Thanks for all the advice. Several of you mentioned that you think non-competes are illegal in Calif and that never occured to me. So after some searching, I found that they are indeed illegal in CA with a few exceptions (none my case).
Good article about non-compete agreements:
California Supreme Court Nixes Most Non-Compete Agreements
Also, for purposes of this law, employees and independant contractors are the same.
The most ironic thing about this, is that I offered to renegotiate and pay him 15% of gross revenue for 6 months (for this particular client), and he "respectfully declined". Now I'm going to offer him Zero!