This firm will analyze such agreements under current Texas law and assess the strengths and weaknesses of the terms. It will also explain the practical litigation expense and exposure of enforcing or breaching such agreements.
Q. I had an employee who refused to sign the noncompete agreement. She recently started competing against my company with my own customer list. Is there anything I can do?
Yes. Even if an employee refuses to sign a non-compete agreement, the employee still cannot walk off with confidential, proprietary or trade secret information to unfairly compete with the business. But an employer must take proactive measures to identify and protect such information. If such information was available to all employees, not kept under lock and key, not stamped “confidential” or was made available to the public, the company will be hard pressed to cry foul and pursue legal intervention. Going forward, the company should have employees sign non-compete agreements and limit access to confidential and trade secret information. Alternatively, if a company does not want to bar a former employee from the industry completely, the company may choose to have employees just sign confidentiality and no solicitation agreements. Various factors must be considered with either course of action and legal advice should be attained to fully understand the options.
Q. If a non-compete agreement is overbroad as to geographic scope or length of time an employee cannot compete, will a Texas court throw out the agreement?
Under Texas law, assuming a non-compete meets various requirements for being enforceable in the first instance, the Texas judge may choose to revise the terms of the non-compete to make them more reasonable. Employees mistakenly believe that overbroad non-competes are automatically considered invalid. This is simply not an accurate understanding of the law.