I once read that California non-compete laws come from the gold rush era, and yet I was not able to find any more information about the subject.
It would be interesting to understand what historical circumstances led California to have these non-compete laws which many of the other US states don't have. (and why those states don't have such laws)
Thank you in advance for any answer whatsoever.
Overview
California's prohibition on non-competition clauses was part of the Civil Code it adopted in 1872 which was written predominantly by David Dudley Field II, whose first major accomplishment was drafting a significant overhaul and codification of civil procedure rules for New York State a couple of decades earlier that was widely emulated and became the standard framework for civil procedure until the Federal Rules of Civil Procedure were adopted in the 1930s.
He was heavily influenced by European civil codes and by criticism of the common law system. He was an anti-slavery Democrat who later became a Republican and represented (unsuccessfully) the leader of the Tammany Hall's leader Boss Tweed who was the epitome of corrupt machine politics in a trial of the century class criminal case.
Another reference that can be reviewed is David S. Clark, "The Civil Law Influence on David Dudley Field's Code of Civil Procedure", in Mathias Reimann (ed), The Reception of Continental Ideas in the Common Law World: 1820–1920 (1993) 63–87.
Long Answer
Only three states ban employee noncompetes: California (since 1872, see Edwards v. Arthur Andersen LLP, 44 Cal. 4th 937, 945 (2008)); North Dakota (since 1865—before North Dakota was even a state, see Werlinger v. Mut. Serv. Cas. Ins. Co., 496 N.W.2d 26 (N.D. 1993)); and Oklahoma (since 1890—before Oklahoma was a state, see Brandon Kemp, “Noncompetes in Oklahoma Mergers and Acquisitions,” 88 Okla. B.J. 128, 128 (2017)).
(Source)
The cited California case at the page cited states:
Under the common law, as is still true in many states today, contractual restraints on the practice of a profession, business, or trade, were considered valid, as long as they were reasonably imposed. (Bosley Medical Group v. Abramson (1984) 161 Cal.App.3d 284, 288.) This was true even in California. (Wright v. Ryder (1868) 36 Cal. 342, 357 [relaxing original common law rule that all restraints on trade were invalid in recognition of increasing population and competition in trade].) However, in 1872 California settled public policy in favor of open competition, and rejected the common law “rule of reasonableness,” when the Legislature enacted the Civil Code. (Former Civ. Code, § 1673, repealed by Stats. 1941, ch. 526, § 2, p. 1847, and enacted as Bus. & Prof. Code, § 16600, Stats. 1941, ch. 526, § 1, p. 1834; Bosley, supra, 161 Cal.App.3d at p. 288.)Footnote 3.
Today in California, covenants not to compete are void, subject to several exceptions discussed briefly below.
Footnote 3: "Prior to oral argument, we granted Andersen’s request that we take judicial notice of various documents providing information on the history of section 16600 and its predecessor statutes. (Evid. Code, §§ 452, 453, 459.)"
Wikipedia summarizes the 1872 adoption of the Civil Code in California as follows:
The Civil Code of California is a collection of statutes for the State of California. The code is made up of statutes which govern the general obligations and rights of persons within the jurisdiction of California. It was based on a civil code originally prepared by David Dudley Field II for the state of New York (but which was never enacted in that state). It is one of the 29 California Codes and was among the first four enacted in 1872.
Though the Code is organized in a manner similar to the inherited Colonial Spanish and Mexican Civil Law civil codes, many of its provisions are codifications of well-established American common law principles. For example, it contains a definition of consideration, a principle in the common law of contracts which has no direct equivalent in civil law systems. Similarly, it codifies the mailbox rule that communication of acceptance is effective when dropped in the mail, which is a feature unique to the common law.
First adopted in 1872 and signed into law by then Governor Newton Booth, the Civil Code is divided – similarly to its civil law analogues – into four divisions: "the first relating to persons"; "the second to property"; "the third to obligations"; "the fourth contains general provisions relating to the three preceding divisions." Division One contains laws which govern personal rights while Division Two contains laws which govern property rights. Division Three codifies the substantive contract law of the State of California as well as various regulations relating to agency, mortgages, unsecured loans, extensions of credit, and other areas of California law. Division Four defines remedies available in lawsuits, what constitutes a nuisance, various maxims of jurisprudence, and other miscellaneous provisions which relate "to the three preceding divisions."
Although revolutionary for its time, the California Civil Code was actually the third successfully enacted codification of the substance of the common law. The first was the Code of Georgia of 1861 (largely based on the work of Thomas Reade Rootes Cobb independent of Field), which is the ancestor of today's Official Code of Georgia Annotated. Then Dakota Territory beat California to the punch by becoming the first jurisdiction to enact Field's civil code in 1866.
David Dudley Field II's audacity in trying to codify all of the general principles of the common law (including the law of property, domestic relations, contracts, and torts) into general statutory law in the form of a civil code was extremely controversial in the American legal community, both in his time and ever since. Most U.S. states (as well as most other common law jurisdictions) declined to pursue such an aggressive codification. The Restatements of the Law were developed in the 20th century as a compromise between those who felt the common law was a disorganized mess and those who valued the flexibility and richness of the common law. Only California, North Dakota, South Dakota, and Montana enacted virtually all of Field's civil code, while Idaho partially enacted the contract sections but omitted the tort sections. Later, Guam borrowed much of the California Civil Code for its own legal system.
Justice Stephen Johnson Field (who was David Field's brother and was largely responsible for introducing his work to California), praised the California Codes (including the Civil Code) as "perfect in their analysis, admirable in their arrangement, and furnishing a complete code of laws," while English jurist Sir Frederick Pollock attacked the Civil Code as "about the worst piece of codification ever produced" and called it "the New York abortion" (since it was never enacted in that state).
What was David Dudley Field II's agenda? According to this Wikipedia article:
After having practiced law for several years, Field became convinced that the common law in America, and particularly in New York state, needed radical changes to unify and simplify its procedure. 1836 was particularly devastating for Field: his first wife, youngest child, and one of his brothers all died in the same year. To cope with his grief, he paused his law practice, traveled to Europe for over a year and focused on investigating the courts, procedure, and codes of England, France and other countries. He then returned to the United States and labored to bring about a codification of its common law procedure. Upon returning, he also established his own law firm, in which he was joined by his brothers Stephen and Jonathan.
Much of Field's ideas on codification and the civil procedure rules were based on the 1825 Louisiana Code of Procedure. The Louisiana code was drafted by jurists including Edward Livingston, Louis Lislet (1762–1832), and Pierre Derbigny. In turn, the Louisiana code was inspired by French (including the French Code of Civil Procedure of 1806), Spanish, and Roman law, the common law tradition, and Livingston's Louisiana Practice Act of 1805. European civil law thus influenced American civil procedure, partially through the intermediary of Louisiana.
Livingston helped to prepare criminal and civil codes for Louisiana, and Field's personal papers at Duke University Libraries reveal that he had read Livingston's 1825 report on the Louisiana Civil Code. Field was also influenced by criticism of the common law by his law partner Henry Sedgwick, as well as lawyer William Sampson.
Field devoted more than 40 years to this codification project. He began by outlining his proposed reforms in pamphlets, professional journal articles, and legislative testimony, but met with a discouraging lack of interest. In 1846, Field's ideas gained wider notice with publication of a pamphlet, "The Reorganization of the Judiciary", which influenced that year's New York State Constitutional Convention to report in favor of a codification of the laws. In 1847 he finally had a chance to put his ideas into official form when he was appointed head of a state commission to revise court procedure and practice. . . .
In 1857, Field became chair of another state commission, this time for the systematic codification of all of New York state law except for those portions already reported upon by the Commissioner of Practice and Pleadings. In this work he personally prepared almost the whole of the political and civil codes. . . .
The codification, which was completed in February 1865, was adopted only in small part by the state of New York, but it served as a model upon which many statutory codes throughout the United States were constructed. For example, although Field's civil code was repeatedly rejected by his home state of New York, it was later adopted in large part by California, Idaho, Montana, North Dakota, and South Dakota, as well as the territory of Guam many years later. (Notably, Idaho largely enacted the contract sections of Field's civil code but declined to enact the tort sections) . . . Thanks to Field's brother, Stephen (who served in the California State Assembly and as California's fifth Chief Justice before being appointed to the U.S. Supreme Court), California bought into Field's codification project more than any other state. California first enacted a Practice Act in 1851 influenced by the Field Code, then in 1872 enacted Field's civil procedure, criminal procedure, civil, penal, and political codes as the first four California Codes (California merged Field's penal and criminal procedure codes into a single code). . . .
Field was originally an anti-slavery Democrat, and he supported Martin Van Buren in the Free Soil campaign of 1848. He gave his support to the Republican Party in 1856 and to the Lincoln Administration throughout the American Civil War.
Field was part of the team of defense counsel that William M. Tweed [a.k.a. "Boss Tweed"] assembled to defend himself during the first criminal prosecution of Tweed in 1873. Other members of the defense team included John Graham and Elihu Root. This first trial ended when the jury could not agree on a verdict. In a second trial in November 1873, Tweed received a sentence of twelve years in prison and a $12,750 fine from judge Noah Davis.
