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Jonathan A. Patchen, left, and Cheryl A. Cauley, right, of Baker Botts.

Employee noncompete agreements are generally invalid under California Business & Professions Code §16600, which says that “every contract by which anyone is restrained from engaging in a lawful profession, trade, or business of any kind is to that extent void.” Courts have periodically created exceptions to §16600’s ban on anticompetitive covenants—from the so-called “trade secret exception” to, under Techno Lite v. Emcod, a “while employed” exception. 44 Cal. App. 5th 462 (2020); Dowell v. Biosense Webster, 179 Cal. App. 4th 564 (2009). But such exceptions violate the statute’s plain text and policy, and the California Supreme Court’s direction that §16600 “should not be diluted by judicial fiat.” Edwards v. Arthur Andersen, 44 Cal. 4th 947, 949 (2008). Just as courts have recognized that the “trade secret exception” does not square with Edwards, the same should be true for Techno Lite’s “while employed” exception.

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