4 ms·

If that's the actual legal precedent set by these cases, then that's rather a big deal, no? California's limitations on noncompete clauses are quite strict, to

If that's the actual legal precedent set by these cases, then that's rather a big deal, no? California's limitations on noncompete clauses are quite strict, to the point of making noncompetes mostly worthless, but this is extending that to nonsolicits, and extending it to all 50 states. Regardless of what you feel about the case I think that's a huge change to the current ecosystem.

mbreese 13y ago
Non-competes are between an employee/employer. Non-solicits would be between companies, in this case competitors. At least they are competing over the same pool of employees. As such, it's likely viewed as collusion. This isn't a big of a change to the legal precedents. This type of behavior has been illegal for a long time. This is just the first time that I know of where it's been this public involving media-friendly companies.
- deleted 13y ago
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dragonwriter 13y ago
> California's limitations on noncompete clauses are quite strict, to the point of making noncompetes mostly worthless, but this is extending that to nonsolicits, and extending it to all 50 states. No, its not. The idea that nonsolicits are combinations in restraint of trade as prohibited by the Sherman Antitrust Act has nothing at all to do with the California legal rule against noncompetes -- its certainly not a generalization of that rule. > Regardless of what you feel about the case I think that's a huge change to the current ecosystem. Its fairly well established that agreements not to compete between firms are generally illegal under the Sherman Act; finding a new exception to that rule would be a bigger change to the current legal climate.
nknighthb 13y ago
15 USC Section 1, part of the Sherman Act, a federal law passed in 1890 over which California exercises no control: "Every contract, combination in the form of trust or otherwise, or conspiracy, in restraint of trade or commerce among the several States, or with foreign nations, is declared to be illegal." This applies as much to an agreement among companies not to compete for engineers as it would to an agreement among companies not to compete for any other limited good or service they need to do business. It applies in all states, and has for 124 years.
gojomo 13y ago
There's a necessary distinction to be made between non-solicitation pacts between companies - a definite antitrust concern - and the non-solicitation clauses in company-to-individual employment/separation agreements. The company-to-company pacts are suspect enough, as some of the messages in these cases show, that executives feared creating a paper trail. The company-to-employee agreements are different. Those clauses typically limit an individual from recruiting coworkers to a new employer, for a limited time. As far as I know, these are legal in most places, apparently even in California, and aren't done surreptitiously at all: they're clearly spelled out in employment-related contracts. (Some of the Pando reporting, in trying to cast some Google documents in the worst possible light, seems confused on this matter. They call a passage that's clearly referring to such employee contractual obligations to former employers as a "a rather cryptic warning suggesting that all across industries, illegal non-solicitation agreements were common everywhere" and "a stunning example of… flagrantly illegal practices". No, that's just referring to a common and legal non-solicitation clause of many employment agreements. See, for example, http://www.pepperlaw.com/publications_update.aspx?ArticleKey=408 http://www.pepperlaw.com/publications_update.aspx?ArticleKey... )
- kinofcain 13y ago
  Thanks, I was referring to some of the examples, where A manager moved to a different firm and pointed out the top engineers to the recruiters for targeting. That would seem to violate the more or less standard non-solicits that most of us sign, but it was referred to as behavior that companies could not agree to prohibit. That's what I was referring to in my comment above, that if companies can't agree to honor non-solicits, then the non-solicits seem to lose some teeth. Of course the original employer could go after the manager directly, but it certainly seems to weaken them.
Nursie 13y ago
Non-compete clauses are highly unethical anyway, IMHO.

mbreese 13y ago

Non-competes are between an employee/employer. Non-solicits would be between companies, in this case competitors. At least they are competing over the same pool of employees. As such, it's likely viewed as collusion. This isn't a big of a change to the legal precedents. This type of behavior has been illegal for a long time. This is just the first time that I know of where it's been this public involving media-friendly companies.

deleted 13y ago
[deleted]

dragonwriter 13y ago

> California's limitations on noncompete clauses are quite strict, to the point of making noncompetes mostly worthless, but this is extending that to nonsolicits, and extending it to all 50 states. No, its not. The idea that nonsolicits are combinations in restraint of trade as prohibited by the Sherman Antitrust Act has nothing at all to do with the California legal rule against noncompetes -- its certainly not a generalization of that rule. > Regardless of what you feel about the case I think that's a huge change to the current ecosystem. Its fairly well established that agreements not to compete between firms are generally illegal under the Sherman Act; finding a new exception to that rule would be a bigger change to the current legal climate.

nknighthb 13y ago

15 USC Section 1, part of the Sherman Act, a federal law passed in 1890 over which California exercises no control: "Every contract, combination in the form of trust or otherwise, or conspiracy, in restraint of trade or commerce among the several States, or with foreign nations, is declared to be illegal." This applies as much to an agreement among companies not to compete for engineers as it would to an agreement among companies not to compete for any other limited good or service they need to do business. It applies in all states, and has for 124 years.

gojomo 13y ago

There's a necessary distinction to be made between non-solicitation pacts between companies - a definite antitrust concern - and the non-solicitation clauses in company-to-individual employment/separation agreements. The company-to-company pacts are suspect enough, as some of the messages in these cases show, that executives feared creating a paper trail. The company-to-employee agreements are different. Those clauses typically limit an individual from recruiting coworkers to a new employer, for a limited time. As far as I know, these are legal in most places, apparently even in California, and aren't done surreptitiously at all: they're clearly spelled out in employment-related contracts. (Some of the Pando reporting, in trying to cast some Google documents in the worst possible light, seems confused on this matter. They call a passage that's clearly referring to such employee contractual obligations to former employers as a "a rather cryptic warning suggesting that all across industries, illegal non-solicitation agreements were common everywhere" and "a stunning example of… flagrantly illegal practices". No, that's just referring to a common and legal non-solicitation clause of many employment agreements. See, for example, http://www.pepperlaw.com/publications_update.aspx?ArticleKey=408 http://www.pepperlaw.com/publications_update.aspx?ArticleKey... )

kinofcain 13y ago
Thanks, I was referring to some of the examples, where A manager moved to a different firm and pointed out the top engineers to the recruiters for targeting. That would seem to violate the more or less standard non-solicits that most of us sign, but it was referred to as behavior that companies could not agree to prohibit. That's what I was referring to in my comment above, that if companies can't agree to honor non-solicits, then the non-solicits seem to lose some teeth. Of course the original employer could go after the manager directly, but it certainly seems to weaken them.

Nursie 13y ago

Non-compete clauses are highly unethical anyway, IMHO.