Unfair competition is a generalized term for business conduct that is contrary to honest practice in industrial or commercial matters.1

Misappropriation of trade secrets is one form of unfair competition,2 but the term encompasses a broader range of misconduct about confidential business information. Ultimately, the term “unfair competition” has no fixed meaning, but depends instead on the facts of each case.3

The case law suggests several limited instances in which relief can be granted against a former employee now in competition with you:

When an employee forms a competing business before resigning their employment4
In certain circumstances relating to soliciting customers
By disparaging your products or services, secretly diverting business to a competitor or soliciting only your preferred or most profitable customers5

1. American Heritage Life Insurance Co. v. Heritage Life Insurance Co., 494 F.2d 3 (5th Cir. 1974)

2. Klamath-Orleans Lumber, Inc. v. Miller, 87 Cal. App. 3d 458 (1978)

3. Grant v. California Bench Co., 76 Cal. App. 2d 706 (1946)

4. Bancroft-Whitney Co. v. Glen, 64 Cal. 2d 327 (1966)

5. Scavengers Protective Association v. Serv U Garbage Co., 218 Cal. 568 (1933)

Protecting Employer Information

Unfair Competition

Protecting Employer Information