Wow, these cases have become nearly impossible to win in California - the plaintiff's non-compete contract has to fit very narrow criteria. Only a handful of plaintiffs have won in the software non-compete era.
On the other hand, it's easy to slap a plaintiff back if this kind of lawsuit is found to have been filed without meri - and it California, almost all of these suits are now without merit.
If the contract in question mentions XBIZ by name, since XBIZ is AVN's only competitor in its niche, then AVN may have a case. Otherwise...industry lawyers are going to have another chance to feed at the aorta.
Terri