Depending on the circumstances, the answer to this question could be worth millions of dollars.  It could also spell the difference between success and disaster: e.g., the possible collapse of the modern day on demand cyber economy (Uber, Lyft, grocery delivery, etc.)  Thus, every day scores of lawsuits are fought over this very point.  For many, the business of filing and prosecuting such lawsuits is “big business.”

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According to one scholar, “misappropriation of trade secrets” lawsuits are frequently used to crush start up competitors.  (James H. Pooley, The Uniform Trade Secrets Act: California Civil Code 3426, 1 Santa Clara High Tech. L.J. 193 (1985).)  This often occurs when a senior level officer, manager or employee leaves to form his or her own business.  Even though California law overwhelmingly favors competition—and does not require former executives or employees to magically “forget” everything they learned in their former positions— start up competitors are often falsely accused of stealing trade secrets simply because they continue to practice their trade or profession.  Hence the irony:  A tool designed to safeguard competition is often used to crush or destroy it.

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Until last year, California employers with five or more employees could pre-screen applicants using criminal background checks or by asking questions on a job application. A new law, however, called the Fair Chance Act (Govt. Code 12952) prohibits employers from asking applicants about criminal history before the employer makes a job offer. Employers are now limited to conducting criminal background checks only after making a job offer to an applicant.

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ECG would like to bring to your attention active email scams that malicious actors are distributing and the scam is creating emails that impersonate inside company personnel. Scammers do this to convince people to send money or gift cards to the sender.  Some are impersonating company personnel of authority, being so bold as to request wire transfers to be completed.  This often occurs by hackers associating the names of inside personnel to outside free email accounts, such as those set up on Gmail, Yahoo and AOL.  This type of scam is aimed at getting the recipient to transfer money or send sensitive information to a hacker acting as a trusted source. 

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Enterprise Counsel Group is pleased to announce that J. Michael Vaughn, a highly regarded corporate attorney with deep roots in Southern California’s diverse business community, is now an ECG shareholder. 

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