deeply rooted public policy favoring open competition. Otherwise, the non-compete agreement is void. In this show, Bill and Rick discuss the requirement that there be a clear indication that in the sales transaction the parties value or consider goodwill as a component of the sales price, as well as the fact that a covenant not to compete be reasonable in terms of time, activity and territory covered. Likewise, the discussion will distinguish the viability of agreements involving the taking of proprietary material, or “trade secrets,” versus a non-compete agreement.