Texas Employment Law Update

Texas Employment Law Update

A Resource for Texas Employers

Category Archives: Trade Secrets

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El Paso Court of Appeals Clarifies Fiduciary Duty At-Will Employees Owe to Employers

Posted in Case Summaries, News & Commentary, Noncompetes and Restrictive Covenants, Trade Secrets
In Texas, absent a valid noncompete, an at-will employee is generally free to compete with the former employer so long as the employee does not take or use the company’s confidential information or trade secrets. Notwithstanding this general rule, employees also have common law fiduciary duties that limit what activities they can engage in prior to resigning… Continue Reading

When Does Preparing to Compete Become Unlawful Competition?

Posted in Noncompetes and Restrictive Covenants, Trade Secrets
In Texas, at-will employees can prepare to compete against their current employers without violating the common law duty of loyalty.  Determining whether the line between lawful preparation to compete and unlawful competition begins is sometimes gray.  (See post).  A recent case from the Houston Court of Appeals provides a good summary of what an at-will employee… Continue Reading

BREAKING NEWS: Texas Supreme Court Issues Opinion Enforcing Non-Compete Supported by Stock Options and Goodwill

Posted in Case Summaries, Human Resources, Noncompetes and Restrictive Covenants, Trade Secrets, Unemployment
The Texas Supreme Court has issued an opinion this morning holding that noncompetition agreements supported by stock options and good will are not unenforceable as a matter of law.  I previewed this case here.  As I have time to digest the majority, concurring and dissenting opinions, I’ll provide more thoughts on this case. You can… Continue Reading

Does Texas Law Recognize a Claim against Competitor’s Poaching of Employee?

Posted in Human Resources, Trade Secrets
Many times one competitor sues another competitor over the hiring or two or more employees (whether over allegations of a breach of contract or misappropriation of trade secrets), the Complaint will make allegations of employee "poaching".  This gives rise to the question about whether Texas recognizes a cause of action for one competitor’s poaching of another competitor’s… Continue Reading

San Antonio Court of Appeals Holds Doctrine of Unclean Hands Doesn’t Invalidate Noncompetition Agreement

Posted in Noncompetes and Restrictive Covenants, Trade Secrets
In an unpublished opinion, the San Antonio Court of Appeals held that a former employee cannot avoid the effects of a noncompetition agreement under the doctrine of unclean hands, as a matter of law, when the inequitable conduct the employee complains of is separate from the issue in dispute.  (Opinion available here).  In Central Texas Orthopedic Products,… 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