The California Law of Unfair Competition Takes a Turn--Against the Employer

Abstract

M ANY attorneys, accustomed to identifying unfair competition with some of the better known and more numerous decisions of the federal courts, may be unaware that California has developed a sizable case law of her own dealing with the subject. This is particularly true of litigation arising out of a master-servant relationship formerly existing between the parties. The writer believes there have been recent developments in this field of unusual interest and significance; and that the subject itself is one which will, sooner or later, confront any lawyer engaged in the general practice. On July 8, 1952, the Supreme Court of California formulated a rule which, it seems reasonable to believe, could make a common type of unfair competition case several times harder for the plaintiff. The situation involved is that of the former employee with an intimate knowledge of his former employer's customers, business operations and trade secrets, going out to compete with his old boss, and possibly putting him out of business. The case is Aetna Building Maintenance Co. v. West.' While a portion of the opinion appears to effect a substantial change in what many of us doubtless thought to be the law, and accentuates a trend, it has still another aspect of unusual interest: the opinion incorporates a curious error, or, to be most conservative, an ambiguity which may prove quite troublesome to both bench and bar.