James McNairy and Robert Milligan Published in Cyberspace Lawyer
"New Ninth Circuit Case Acknowledges Trade Secrets Exception to Business and Professions Code Section 16600"

James McNairy and Robert Milligan’s article, "New Ninth Circuit Case Acknowledges Trade Secrets Exception to Business and Professions Code Section 16600," was published in the November 2008 issue of the Cyberspace Lawyer. In their article, the authors discuss a new Ninth Circuit case, Asset Marketing Systems (AMS), Inc. v. Gagnon, where the Ninth Circuit affirmed the district court's determination that Gagnon had granted AMS an implied, unlimited license to retain, use, and modify the software, thus destroying any trade secret status the code might have had. According to James and Robert, "In rejecting Gagnon's trade secret claim, the Court affirmed the district court's holding that the non-competition agreements signed by Gagnon's employees were invalid."

James and Robert explained that in this first post-Edwards published Ninth Circuit decision regarding Section 16600, the Court did not provide any specific analysis concerning the nature of the trade secrets exception and what one must show to make defensible use of it. They furthered that "The Court's dicta appears to suggest that noncompetition agreements executed 'to protect' an employer's trade secrets will be enforceable. But as with most things legal, with trade secrets, the devil is in the details. What exactly the Court meant by a non-competition agreement to protect trade secrets is unclear. Further, mere assertions in employee/employer noncompetition agreements that the agreement has been executed 'to protect' trade secrets without more is unlikely to withstand challenge."