Executive Direction is a contract employee staffing provider in San Francisco, founded by Fred Naderi.
EDI caused its employees to sign in my opinion one of the most blatant and outrageously illegal employment contract I have seen. After EDI sued to enforce the contract my client countersued, and included claims that the contract:
- Illegally prohibited employees from discussing their rate of pay in violation of Labor Code Section 232.
- Included an illegal non-compete agreement prohibiting employees from working for another employment agency, or for a client, within 6 months after their employment with Executive Direction ended, in violation of Business & Professions Code Section 16600.
- Illegally required employees to indemnify Executive Direction for any expenses and liabilities - just the opposite of what California law requires, in violation of Labor Code Section 2802.
When one of Executive Direction's employees left to work through a competing firm, Fred Naderi wrote to EDI's client, Wells Fargo Bank, in an attempt to get the former employee fired. My client said that in his correspondence Mr. Naderi repeatedly lied and defamed her.
During trial Fred Naderi admitted that he had no personal knowledge about defamatory statements he made about the employee, and he was impeached about various statements he made. For example, he had written that this 'is only the second time we have been forced to start any legal proceeding.' Trial then proceeded through what seemed like an eternity as over a dozen lawsuits Executive Direction has filed were listed, one by one.
After trial the court issued a tentative statement of decision against Executive Direction [ large PDF file ].
In short, Judge Mellon said he was finding that:
- Executive Direction had used an illegal non-compete contract
- Executive Direction had not established any damages
- Executive Direction did not have any trade secrets and a statute it tried to rely on had no application to the case
- Executive Direction illegally tried to get its former employee fired
- Executive Direction through its CEO Fred Naderi had made false statements that were intended to cause emotional and substantial financial harm, and that Executive Direction engaged in outrageous conduct.
As a result, the court's tentative decision levied damages against Executive Direction for $60,000.
Afterwards, the parties resolved their claims before Judge Mellon finalized his decision.
Read more about the Executive Direction - Fred Naderi Case