Weinstock

I would reverse because the trial court failed to rule whether the employment contract between NewLife Sciences, LLC, and Ronald Weinstock was void under Business and Professions Code section 16600, which provides that, “[ejxcept as provided in this chapter, every contract by which anyone is restrained from engaging in a lawful profession, trade, or business of any kind is to that extent void.” Rather, the trial court ruled that the contract, including the noncompetition clause, was enforceable as an issue sanction and never determined whether the provision was void or not.

NewLife Sciences claims that the noncompetition clause was lawful because it was part and parcel of the sale by Weinstock of the assets and goodwill of a business and thus enforceable under Business and Professions Code section 16601. That may turn out to be the case, but the trial court never decided the issue based on the evidence presented by NewLife Sciences, relying instead on a discovery sanction imposed on Weinstock.

“[0]ur courts have consistently affirmed that section 16600 evinces a settled legislative policy in favor of open competition and employee mobility. . . . The law protects Californians and…

Ronald Weinstock appeals from the trial court’s order granting a preliminary injunction in favor of NewLife Sciences, LLC (NLS), prohibiting Weinstock and other persons and entities from engaging in direct or indirect competition with NLS. We affirm.

BACKGROUND

I. First amended complaint and cross-complaint

NLS filed a first amended complaint against Weinstock 1 alleging that as its primary business, NLS manufactures, markets, and leases to physicians a pain relief device or machine called a therapeutic magnetic resonance device, or TMR. The Food and Drug Administration (FDA) had cleared the use of the device for certain medical purposes after NLS had acquired all the rights to the TMR; the use of the device without the supervision of a physician violated FDA rules.

Weinstock, the purported inventor of the device, obtained three patents related to the device and had another patent pending. Weinstock transferred the patent rights to Medico Enterprises, Inc. (Medico). On December 15, 2006, Weinstock, on behalf of himself and NLS, entered into a memorandum of understanding (MOU) with John Crosson. The MOU provided that Weinstock would assign the TMR patents to NLS. In…