Texas Employment Law Update

Texas Employment Law Update

A Resource for Texas Employers

Category Archives: Noncompetes and Restrictive Covenants

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Texas Appellate Court Continues Trend of Enforcing Noncompetition Agreements

Posted in Noncompetes and Restrictive Covenants
Since the Texas Supreme Court’s Sheshunoff and Mann Frankfort opinions, Texas appellate courts have, with increasing frequency, enforced covenants not to compete in the employment context.  Gone are the days when noncompetition agreements were difficult to draft and enforce in Texas. In Gallagher Healthcare Insurance Services v. Vogelsang, the First District Court of Appeals in Houston… Continue Reading

Texas Relaxes Requirements to Enforce Noncompetes Against Physician-Owners

Posted in Legislation, Noncompetes and Restrictive Covenants
In addition to containing reasonable restrictions as to time, geographic scope and scope of activity to be restrained, Texas imposes additional requirements for enforceable covenants not to compete with licensed physicians.  Those additional requirements include that the covenant:  not deny the physician access to a list of his patients whom he had seen or treated… Continue Reading

Dallas Court of Appeals Holds that Award of Stock Options to Employee May Not Be Sufficient to Support Covenant not to Compete

Posted in Noncompetes and Restrictive Covenants
In a recent opinion of the Dallas Court of Appeals, the Court held that an insurance brokerage and consulting service firm’s noncompetition and nonsolicitation agreement obtained in return for an award of stock options to an employee was unenforceable under Texas law. (See opinion here). Rex Cook was a long-term employee of Marsh USA, Inc. Prior to… Continue Reading

Reports of Corporate Espionage Between Competitors on the Rise

Posted in Noncompetes and Restrictive Covenants, Trade Secrets
Reports of corporate espionage appear to be on the rise.  According to U.S.A Today, Starwood Hotels recently sued the Hilton Hotel chain accusing it of stealing trade secrets to help it launch a rival luxury chain quickly and cheaply.  The WSJ.com reports that the lawsuit accuses the Starwood executives "smuggled more than 100,000 documents and electronic… Continue Reading

Covenants Not to Compete that Contain Implicit Promises to Provide Confidential Information are Enforceable

Posted in Noncompetes and Restrictive Covenants
On April 17, 2009, the Supreme Court of Texas continued its trend of finding ways to enforce covenants not to compete in the employment context.   In Mann Frankfort Stein  & Lipp Advisors, Inc. v. Fielding, the Court considered "whether a covenant not to compete in an at-will employment agreement is enforceable when the employee expressly promises… Continue Reading