Restrictive Covenants In California After Ixchel Pharma

By David Clark and Andrea Levenson (August 4, 2020, 5:18 PM EDT) -- The U.S. Court of Appeals for the Ninth Circuit in Ixchel Pharma v. Biogen recently certified to the California Supreme Court the question whether Section 16600 of the California Business and Professions Code voids a contract under which a business is restrained from engaging in a lawful trade or business with another business.[1] The certification was not surprising, particularly given California's aggressive approach to restrictive covenants combined with lingering questions following the 2008 seminal case of Edwards v. Arthur Anderson LLC.[2]

On Aug. 3, the California Supreme Court explained that the primary dispute in Ixchel was not whether Section 16600 applies...

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