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Edwards v. Arthur Andersen LLP

Supreme Court of California
81 Cal. Rptr. 3d 282 (Cal. 2008)


Facts

Raymond Edwards (plaintiff) signed a noncompetition agreement when he was hired as a certified public accountant by Arthur Andersen LLP (Andersen) (defendant). The agreement prohibited Edwards from providing professional services for any client for which he did work at Andersen for 18 months, as well as any client of Andersen’s Los Angeles office for 12 months. Edwards brought suit for intentional interference with prospective economic advantage and anti-competitive business practices. Edwards based his suit on California Business and Code section 16600, which stated that, with the exception of noncompetition agreements in the sale or dissolution of corporations, partnerships, and limited liability corporations, “every contract by which anyone is restrained from engaging in a lawful profession, trade, or business of any kind is to that extent void.” Andersen claimed that “restrained” should be construed to mean “prohibited.” The trial court found in favor of Andersen. The court of appeal reversed. Andersen appealed.

Rule of Law

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Issue

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Holding and Reasoning (Chin, J.)

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  • A "yes" or "no" answer to the question framed in the issue section;
  • A summary of the majority or plurality opinion, using the CREAC method; and
  • The procedural disposition (e.g. reversed and remanded, affirmed, etc.).

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