USCA11 Case: 25-10388 Document: 26-1 Date Filed: 08/25/2025 Page: 1 of 14

[DO NOT PUBLISH] In the United States Court of Appeals For the Eleventh Circuit

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No. 25-10388 Non-Argument Calendar ____________________

NETROADSHOW, INC., Plaintiff-Counter Defendant-Appellee, versus LISA CARRANDI,

Defendant-Counter Claimant-Appellant.

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Appeal from the United States District Court for the Northern District of Georgia D.C. Docket No. 1:23-cv-05697-ELR ____________________ USCA11 Case: 25-10388 Document: 26-1 Date Filed: 08/25/2025 Page: 2 of 14

2 Opinion of the Court 25-10388

Before JORDAN, LUCK, and BLACK, Circuit Judges. PER CURIAM: NetRoadshow, Inc. (NetRoadshow) sued its former em- ployee Lisa Carrandi, arguing that she violated non-compete and confidentiality clauses in her employment agreement when she started working for a rival company. Carrandi asserted a counter- claim against NetRoadshow under a California statute that pro- vides a private right of action to employees when their former em- ployers attempt to enforce void restrictive covenants against them. The district court dismissed Carrandi’s counterclaim because it was governed by Georgia law based on a choice-of-law provision con- tained in the employment agreement, which meant that she could not assert a claim available only under California law. Carrandi appeals that dismissal. After review, 1 we vacate the district court’s dismissal of Carrandi’s counterclaim and remand for further pro- ceedings. I. BACKGROUND NetRoadshow is a company that provides “internet road- shows to the investment banking community and offers complete roadshow services for” various financial markets. Carrandi started working for NetRoadshow in 2005 as an account manager and was subsequently promoted to Senior Vice President of Strategic

1 We review de novo a district court’s dismissal for failure to state a claim.

See Roth v. Russell, 139 F.4th 879, 883 (11th Cir. 2025). USCA11 Case: 25-10388 Document: 26-1 Date Filed: 08/25/2025 Page: 3 of 14

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Accounts. Carrandi entered into an employment agreement with NetRoadshow, which contained multiple restrictive covenants, in- cluding non-compete and confidentiality clauses. The agreement also had a choice-of-law provision, which stated, “this Agreement and the rights of Company and Employee hereunder shall be gov- erned by and construed in accordance with the laws of the State of Georgia.” 2 In 2023, Carrandi resigned from her position at NetRo- adshow and soon after was hired by NetRoadshow’s competitor Finsight Group, Inc. (Finsight). NetRoadshow sued Carrandi in Georgia state court, arguing that Carrandi breached her employment agreement’s non-com- pete and confidentiality covenants by working for Finsight. Car- randi removed the action to federal court based on diversity subject matter jurisdiction under 28 U.S.C. § 1332. Carrandi also filed a counterclaim against NetRoadshow based on a California statute. She asserted that under the California statute the non-compete pro- vision in her employment agreement was void, and that she was entitled to (1) actual damages based on NetRoadshow’s attempt to enforce the void provision, and (2) an injunction prohibiting NetRoadshow from attempting to enforce the provision in the fu- ture. The California statute provides an employee with a cause of action against her former employer if it attempts to enforce a void

2 The agreement also contained a choice-of-venue clause, which stated, “the

parties agree that any appropriate state court sitting in Fulton County, Georgia or any Federal Court sitting in the Northern District of Georgia (Atlanta Divi- sion) shall have exclusive jurisdiction of any case or controversy arising under or in connection with this Agreement . . . .” USCA11 Case: 25-10388 Document: 26-1 Date Filed: 08/25/2025 Page: 4 of 14

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restrictive covenant in an employment agreement against her, which works in conjunction with another statutory provision that declares all non-compete clauses void with limited exceptions. See Cal. Bus. & Prof. Code §§ 16600, 16600.5(d), (e). 3 NetRoadshow moved for a preliminary injunction to en- force the relevant portions of the employment agreement. The district court at first granted the motion in part as to the non-com- pete clause and denied it as to the confidentiality clause. In analyz- ing NetRoadshow’s motion, the court concluded that Georgia state law controlled its interpretation of the employment agreement be- cause of the choice-of-law provision. Carrandi moved for recon- sideration, and, after an evidentiary hearing, the court vacated its earlier order and denied NetRoadshow’s preliminary-injunction motion because it found that NetRoadshow did not establish a sub- stantial likelihood that it would succeed on the merits of its breach-of-contract claim. In denying NetRoadshow’s motion, the court concluded that the non-compete clause was void under Georgia law because it was too broad and indefinite to be enforce- able. NetRoadshow moved to dismiss Carrandi’s counterclaim, arguing, among other things, that Carrandi could not assert a claim under California law because the employment agreement was con- trolled by Georgia law. On September 10, 2024, the district court

3 Cal. Bus. & Prof. Code § 16600.5(e) was enacted in 2024 during the course of

these proceedings. USCA11 Case: 25-10388 Document: 26-1 Date Filed: 08/25/2025 Page: 5 of 14

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granted NetRoadshow’s motion to dismiss.4 It concluded that Car- randi could not state a claim under § 16600.5(e) because Georgia law controlled the resolution of her counterclaim based on the agreement’s choice-of-law provision, which meant that she could not use California law to hold NetRoadshow liable. The court then granted summary judgment to Carrandi as to NetRoadshow’s breach-of-contract claim and entered final judgment. Carrandi appeals the dismissal of her counterclaim. II. DISCUSSION Carrandi raises two arguments on appeal. First, she argues that the district court erred in ruling that the employment agree- ment’s choice-of-law provision barred her from raising a claim un- der § 16600.5(e) because the district court previously ruled that the non-compete clause was void. Second, she argues that the district court erred by concluding that Georgia law controls her counter- claim because her § 16600.5(e) claim is beyond the scope of the choice-of-law provision. We address each argument in turn. A. Voidness Carrandi’s first argument is summarized as follows: The dis- trict court’s conclusion that the employment agreement’s non-compete clause was void rendered the choice-of-law provision void, so the court should not have found that the latter provision

4 Carrandi previously moved to voluntarily dismiss her counterclaim but sub-

sequently withdrew that motion. USCA11 Case: 25-10388 Document: 26-1 Date Filed: 08/25/2025 Page: 6 of 14

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precluded her from raising her California state law counterclaim. We disagree. As an initial matter, we note that we must apply Georgia state law to determine what substantive law governs Carrandi’s counterclaim because the district court was exercising diversity ju- risdiction. See Cassirer v. Thyssen-Bornemisza Collection Found., 596 U.S. 107, 115 (2022) (“According to long-settled precedent, a federal court sitting in diversity borrows the forum State’s choice-of-law rule.”). Carrandi’s argument is premised on the proposition that, under Georgia law, “if one restrictive covenant in an employment agreement is found unenforceable, then all covenants in that agree- ment are struck down along with it, even if they might otherwise have been valid.” In support of this position, Carrandi cites to Ad- vance Tech. Consultants, Inc. v. Roadtrac, LLC, 551 S.E.2d 735 (Ga. Ct. App. 2001). Carrandi’s argument is incorrect because it relies on an inaccurate description of the principle described in Advance Tech. Consultants and is otherwise inconsistent with applicable precedent. In Advance Tech. Consultants, the Georgia Court of Appeals considered three restrictive covenants in a contract between a sup- plier and distributor that precluded the distributor’s right to solicit the supplier’s clients in a competitive manner. Id. at 735-36. The court held that one of the non-solicit covenants was unenforceable because it was overbroad. Id. at 738. It then explained that, be- cause “Georgia does not employ the ‘blue pencil’ doctrine of sev- erability,” if one of the non-solicit covenants was unenforceable, USCA11 Case: 25-10388 Document: 26-1 Date Filed: 08/25/2025 Page: 7 of 14

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then all of the restrictive covenants were automatically invalidated. Id. at 737-39. However, Advance Tech. Consultants does not stand for the proposition that if a non-compete clause is ruled unenforce- able, then a choice-of-law provision in the same contract is auto- matically invalidated. See id. Therefore, this case does not support Carrandi’s argument. Further, the Georgia Court of Appeals has explained that a void restrictive covenant does not automatically invalidate an en- tire contract when the parties clearly intended for the contract to be severable, that is, when the parties intended that “the remaining contract provisions will survive even if one or more provisions of the contract are void.” Early v. MiMedx Grp., Inc., 768 S.E.2d 823, 827 (Ga. Ct. App. 2015); see also Capricorn Sys., Inc. v. Pednekar, 546 S.E.2d 554, 558 (Ga. Ct. App. 2001) (“Void restrictive covenants, which cannot be blue-penciled5 out of the contract, do not void the entire contract when the contract contains a severability clause . . . .”). Carrandi’s employment agreement contains a severability clause, which states, In the event that any one or more of the provisions, or parts of any provisions, contained in the

5 In 2011, the Georgia General Assembly amended the statute governing re-

strictive covenants to permit blue-pencilling, but that amendment only applies to contracts entered into on or after May 11, 2011, and so does not control Carrandi’s employment agreement, which was entered into in 2005. See Early, 768 S.E.2d at 827 n.9. USCA11 Case: 25-10388 Document: 26-1 Date Filed: 08/25/2025 Page: 8 of 14

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Agreement shall for any reason be held to be invalid, illegal, or unenforceable in any respect by a court of competent jurisdiction, the same shall not invalidate or otherwise affect any other provision hereof, and this Agreement shall be construed as if such invalid, illegal, or unenforceable provision had never been contained herein. Under Early, because the agreement contains a severability clause, the district court’s conclusion that the non-compete clause was void did not automatically invalidate the choice-of-law provision. See Early, 768 S.E.2d at 827; Capricorn Sys., 546 S.E.2d at 558. Thus, Carrandi is incorrect that the choice-of-law provision does not gov- ern her counterclaim merely because the district court ruled that the non-compete clause was void. B. Scope Carrandi’s second argument is that the district court erred in concluding that Georgia law controlled her counterclaim because the choice-of-law provision in the employment agreement was lim- ited to the agreement itself and not to any tort claims that arose from the agreement, including her § 16600.5(e) claim. We agree. Georgia courts will enforce choice-of-law provisions “unless application of the chosen law would be contrary to the public pol- icy or prejudicial to the interests of this state.” CS-Lakeview at Gwin- nett, Inc. v. Simon Prop. Grp., Inc., 659 S.E.2d 359, 361 (Ga. 2008). However, the applicability of a choice-of-law provision to a claim for relief depends on the scope of the provision and the nature of the claim. In Young v. W.S. Badcock Corp., the Georgia Court of USCA11 Case: 25-10388 Document: 26-1 Date Filed: 08/25/2025 Page: 9 of 14

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Appeals held that, even though the contract that was the subject of the dispute before it contained a choice-of-law provision stating that Florida law governed, Georgia law controlled the plaintiffs’ tort claims that arose from the contract. 474 S.E.2d 87, 88 (Ga. Ct. App. 1996). The choice-of-law provision stated, “[t]his Agreement and the terms hereof shall be governed by and construed in accord- ance with the laws of the State of Florida.” Id. The court reasoned that Georgia law governed the plaintiffs’ tort claims because the choice-of-law provision did not “state that any and all claims arising out of the relationship between the parties shall be governed by Florida law.” Id.; see also Baxter v. Fairfield Fin. Servs., Inc., 704 S.E.2d 423, 428 (Ga. Ct. App. 2010). Under Young, to determine whether the choice-of-law provi- sion in Carrandi’s employment agreement controls her counter- claim, we must consider (1) whether the scope of the provision ex- tends to tort claims that arise from the agreement, and (2) whether Carrandi’s counterclaim sounds in tort or contract. See Young, 474 S.E.2d at 88. As to the first issue, we conclude the choice-of-law provision before us is analogous to the provision in Young. Like in Young, the choice-of-law provision in Carrandi’s employment agreement does not “state that any and all claims arising out of the relationship between the parties shall be governed by [Georgia] law.” See id. Rather, it merely states, “this Agreement and the rights of Company and Employee hereunder shall be governed by and construed in accordance with the laws of the State of Georgia,” and it does not include any language suggesting that Georgia law would cover tort claims arising out of the contractual relationship USCA11 Case: 25-10388 Document: 26-1 Date Filed: 08/25/2025 Page: 10 of 14

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between Carrandi and NetRoadshow. The phrase “and the rights of Company and Employee hereunder” does not distinguish this case from Young because the word “hereunder” indicates that the provision is limited to claims based on the specific rights and duties established by the agreement, that is, contract claims. Moreover, nothing in the provisions suggests that it extends to claims that arise from the agreement but are based on rights and duties exter- nal to the agreement, that is, tort claims. Applying Young, we conclude that the choice-of-law provi- sion in Carrandi’s employment agreement does not apply to tort claims that arise from the agreement. Therefore, the provision does not require the application of Georgia law to Carrandi’s coun- terclaim if the claim sounds in tort. In determining whether a claim that arises from a contrac- tual relationship sounds in contract or tort, Georgia courts look to the source of the legal duty that is the asserted basis for liability. If the asserted duty is derived from the terms of a contract, then the claim sounds in contract, but if the asserted duty is derived from a source external to the contract, such as a statute, then the claim sounds in tort. See Com. Bank & Tr. Co. v. Buford, 243 S.E.2d 637, 638-39 (Ga. Ct. App. 1978) (“If there is no liability except that aris- ing out of a breach of the express terms of the contract, the action must be in contract, and an action in tort cannot be maintained. Only where private duties arise from statute or flow from relations created by the contract, express or implied, may one elect to pursue [a tort action] for damages flowing from the exercise or failure to USCA11 Case: 25-10388 Document: 26-1 Date Filed: 08/25/2025 Page: 11 of 14

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exercise that duty.”); Peterson v. First Clayton Bank & Tr. Co., 447 S.E.2d 63, 67 (Ga. Ct. App. 1994) (“A tort is the unlawful violation of a private right other than a breach of contract, . . . but private duties may arise from statute, or flow from relations created by contract, express or implied. The violation of any such specific duty, accompanied with damage, gives a right of action (in tort).” (quotation marks and citation omitted)); GEICO Indem. Co. v. White- side, 857 S.E.2d 654, 661 (Ga. 2021) (explaining that a claim that “as- serts extra-contractual liability . . . sounds in tort”); Young, 474 S.E.2d at 88-89 (explaining that plaintiffs alleging a breach of a duty set forth in a statute are entitled to recover in tort). Applying this principle, we conclude that Carrandi’s coun- terclaim sounds in tort. Her claim is based on a California statute that provides a private cause of action to employees against whom a former employer attempts to enforce a void restrictive covenant in an employment agreement. See Cal. Bus. & Prof. Code § 16600.5(d), (e). In other words, the asserted basis for liability is derived not from the terms of the employment agreement but from a source external to the agreement, so the counterclaim sounds in tort. 6 See Com. Bank & Tr. Co., 243 S.E.2d at 638-39; Pe- terson 447 S.E.2d at 67; GEICO Indem. Co., 857 S.E.2d at 661; Young,

6 NetRoadshow argues that Carrandi’s counterclaim does not sound in tort

because the definition of a tort claim stated in O.C.G.A. § 51-1-8 requires that the claim be a violation of a private duty “accompanied by damage.” See O.C.G.A. § 51-1-8. We disagree because the issue of whether a plaintiff has adequately established damages goes to the merits of a claim rather than its classification as a tort or contract claim. USCA11 Case: 25-10388 Document: 26-1 Date Filed: 08/25/2025 Page: 12 of 14

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474 S.E.2d at 88-89. For that reason, the choice-of-law provision does not require that Georgia law govern Carrandi’s counterclaim. Therefore, the district court erred by dismissing Carrandi’s coun- terclaim on the basis that the choice-of-law provision required the application of Georgia law to that claim. C. Other Arguments However, the analysis does not end there. Just because the choice-of-law provision does not require the application of Georgia law to Carrandi’s counterclaim does not necessarily mean that Cal- ifornia law governs the claim. It is still necessary to apply Georgia’s general choice-of-law precedent to determine what state’s substan- tive law controls the counterclaim. To determine which state’s law controls a tort claim, Geor- gia courts apply the doctrine of lex loci delicti. See Auld v. Forbes, 848 S.E.2d 876, 879 (Ga. 2020). Under that doctrine, “a tort action is governed by the substantive law of the state where the tort was committed.” Id. (quotation marks omitted). The place where the tort was committed, or, the lo- cus delicti, is the place where the injury sustained was suffered rather than the place where the act was com- mitted, or, as it is sometimes more generally put, it is the place where the last event necessary to make an actor liable for an alleged tort takes place. Id. (quotation marks omitted). The last point in that quote is par- ticularly relevant for “torts of a transitory nature.” See Int’l Bus. Machs. Corp. v. Kemp, 536 S.E.2d 303, 306 (Ga. Ct. App. 2000). USCA11 Case: 25-10388 Document: 26-1 Date Filed: 08/25/2025 Page: 13 of 14

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Applying this doctrine, to decide which state’s law governs Car- randi’s tort counterclaim, it is necessary to determine “where the last event necessary to make [NetRoadshow] liable” under § 16600.5(e) took place. See Auld, 848 S.E.2d at 879 (quotation marks omitted). Even if California was the state where the last event neces- sary to make NetRoadshow liable under § 16600.5(e) took place, that still does not necessarily require that California law governs Carrandi’s counterclaim. Georgia courts recognize a public policy exception to lex loci delicti, under which courts “will not apply the law of the place where the injury was sustained if it would conflict with Georgia’s public policy.” Id. at 880 (quotation marks omit- ted). “[T]he public policy exception applies only if the out-of-state law is so radically dissimilar to anything existing in [Georgia’s] sys- tem of jurisprudence that it would seriously contravene the policy embodied in Georgia law.” Id. (quotation marks omitted). “A mere difference in law is not sufficient to justify this exception.” Id. Rather than engage in this analysis or assess NetRoadshow’s alternative arguments regarding the text of the California statute and the constitutionality of applying it extraterritorially at this time, we think it best to let the district court address these issues in the first instance, as it did not reach them in its order dismissing Carrandi’s counterclaim. See Singleton v. Wulff, 428 U.S. 106, 121 (1976) (“The matter of what questions may be taken up and re- solved for the first time on appeal is one left primarily to the discre- tion of the courts of appeals, to be exercised on the facts of USCA11 Case: 25-10388 Document: 26-1 Date Filed: 08/25/2025 Page: 14 of 14

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individual cases.”); Callahan v. U.S. Dep’t of Health & Hum. Servs., 939 F.3d 1251, 1266 (11th Cir. 2019) (concluding that issues, “which are unavoidably fact-sensitive, should be addressed first by the dis- trict court”). III. CONCLUSION The district court erred by dismissing Carrandi’s counter- claim because the employment agreement’s choice-of-law provi- sion does not require that Georgia law govern the counterclaim. Therefore, we vacate the district court’s dismissal of Carrandi’s counterclaim and remand for the district court to decide in the first instance whether Georgia or California substantive law governs the counterclaim and to address the fact-sensitive issues inherent in applying the California statute. VACATED AND REMANDED.