Customer Non-Solicitation Agreements in California After Section 16600

Last updated: November 2026

A customer non-solicitation agreement in California is generally not enforceable against a former employee. A contract restraining anyone from engaging in a lawful profession, trade, or business is void to that extent, and courts have treated a ban on soliciting a former employer's customers as such a restraint. (Bus. & Prof. Code, § 16600, subd. (a).) A court can still enjoin a former employee from using trade secret information to identify or solicit customers. Kolmogorov Law, P.C. litigates these disputes in Orange County, Los Angeles, and across California.

Call (909) 235-6116 or contact us online to discuss a non-solicitation clause you want to enforce or have been accused of breaching.

The rule under section 16600

Section 16600 voids contracts that restrain a person from engaging in a lawful profession, trade, or business, except as the chapter itself provides. Since 2024 the statute has also said that it must be read broadly, consistent with the Supreme Court's 2008 decision in Edwards v. Arthur Andersen, to void any non-compete agreement in an employment context no matter how narrowly tailored. (Bus. & Prof. Code, § 16600, subds. (a), (b)(1).)

Edwards involved an accountant barred for a period from serving or soliciting clients of his former firm's office. The Supreme Court held the clause invalid because it restrained his profession and rejected any exception for narrow restraints. The Legislature wrote that holding into the statute.

Customer non-solicits fall on the void side of the line for a simple reason: for a salesperson, a broker, a recruiter, or an accountant, soliciting customers is the profession. A clause that forbids it restrains the trade.

The trade secret line

The Court of Appeal drew the distinction that governs these cases. Section 16600 bars a court from enforcing by injunction a contractual clause that bans a former employee from soliciting former customers. But a court may enjoin tortious conduct by banning the former employee from using trade secret information to identify existing customers, to facilitate soliciting them, or otherwise to compete unfairly. The conduct is enjoinable not because of an exception to section 16600 but because it is wrongful independent of any contract. (The Retirement Group v. Galante (2009) 176 Cal.App.4th 1226, 1238.)

So the question is rarely whether the clause is enforceable. The question is whether the former employee is using a trade secret. A customer compilation built over years, with contact persons, pricing history, and account needs, can qualify. A list of customers anyone could identify from public sources cannot. Our article on what courts treat as trade secrets in client lists draws that line in detail.

One more distinction matters. Using a protected client list to solicit clients directly violates the trade secret statute. Merely announcing a new business affiliation to those same clients, without more, does not; the Supreme Court has described that announcement as basic to the right to compete fairly. (Reeves v. Hanlon (2004) 33 Cal.4th 1140 [17 Cal.Rptr.3d 289, 300-301].)

Exceptions that survive

The statutory exceptions are about ownership, not employment. A person who sells the goodwill of a business, or an owner who sells an entire ownership interest in a business entity, may agree with the buyer to refrain from carrying on a similar business in a specified area. The restraint lasts as long as the buyer carries on a like business there. (Bus. & Prof. Code, § 16601.) A customer non-solicit given by the seller as part of that sale, limited to the customers of the business sold, is generally treated as within that exception. Parallel provisions let partners and LLC members agree to the same kind of restraint on dissolution or on leaving the entity. (Bus. & Prof. Code, §§ 16602, 16602.5.) Our page on buying or selling a small business covers that setting.

How these disputes arise

An insurance agency's top producer leaves for a competitor with a one-year customer non-solicit in her agreement. Within a month, accounts she handled begin moving. The agency wants to enforce the clause; the clause is void. The case turns on whether she took the agency's renewal dates and premium data or simply called people who knew her.

A commercial printer sells the business, signs a five-year non-solicit in the purchase agreement, and opens a new shop across town eighteen months later. That clause rests on the sale of goodwill and is likely enforceable within its geographic scope.

A staffing firm sends a demand letter to a former recruiter citing a customer non-solicit, and the recruiter's lawyer responds that the firm has committed a civil violation by attempting to enforce a void contract. (Bus. & Prof. Code, § 16600.5, subd. (d).) The demand letter has created a claim against the firm.

What a California employer can do instead

The tools that work are the ones aimed at information rather than at competition. A confidentiality agreement that defines customer data as confidential, access controls that limit who can export the customer database, and an exit protocol that recovers devices and collects a certification. Our page on reasonable measures to protect trade secrets explains the program.

Where the former employee is using protected information, the remedies are an injunction against the use, damages for the diverted business, and in willful cases exemplary damages and attorney fees. (Civ. Code, §§ 3426.2, subd. (a), 3426.3, 3426.4.)

Employers should also review their agreement templates. Including a void non-compete clause in an employment contract is itself unlawful, and attempting to enforce one is a civil violation that entitles a prevailing employee to attorney fees. (Bus. & Prof. Code, §§ 16600.1, subd. (a), 16600.5, subds. (d), (e).) The non-compete guide covers the 2024 changes. For clauses aimed at recruiting coworkers, see our page on employee poaching.

Where these cases are heard

Non-solicitation disputes are filed in the Superior Court, at the Central Justice Center in Santa Ana for Orange County and the Stanley Mosk Courthouse for Los Angeles. A trade secret claim under the federal statute can place the case in the Central District of California.

What to bring to the first meeting

Bring the agreement containing the clause, the employee's role and the date of departure, evidence of what customer information the employee could access and whether any was taken, and the communications with customers since the departure. If you are the former employee, bring the demand letter, the agreement, and an honest account of what you have and whom you have contacted.

Frequently asked questions

Are customer non-solicitation agreements enforceable in California?

In the employment context, generally no. A clause that bars a former employee from soliciting the former employer's customers restrains the employee's trade and is void under section 16600. (Bus. & Prof. Code, § 16600, subd. (a).) A court can still enjoin the use of trade secret information to solicit those customers, which is a different claim.

What is the trade secret exception to non-solicitation agreements?

It is less an exception than a separate rule. A court cannot enforce the contractual ban on solicitation, but it can enjoin a former employee from using trade secret customer information to identify or solicit customers, because that conduct is wrongful regardless of the contract. (The Retirement Group v. Galante (2009) 176 Cal.App.4th 1226, 1238.)

Can a former employee contact my customers?

Yes, unless the contact uses your trade secrets. Announcing a new affiliation is permitted. Calling through a copied customer database with pricing and renewal information is not. The line depends on what information the employee used.

Is a non-solicit in a business sale agreement enforceable?

Usually, if it is tied to the sale of goodwill or of the seller's entire ownership interest and is limited to the area where the business operated. (Bus. & Prof. Code, § 16601.) The exception protects what the buyer paid for and does not extend to ordinary employees.

Can I be sued for trying to enforce a non-solicit?

Yes. An employer that attempts to enforce a contract that is void under the chapter commits a civil violation, and a prevailing employee or former employee recovers reasonable attorney fees and costs. (Bus. & Prof. Code, § 16600.5, subds. (d), (e).)

Talk to a California employment litigation attorney

If a former employee is soliciting your customers, or you have received a demand letter citing a non-solicit clause, call (909) 235-6116 or contact us online. Kolmogorov Law, P.C. is at 327 Magnet, Irvine, CA 92618, and represents businesses in Orange County, Los Angeles, and throughout California. See also our employment litigation page.

This page provides general information about California law and is not legal advice. Outcomes depend on the agreement, the information actually used, and the court.