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Silicon Valley Innovation is Built Around Employee Mobility

In my last blog, I wrote about HP’s disturbing pattern of suing non-California employees under ‘non compete’ clauses, often imposed  years after employment began.  Apparently it’s relatively recently that HP decided to abandon its Silicon Valley roots and tie up its  non-California employees in legal knots.  HP is in fact the only large Silicon Valley-based company to have two classes of employees and try to impose mobility restrictions on those who live outside California.  HP’s efforts have gone so far as to sue an employee who took a buyout after having his salary cut, and one who didn’t even work in an area related to HP’s products that compete with Cisco’s.

Two recent actions since that blog posting are stunning.   First, HP renewed legal action in Texas, where one of the employees used to live, trying to get a judge there to schedule a court date on a day’s notice and to apply Texas law even though the California judge in the case is going to hold a hearing, as is certainly appropriate, to verify that the employee has in fact moved to California. (Yes, he came to work for Cisco after he arrived in California, rented an apartment, got a drivers license, etc.) Once again the Texas court refused to intervene, and in fact effectively “stayed” HP’s legal actions indefinitely. HP also tried in Texas to raise another bar to employee freedom, claiming that the employee would ‘inevitably’ use HP’s trade secrets to do his job at Cisco, and therefore should be barred from continuing his new job. Just as California law bars enforcement of non-compete clauses, California courts won’t recognize this doctrine either, seeing it for what it is — an effort to impose de facto non competition clauses.

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