Legal Question in Business Law in California

Advice on counter-complaint of ex-employer

My partner and I have recently come under suit by our x-employer for launching a startup company while working for them. Their suit is groundless, but have been told that ''all'' civil cases go to trial, regardless of merit.

New company ''is not'' a competitor, but they are suing anyway. No signed ''competition agreements'' and we were ''at will'' employees. Are there any GOOD counter-complaints to answer their complaint? We learned that we can't even file for Attorney's Fees unless our counter-complaint involves some particlar issues. When our x-employer learned who our ''independent programmer'' was, sent a threatening email to him, causing him to abandon the contract he had with us. We had to pay an attorney to ''convince'' the programmer to hand over the work he had done for our new company. The only counter-complaint that we can think of is ''their interferance with our ''contracted'' programmer, which caused us to hire (more $$) a new programmer to finsih the job.

I'm trying to find out if there are ANY other grounds for counter-complaint besides this 1 issue. How about grounds of this company filing such a groundless lawsuit, causing us grief and expense? Any counter there? Anything else I could be missing? Thank you


Asked on 9/15/03, 4:31 pm

8 Answers from Attorneys

Bryan Whipple Bryan R. R. Whipple, Attorney at Law

Re: Advice on counter-complaint of ex-employer

You need to pay more attention to defending and treat your proposed counteroffensive as job two. Whether you were "at will" or not, your former employer has a claim on your time and productivity while you're on its payroll. Further, the former employer is probably making trade-secret related claims.

Assuming you've been served with a summons and complaint, you need to file an answer within the allowed 30-day period. If you were sued as individuals (your question does not say you are a corporation), you could in theory appear and defend in pro. per., but that would be a mistake.

Sorry to be less optimistic than the other six responses, but you guys need to get ready for what may turn out to be a long and expensive battle, one which you may lose if the former employer has some good issues with you. A lawyer who will level with you rather than feed you encouragement and hype will be more helpful in the long run.

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Answered on 9/16/03, 4:43 am
Donald Holben Donald R. Holben & Associates, APC

Re: Advice on counter-complaint of ex-employer

Good Morning:

You have been misinformed in several areas. First, few lawsuits go to trial and in California, non-competition restrictions are greatly disfavored. There are various causes of action that may allow for recovery of attorney's fees. Please call to discuss. Don Holben 800-685-6950

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Answered on 9/16/03, 11:05 am
Joel Selik www.SelikLaw.com

Re: Advice on counter-complaint of ex-employer

Possibly intentional interference with prospective economic advantage, intentional interference with contract, but the best suit, malicious prosecution will have to wait until you win this case.

JOEL SELIK

www.seliklaw.com

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Answered on 9/15/03, 4:38 pm
Larry Rothman Larry Rothman & Associates

Re: Advice on counter-complaint of ex-employer

Law suits claiming unfair business practices are hard to win from the Plaintiff's side and you may have a great cross-complaint for breach of contract. If B & P 17200 is alleged, you may be able to recover costs and attorney fees. Our law firm would be happy to review your documentation and provide you with consultation.

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Answered on 9/15/03, 4:44 pm
Jeffrey D. Olster Russakow, Ryan & Johnson

Re: Advice on counter-complaint of ex-employer

The only way to know whether you have any viable cross-claims against the ex-employer is to discuss your situation with an attorney. There are numerous potential theories, such as defamation or intentional intereference with business relations (eg, for the loss of your programmer), but until more facts are known, it is impossible to opine on your potential remedies.

Your ex-employer is wrong, of course, about civil cases going to trial. The overwhelming majority of civil cases do NOT go to trial, as the system is designed to ferret out meritless cases well in advance of trial. Nevertheless, as you now know, meritless lawsuits are in fact initiated all the time.

Feel free to call our office. We offer free initial telephone consulations.

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Answered on 9/15/03, 4:45 pm
Edward Hoffman Law Offices of Edward A. Hoffman

Re: Advice on counter-complaint of ex-employer

It is difficult to say exactly what causes of action you can allege because I would need to know more facts. By the same token, I cannot say whether I agree with you that the employer's suit is "groundless" based on what you have said.

As others have pointed out, there are a variety of causes of action which might work for you, including interference with prospective business advanatage and unfair business practices (the latter of which includes attorney fee provisions). I also agree with the prior response which explained that the vast majority of civil cases do not go to trial.

What I want to add to the prior responses is that, as a business entity, you will need to hire a lawyer to represent you. Your question makes it sound like you are planning to fight the case in pro per, but only individuals can do so. Since you need to get a lawyer anyway, you might as well find one and discuss your case with him/her face-to-face instead of seeking more limited guidance here.

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Answered on 9/15/03, 5:16 pm
Michael Olden Law Offices of Michael A. Olden

Re: Advice on counter-complaint of ex-employer

yes, the most important thing --- a good litigation attorney --- starting out or long term business are no different when it comes to protecting there rights both need good legal counseling for them to compete in todays market =-- yours is not the job of trying to determine what various causes of action have you missed unless you are an attorney trying to cover your ass-etts -- my advice pay a good attorney and he/she will be worth the money spent as amatures are not sucessful as i have seen in my 30 years of practice in the business area -- if you wish to consult with me 925-945-6000 as i am in the s.f. bay area --- if not find an attorney in your geografic location

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Answered on 9/15/03, 5:45 pm
Robert Miller Robert L. Miller & Associates, A Law Corporation

Re: Advice on counter-complaint of ex-employer

Thank you for your posting and your inquiry.

From your brief description, you have plenty of issues from which to form a counter-claim against this party. Unfortunately, what you've asked at the end of your question, if you can sue for "grief and expense" for bringing this lawsuit, you will have to file a separate claim for, if you win this case entirely and if it was found to be groundless. To name a few options:

1. Breach of contract;

2. Breach of good faith and fair dealing;

3. Interference with prospective business advantage;

4. Interference with contractual relations;

5. Defamation;

6. Tortious interference; and

7. Unlawful business practices.

I must echo the advisement you've already received that it would be well worth your while to sit with an attorney for a free consultation and go over more details and all your options here, even the more drastic ones.

I hope that this information helps you, but if you have further questions, want more information, or feel that you need legal representation, please feel free to email me directly at [email protected]. It's my pleasure to assist in any way that I can.

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Answered on 9/16/03, 3:20 am


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