Noncompete Nonsolicit NDA Challenge Letters

Review your employment agreement, offer letter, or separation agreement and identify all restrictive covenants:

Use this flowchart to determine if your restriction is likely enforceable:

1. Is it a noncompete?
   • ✅ If you’re in California and not an owner/partner selling a business: VOID under § 16600
   • ⚠️ If the agreement specifies another state’s law, California courts will still apply § 16600 for CA residents/workers
2. Is it a customer nonsolicit?
   • ❌ Likely unenforceable under Edwards if it materially restrains your ability to work
   • ✅ Possibly enforceable if extremely narrow and tied to trade secret protection
3. Is it an employee nonsolicit?
   • ✅ Narrowly enforceable if limited to active poaching (not merely hiring former colleagues who apply on their own)
4. Is it an NDA?
   • ✅ Enforceable if it protects actual trade secrets and doesn’t function as a noncompete
   • ❌ Void if it prohibits disclosure of harassment, discrimination, or assault (SB 331)
   • ❌ Overbroad if it defines “confidential” to include general industry knowledge or skills

Even if a restriction could be enforceable in theory, it may be void if overbroad:

Assess your negotiating position:

• Strong leverage (employer unlikely to enforce):
  • You’re in California and the restriction is a noncompete or customer nonsolicit
  • The agreement is overbroad or vague
  • You didn’t receive meaningful consideration
  • The employer has a history of not enforcing these clauses
• Moderate leverage (uncertain enforceability):
  • Employee nonsolicit (narrow scope might be enforceable)
  • NDA that includes some trade secrets but also general knowledge
  • You’re moving to a role that arguably doesn’t compete
• Weak leverage (likely enforceable):
  • NDA covering clear, specific trade secrets (formulas, customer data, proprietary processes)
  • You actually plan to use or disclose trade secrets
  • You’re an owner/partner subject to a § 16601/16602 exception

Consider sending a pre-emptive challenge letter if:

• You’re planning to leave for a new job and want to clear the air before starting
• The employer has threatened to enforce the restriction
• You want to force the employer to commit to non-enforcement in writing
• You’re seeking a declaratory judgment that the restriction is void and want to show good faith

1. Identify the agreement: Reference the specific contract and restrictive covenant provision
2. State your position: Clearly state you believe the restriction is unenforceable and why
3. Legal basis: Cite California Bus. & Prof. Code § 16600, Edwards, SB 699, and any other applicable law
4. Factual support: Explain why you don’t fit the narrow exceptions (you’re not an owner, not selling a business, etc.)
5. Overbreadth arguments: Point out vague terms, excessive scope, lack of consideration
6. Request for confirmation: Ask employer to confirm in writing they will not enforce the restriction
7. Consequence of enforcement: Warn that you will seek declaratory relief, attorneys’ fees, and potentially damages under SB 699

[Your Name]
[Your Address]
[City, State, ZIP]
[Email]
[Phone]

[Date]

[Former Employer Name]
Attn: General Counsel / HR Director
[Company Address]
[City, State, ZIP]

Re: Noncompete Agreement – Notice of Unenforceability Under California Law

Dear [Employer]:

I am writing regarding the noncompetition provision in the [Employment Agreement / Offer Letter / Separation Agreement] I signed on [date] (the “Agreement”). Specifically, Section [X] of the Agreement purports to prohibit me from working for a competitor or soliciting customers of [Company] for [X years/months] following the termination of my employment.

I am writing to inform you that this provision is void and unenforceable under California law, and I will not be bound by it.

Legal Basis:

California Business & Professions Code § 16600 provides: “Except as provided in this chapter, every contract by which anyone is restrained from engaging in a lawful profession, trade, or business of any kind is to that extent void.” The California Supreme Court has made clear that § 16600 applies broadly to any restraint on an employee’s ability to compete, regardless of geographic or temporal limitations. Edwards v. Arthur Andersen LLP, 44 Cal. 4th 937 (2008).

The noncompete provision in our Agreement does not fall within any of the narrow statutory exceptions (§§ 16601, 16602, 16602.5), which apply only to owners selling a business or partners dissolving a partnership. I was a [W-2 employee / salaried employee] with no ownership interest in [Company], and I did not sell any business interest or goodwill. Therefore, § 16600 voids the noncompete in its entirety.

Moreover, California Senate Bill 699, effective January 1, 2024, makes it unlawful for employers to enter into or attempt to enforce noncompete agreements with employees. Employers who violate SB 699 face civil penalties and may be required to notify affected employees that the agreements are void.

Request for Confirmation:

I respectfully request that you confirm in writing, within 10 business days, that [Company] will not enforce or attempt to enforce the noncompete provision in the Agreement, and that I am free to accept employment with any employer of my choosing without restriction.

If I do not receive such confirmation, or if [Company] threatens to enforce the noncompete, I will have no choice but to seek declaratory relief in court. Under California law, I would be entitled to recover my attorneys’ fees and costs if I prevail. Additionally, any attempt to enforce this void provision may subject [Company] to penalties under SB 699.

I remain willing to honor any valid obligations under the Agreement, including the nondisclosure of legitimate trade secrets. However, the noncompete provision is not among them.

Please direct all communications to me at [email] or [phone].

Sincerely,

[Your Signature]
[Your Printed Name]

Re: Overbroad Nondisclosure Agreement – Request for Clarification

Dear [Employer]:

I am writing regarding the Nondisclosure Agreement I signed on [date]. While I acknowledge my obligation to protect [Company]’s legitimate trade secrets, I believe certain provisions of the NDA are overbroad and unenforceable under California law.

Specifically, the NDA defines “Confidential Information” to include “[broad definition, e.g., ‘any information related to the business’].” This definition sweeps in general industry knowledge, skills, and experience that I have acquired over the course of my career and that are not protectable trade secrets under the California Uniform Trade Secrets Act (CUTSA).

Under California law, an NDA cannot function as a disguised noncompete by prohibiting an employee from using general knowledge or skills in their profession. Edwards v. Arthur Andersen. To the extent the NDA purports to restrict me from working in [industry] or using skills I have developed, it is void under § 16600.

I request that [Company] clarify in writing which specific information it considers “trade secrets” subject to the NDA, so that I can ensure compliance while exercising my right to pursue my livelihood. I am happy to protect bona fide trade secrets, such as [specific examples: proprietary formulas, customer data not publicly available, etc.], but I will not be restricted from using general industry knowledge or skills.

Please respond within 10 business days. If [Company] takes the position that the NDA restricts me from working in [industry] or using general knowledge, I will seek declaratory relief.

Sincerely,
[Your Name]

• When to send: Ideally 2–4 weeks before starting a new job, giving the employer time to respond but not so much time they can prepare litigation
• How to send: Certified mail + email to General Counsel or HR Director
• Copies: Send to your new employer’s legal team (if applicable) so they’re aware of the issue

If the employer insists the restriction is valid, you can negotiate a release in exchange for:

• Payment: Employer pays you (e.g., 3–6 months’ salary) to release you from the restriction
• Narrowing the restriction: Limit geographic scope, duration, or definition of “competitor”
• Carve-out for specific employer: Employer agrees you can work for [New Company] without violating the agreement
• Standstill: Both parties agree not to sue while you work at the new job; if no problems arise in 6–12 months, employer releases you

Your new employer has a stake in this too (they’re hiring you). Many new employers will:

• Indemnify you (agree to cover legal fees if former employer sues)
• Provide legal counsel to defend against TROs or lawsuits
• Negotiate directly with the former employer to resolve the dispute
• Structure your role to avoid arguable competition (at least initially)

Inform your new employer’s legal team about the restrictive covenant before you accept the offer, so they can assess the risk and provide support.

If the employer refuses to back down, you can file a declaratory judgment action asking the court to declare the restrictive covenant void.

If the employer files for emergency injunctive relief, you must oppose vigorously:

1. Show § 16600 voids the restriction: Cite Edwards and argue employer cannot show likelihood of success on the merits
2. No irreparable harm: Employer’s harm (if any) is economic and can be remedied by damages; not a basis for injunction
3. Overbreadth: Highlight vague terms, excessive scope, lack of trade secret protection
4. Public policy: Enforcing the restriction would harm public policy favoring employee mobility
5. Unclean hands: If employer violated wage laws, harassed you, or acted in bad faith, argue they don’t deserve equitable relief

If the employer sues to enforce the restriction, raise these defenses:

If the employer sues you, consider counterclaiming for:

• Declaratory relief: Ask the court to declare the restriction void
• Attorneys’ fees: Under California Code of Civil Procedure § 1021.5 (private attorney general statute) or Civil Code § 1717 (contract fee-shifting)
• SB 699 penalties: If employer entered into or attempted to enforce a noncompete after Jan 1, 2024
• Unfair competition (Bus. & Prof. Code § 17200): Employer’s attempt to enforce void restriction is an unfair business practice
• Wrongful termination / retaliation: If employer fired you for refusing to sign restriction or for challenging it

Most noncompete disputes settle. Typical settlement terms:

• Release: Employer releases you from the restriction entirely
• Narrow carve-out: Employer agrees you can work for [specific company] or in [specific role] without violating the agreement
• Standstill: Both parties agree not to sue for X months; restriction expires or is waived if no issues arise
• Payment: Employer pays you to settle (often to cover your legal fees and as consideration for release)
• NDA carve-down: Employer narrows the definition of “confidential information” to exclude general knowledge

I represent employees in challenging noncompete, nonsolicitation, and overbroad NDA provisions. I provide strategic counsel from demand letters through trial, with a focus on securing your right to work and recovering attorneys’ fees from employers who attempt to enforce void restrictions.

• Agreement review and enforceability analysis: Detailed review of your restrictive covenants and assessment of enforceability under California law
• Pre-litigation challenge letters: Professional demand letters citing § 16600, Edwards, and SB 699 to prompt employer to back down
• Negotiation and settlement: Securing written releases or narrowed restrictions without litigation
• Declaratory judgment actions: Filing proactive lawsuits to declare restrictions void and recover attorneys’ fees
• TRO/injunction defense: Emergency opposition to employer’s attempts to enjoin you from starting new job
• Litigation and counterclaims: Defending against breach-of-contract claims and pursuing SB 699 penalties, fee-shifting, and UCL claims

1. Thorough legal analysis: I review every provision of your agreement to identify void restrictions, overbroad terms, and affirmative defenses
2. Strategic challenge letters: I draft persuasive demand letters that cite controlling California law and give the employer a face-saving way to back down
3. Proactive declaratory actions: If needed, I file declaratory judgment actions to seize the initiative and force the employer to defend the restriction on your turf
4. Aggressive TRO defense: If the employer seeks emergency injunctive relief, I respond immediately with strong § 16600 arguments and public policy defenses
5. Fee-shifting leverage: I use California’s fee-shifting statutes to create settlement pressure—employers know they’ll pay my fees if they lose