Court rules arbitrator can't order employer to turn its computers over to competitor

There is a growing trend toward suing former employees who leave to work for a competitor. During one recent lawsuit filed against a departing employee, the former employer sought an order from the arbitrator directing the new employer to turn over its computer records to show what the employee might have taken with him. How much power does an arbitrator have to order you to turn your computer records over to a competitor? Can an arbitrator order a nonparty to respond to any discovery (i.e., fact-finding) subpoena? If an arbitrator makes such an order, what can you do? The California Court of Appeal recently considered those questions.

Employee leaves to work for competitor

Miguel Saldana is a former employee of Veeco Instruments, Inc., a technology company that manufactures equipment for use in the semiconductor industry. Before starting his employment with Veeco in September 2014, he signed an "Employee Confidentiality and Inventions Agreement," which contained an arbitration clause providing:

Any claim or controversy arising out of my employment or the cessation thereof, including any claim relating to this Agreement, shall be settled by binding arbitration, in accordance with the National Rules for Resolution of Employment Disputes of the American Arbitration Association [AAA]. . . . The arbitrator shall have the power to award any type of legal and/or equitable relief available in a court of competent jurisdiction.