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Jeffrey S. Klein, left, and Nicholas J. Pappas, right, of Weil, Gotshal & Manges.

The state of California has long prohibited employers from enforcing non-compete agreements within the boundaries of that state. This prohibition has posed a significant challenge to employers with operations in California who seek to protect their goodwill and confidential information. Without the benefit of enforceable non-compete agreements, employers have been exposed to the risk of flight of their key talent. Employers have sought to protect themselves by using confidentiality agreements, customer non-solicitation agreements or other common law protections. However, these efforts often prove to be inadequate.

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