On April 23, 2024, the Federal Trade Commission voted 3-2 to approve a final rule banning all employee noncompetition agreements nationwide. The rule, currently set to go into effect 120 days after publication in the Federal Register (except for the notice provision which is effective earlier), is the result of the FTC’s position that
U.S. Supreme Court Holds that Arbitrator, Not State Court, Must Determine Enforceability of Noncompetition Agreement
In a per curiam opinion, the U.S. Supreme Court held that under the Federal Arbitration Act arbitrators, not courts,must determine the enforceability of covenants not to compete when the parties are subject to agreements that call for the mandatory arbitration of disputes.
In Nitro-Lift Technologies v. Howard, two employees left their employment with Nitro-Lift and began
Handling Texas Noncompetes After Marsh USA (Part 2)
In Part 1, I covered some thoughts on enforcing noncompetition agreements in Texas following the Texas Supreme Court’s new decision in Marsh USA. Today I’m addressing some tips that employees (and their representatives) who are asked to sign or are attempting to bust a noncompetition agreement might consider.
Prior to signing the agreement, negotiate everything
Handling Texas Noncompetes After Marsh USA (Part 1)
Yesterday, Ryan Miller and I were invited to speak at the Tarrant County Bar Association’s Labor and Employment Section luncheon. Our topic was the recent changes to Texas noncompete jurisprudence. A copy of the Power Point presentation we jointly presented can be accessed here.
For my contribution, I presented some thoughts on the practical effect the Marsh USA
Recruiters Beware of Candidates with Noncompetition Agreements
Yesterday Rob Radcliff over at the Smooth Transitions Law Blog wrote a post about a lawsuit filed by an attorney against the recruiter that placed him at his new law firm. In essence, the attorney alleged that the recruiter made representations that she was independent (and not tied to any particular law firm) and fraudulently convinced the
More Thoughts on Marsh USA v. Cook: Fundamental Changes in Texas Noncompete Law
I’ve had a chance to reread and digest the Marsh USA opinions over the weekend. For those looking for easy ways to set aside or void noncompetition agreements in Texas, Marsh USA is strike three. (Strike 1, Strike 2). The Texas Supreme Court has, in the past five years, taken Texas from
Does Texas Law Recognize a Claim against Competitor’s Poaching of Employee?
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
Dallas Court Strikes Physician Noncompete that Lacked Buy-Out Provision
I’ve previously written about the specific requirements that must be included in a covenant not to compete with a licensed physician to make the restrictive covenant enforceable. The Dallas Court of Appeals recently affirmed a trial court’s decision that a noncompetition agreement between a surgical practice and several limited-partner physicians was unenforceable because the agreement lacked one of the statutorily required
Appeals Court Holds Trial Court Must Conduct Evidentiary Hearing in Ruling on Temporary Injunction in Noncompete Case
A trial court’s order granting or denying a temporary injunction in a noncompete case is rarely reversed by the court of appeals. This week the Fourteenth Court of Appeals took the unusual step of reversing a trial court’s denial of an employer’s application for temporary injunction seeking to prohibit a former employee from engaging in certain
San Antonio Court of Appeals Holds Doctrine of Unclean Hands Doesn’t Invalidate Noncompetition Agreement
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).