Is it legal to start an independent business that is related to the company that I work for now?

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Is it legal to start an independent business that is related to the company that I work for now?

A buddy and I thought of an idea that will provide a service to a group of businesses that our employer deals with. Our employer cannot provide this service and we will not use company time or resources in any way to provide this service but we may not have known about the need for this service if we did not work for our employer. so my question is. Is it illegal to pursue this idea?

Asked on February 25, 2012 under Business Law, Arizona

Answers:

SJZ, Member, New York Bar / FreeAdvice Contributing Attorney

Answered 9 years ago | Contributor

1) If you have signed any non-competition or non-solicitation agreements (or broader employment agreements which contain such a term), check what those agreements say--that will largely (or entirely) determine what you can do.

2) You can't use proprietary information of your employer for your benefit--so, for example, you may not be able to specifically approach your current employer's customers if the only way to know of them, who to contact at them, etc. is through your company's customer files/database/etc.--though you can advertise, have a website, go to trade shows, etc. and if they approach you, that would be fine.

3) The use of proprietary information includes using what you know only as an employee of your current employer to do anything which might damage or undercut their business.

If you're not violating any agreements, you're not using some proprietary information, and you're not using any company resources or time, what you propose should be legal. Your employer may still choose to terminate you for doing this (if you haven't resigned first), but that's a different matter.


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