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Court Watch
In two recent cases, California state courts considered issues that have been the subject of federal court opinions interpreting California law. In both cases, there was no clear guidance from California courts on the issues prior to the federal decisions. Under appropriate circumstances, federal courts will apply state law to a dispute. In order to determine what the applicable state law may be, federal courts look first to state court cases. In the absence of definitive state court cases on the issue, a federal court will make its own interpretation of what it considers the applicable state law to be.
Federal courts had engrafted a “partial restraint” exception to California Business & Professions Code '16600's prohibition against covenants not to compete. In Edwards v. Arthur Andersen, LLP, 44 Cal.4th 937, 81 Cal.Rptr.3d 282 (Aug. 7, 2008) the California Supreme Court made clear that there is no such exception under Section 16600. The court considered the validity of a covenant against competition that restrained a former employee of the defendant from working for or soliciting certain clients of the defendant for a limited period following the termination of his employment. California Business and Professions Code '16600 prohibits contracts restraining anyone from engaging in a lawful profession, trade, or business except in limited circumstances prescribed by statute, such as upon the sale of a business, corporation, or limited liability company, or the dissolution of a partnership. However, federal cases interpreting California law had decided that there was also a “narrow restraint” exception to Section 16600 allowing a limited restraint on competition as long as it did not completely prohibit someone from practicing their profession, trade, or business. See Comedy Club, Inc. et. al v. Improv West Associates, et. al, 502 F.3d 1100 (9th Cir., 2007) amended 514 F.3d 833, (9th Cir., Jan. 23, 2008), discussed in Franchising Business & Law Alert, Oct. 2007, pages 5-6.
The DOJ's Corporate Enforcement Policy: One Year Later
The DOJ's Criminal Division issued three declinations since the issuance of the revised CEP a year ago. Review of these cases gives insight into DOJ's implementation of the new policy in practice.
The DOJ's New Parameters for Evaluating Corporate Compliance Programs
The parameters set forth in the DOJ's memorandum have implications not only for the government's evaluation of compliance programs in the context of criminal charging decisions, but also for how defense counsel structure their conference-room advocacy seeking declinations or lesser sanctions in both criminal and civil investigations.
Use of Deferred Prosecution Agreements In White Collar Investigations
This article discusses the practical and policy reasons for the use of DPAs and NPAs in white-collar criminal investigations, and considers the NDAA's new reporting provision and its relationship with other efforts to enhance transparency in DOJ decision-making.
Bankruptcy Sales: Finding a Diamond In the Rough
There is no efficient market for the sale of bankruptcy assets. Inefficient markets yield a transactional drag, potentially dampening the ability of debtors and trustees to maximize value for creditors. This article identifies ways in which investors may more easily discover bankruptcy asset sales.
A Lawyer's System for Active Reading
Active reading comprises many daily tasks lawyers engage in, including highlighting, annotating, note taking, comparing and searching texts. It demands more than flipping or turning pages.