Maas
Fillpoint, LLC v. Maas
Opinion
Lead Opinion
Fybel, J.
*1173 Opinion
Introduction
When Michael Maas sold his stock in Crave Entertainment Group, Inc. (Crave), to Handleman Company (Handleman), he signed a stock purchase agreement, which contained a three-year covenant not to compete. As part of Handleman’s acquisition of Crave, Maas—a Crave employee—also signed an employment agreement containing a one-year covenant not to compete, which would become operative when Maas’s employment with Crave was terminated. Maas resigned from Crave three years after its acquisition by Handleman. About six months later, he began working for Solutions 2 Go, Inc., a competitor of Crave, owned by Nima Taghavi.
Fillpoint, LLC (Fillpoint), which had acquired Crave from Handleman, sued Maas for breaching his employment agreement, and also sued Solutions 2 Go and Taghavi for interference with contract. (Maas, Solutions 2 Go, and Taghavi will be referred to collectively as defendants.) The trial court granted defendants’ nonsuit motion; we affirm.
Under the general rule in California, covenants not to compete are unenforceable. To protect an acquired business’s goodwill, an exception to this rule allows such covenants in connection with the sale of a…