Noncompete Agreements in Texas

“Is my Texas Noncompete agreement enforceable?”

texas-noncompete-agreements

This is a question routinely asked by both employers and employees. Texas law disfavors contracts that restrict employee mobility. Texas courts acknowledge the substantial economic benefit in allowing people to change jobs and industries. But Texas law also recognizes that employers have valid interests–such as protecting their trade secrets and goodwill.

Balancing these interests, Texas law allows for noncompete agreements in some circumstances. A properly-worded noncompete – one which is related to a legitimate interest, such as trade secret protection, and which is reasonable in scope – can be enforceable. Even if a particular noncompete is enforceable, though, a court may decide not to force an employee to comply with it. The particular details of each agreement, and each situation, must be evaluated.

If you are party to a noncompete agreement, or have a legal matter involving a noncompete in Texas, contact us today.

Browse Texas noncompete and contract dispute articles, written by Attorney Robert Wood:

Possible Tort Claim Not Sufficient Consideration for Noncompete in Texas

March 2, 2016 / By Robert Wood
Articles // Noncompete Agreements in Texas

In recent years, Texas courts have shown support for the employer’s use of non-compete agreements. The courts have done so by finding certain requirements of enforceability implied in non-compete agreements in some circumstances. Despite this trend, in June 2015, the federal appellate court that covers Texas ruled that a duty to keep information confidential cannot…

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Money for a Noncompete in Texas?

February 26, 2016 / By Robert Wood
Articles // Noncompete Agreements in Texas

A Texas appellate court recently addressed the question of whether money is sufficient to support a non-compete agreement.  The court ruled that money was not enough and that the non-compete’s purpose must be to protect a legitimate business interest. The contract at issue was for a company (“Company A”) to provide hospitalist services and to…

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Texas Federal Court Voids Noncompete Agreement

November 25, 2015 / By Robert Wood
Articles // Noncompete Agreements in Texas

As readers of this blog know, noncompete agreements are increasingly enforceable in Texas.  However, even in Texas, not all noncompete agreements comply with the statutory requirements. In a case decided a few months ago, the United States Court of Appeals for the Fifth Circuit, applying Texas law, held that a particular noncompete agreement was unenforceable. …

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Texas Noncompete Agreements Must Be Reasonable in Scope

February 6, 2015 / By Robert Wood
Articles // Noncompete Agreements in Texas

Hiring employees, training them, and granting them access to industry secrets or client lists exposes employers to the possibility that employees will utilize this valued information against them.  In order to protect themselves, employers will often include a covenant not to compete provision in an employment contract, commonly known as a “non-compete.”  However, it is…

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Choice of Law in Texas Noncompete Litigation

January 8, 2015 / By Robert Wood
Articles // Noncompete Agreements in Texas

When contracting with another party, it is essential to understand which state law will govern your contract in the event you find yourself in a contractual dispute.  What might seem to be a reasonable provision, agreed upon by all parties, can be interpreted radically different depending upon the state law that will govern your contract. …

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A Rare Anti-Noncompete Case in Texas

November 18, 2014 / By Robert Wood
Articles // Noncompete Agreements in Texas

An employee of a small manufacturing company (“Acme Company”) leaves and starts his own competing company (“Best Company”). Acme Company sues the employee for doing so—because the employee signed a noncompete agreement stating that, if he left Acme Company, he would not start a competing business. In the lawsuit, the employee argues, “The existence of…

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