Non-Compete Agreements in California

A topic that often arises in the context of a business is non-compete agreements. As the name should hopefully suggest, a non-compete agreement is a contract in which a party agrees not to engage in a lawful profession, trade, or business. A non-compete agreement might arise with two potential competitors agreeing to divide a particular market between them. Collusion like this is generally illegal on, among other things, federal antitrust grounds which are waaaaaay beyond the scope of this blog post. The more common scenario I encounter involving non-compete agreements is where the restriction is not voluntary. A common scenario would be where an employee works for an employer who, deep in the legalese of the papers the employee signed when they hired on, forbids the employee from either going to work for a competitor or opening up a competing business. In other words, if the employee is fired or quits, they can’t go continue in the same line of work. The vast majority of people have experience, training, etc in only one line of work so the employer’s restriction effectively means that they cannot make a living if they upset their employer. Can an employer impose restrictions like this on an employee? In California, the answer – in general – is no and it is because of Section 16600 of the California Business and Professions Code. Section 16600 states: 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. As with everything in the law, of course, there...

Clerk’s Arraignments for Misdemeanors in California Criminal Court

In California, arraignments are generally the first time that a criminal defendant makes their appearance in court. Every arraignment is slightly different because no two cases and no two courts are exactly the same. If you are facing misdemeanor criminal charges in California and want to learn more about what happens at an arraignment, I have video on my Youtube channel about it. Depending on the particular court you’re in, the judge you’re in front of, etc, you may have the option of doing something called a Clerk’s Arraignment instead. It is what it sounds like — you get arraigned in front of a court clerk (i.e. a non-judge who just works for the court) as opposed to an actual judge or court commissioner. Some of you might be going ‘Whoa, what? Is that legal?’ The answer is that it is, but – in my experience at least – it is not common. I would guess that I encounter it less than 10% of the time on misdemeanor cases. All of those are on cases where the defendant has his or her own attorney (i.e. not the public defender). I have never seen a Clerk’s Arraignment done in a case where the defendant is appearing without a lawyer. If you have, leave me a comment down below. There are many reasons why a Clerk’s Arraignment might be done. One is speed. For the vast majority of misdemeanor cases, arraignment is routine and uneventful for an attorney to do. Additionally, misdemeanors are very common so it is not unusual for an attorney to wait in line for 45 or more...

California Cooks Selling Directly to the Public

It used to be that if you liked to cook, you had to open a restaurant in order to make money off of your cooking. There’s the food truck route, of course, but soon, there will be another option in California: you can sell food you make in your home kitchen directly to the public. If you’re interested in doing this, the law behind this is actually quite involved. I’ll mention some sections of the California Health and Safety Code below, but the basic idea involves the creation of something California calls a “microenterprise home kitchen operation” (CA Health and Safety Code section 113825). There are other code sections that will specify how a “microenterprise home kitchen operation” will fit in to the existing law that governs food, restaurants, food preparation, etc. And, of course, there are going to be laws that specify how microenterprise home kitchen operations will be regulated by the city or county they’re located in and several sections of the Health and Safety Code (e.g. Section 114367) will be devoted to that. Microenterprise Home Kitchen Operation (MHKO) This will be defined in section 113825 of California’s Health and Safety Code. An MHKO has nine criteria: It doesn’t have more than one full-time employee. Family members and household members don’t count. Food is prepared, cooked, and served on the same day. Food is either (1) consumed onsite, or (2) offsite if the consumer picks the food up or is delivered Food preparation does not involved anything requiring a HACCP plan or the production, sale, or service of raw milk or milk products. HACCP stands for “Hazardous...

Female Directors on California Boards of Directors

Some of you might have heard that California recently¬†(less than 24 hours as of the time I write this)¬†passed a law that requires a certain number of directors on a corporation’s Board of Directors to be female. I’ve already gotten several inquiries about this new law and it’s been less than a day. In this post, I’m going to summarize what I think are the major pieces of the new law. It’s not going to be a comprehensive summary, of course as I cannot go over every possible aspect of any law. As always, I encourage you to do your own research, consult with your own legal counsel, etc. This new law arose as California Senate Bill 826 in the 2017-2018 regular session and does basically three things: It imposes a dual-level requirement for Boards of Directors with respect to female directors, It creates a publication requirement to disclose which companies are and are not in compliance, and It imposes fines for non-compliance. Dual-Level Requirement The news has basically described this new law as a requirement to have a certain number of female directors on a company’s Board of Directors. If you read the actual statute (California Corporations Code section 301.3), you’ll discover that there are actually two requirements, hence why I call it a “Dual-Level Requirement.” The first level is that as of the close of calendar year 2019, every corporation that has its Principal Executive Offices (PEO) in California must have at least one female director on its board. The PEO shall be determined based on what the corporation says in its annual 10-K filing to the...