David Jacobs, a member of the firm’s Labor and Employment and Litigation practices in the firm’s Los Angeles office, explained in the July 17, 2007, issue of Variety the status of non-compete clauses in the state of California, which has been one aspect of a dispute between the International Creative Management agency and its former co-president Ed Limato.
The article, “ICM, Limato Nearing Deal,” concerned how talks by ICM and Limato to reach a settlement agreement on Limato’s departure as co-president were being hampered by a non-compete clause in Limato’s contract.
Jacobs noted that restrictive covenants are largely unenforceable in California because of California state law.
Limato’s contract runs through 2010, and he and ICM are also working on settling terms over commissions that ICM hopes to share for deals Limato will make for celebrity clients. Jacobs also said an attempt by ICM to restrict Limato’s future commissions would also run counter to state law, which favors employees.