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March 1, 2013Charles M.R. Vethan

The Development of the Texas Non-Compete: a Tortured History

A recent article in the New York Times reported the State of Texas hands out more incentives than any other state; around $19 billion a year, to lure the most dynamic businesses in the United States to the Lone Star State. The governor of Texas stated that "Facebook, eBay, Apple – all of those within the last two years have announced major expansion in Texas . . . . They’re coming because it is given, it is covenant, in the boardrooms across America, that our tax structure, regulatory climate and legal environment are very positive to those businesses." Although Texas offers tax incentives and a favorable business climate, high tech businesses may have, in the past, understandably been reluctant to relocate to Texas because of the prior anemic protection granted to businesses in the arena of non-competes. These businesses, one assumes, have no interest in training their best and brightest today, only to have them become competitors tomorrow.

August 23, 2024ronc

District Court Sets Aside FTC’s Rule Banning Non-Compete Agreements

From the Court's ruling: "For the reasons enumerated above, it is ORDERED that Ryan and Plaintiff-Intervenors’ Motions for Summary Judgment are GRANTED. (ECF Nos. 166, 168). Additionally, for the reasons the Court grants Plaintiffs’ Motions for Summary Judgment, the Court DENIES the FTC’s Motion for Summary Judgment. (ECF No. 184). The Non-Compete Rule, 16 C.F.R. § 910.1–.6, is hereby SET ASIDE and shall not be enforced or otherwise take effect on September 4, 2024, or thereafter."

November 12, 2023Caroline Harrison

Employment Non-Competes: State of Play

While 2022 featured many new state laws and court decisions concerning covenants not to compete in employment contracts, the state of non-competes in Texas saw no change. However, 2023 brought non-competes to the headlines nationally and created a lot of questions for business owners and employees regarding the continued enforceability of non-competes. As of the date of this article, non-competes are still enforceable in Texas. However, employers with employees in other states need to pay close attention to the state of play for non-competes in the state in which their employees reside. In addition, national assaults on non-competes have arisen from the proposed rule making by the Federal Trade Commission and the National Labor Relations Board. This article summarizes the factors to ensure anon-compete is enforceable in Texas and then discusses recent federal actions: the Federal Trade Commission proposed rule and the National Labor Relations Board memorandum.

November 8, 2020Zach Wolfe

Drafting the Bullet Proof Non-Compete

The basic principle of non-compete law is reasonableness, and that’s a pretty fuzzy concept. That means there will almost always be some argument that no matter how well the non-compete is drafted, it is unreasonable. Still, there are ways to draft a non-compete to maximize the chance that a court will enforce it later. So here are the key questions that come up when you’re drafting a typical Texas non-compete.

March 10, 2017Courtney Barksdale Perez, Janet Landry Smith

Non-Compete Case Update

This paper summarizes and discusses a number of recent Texas cases involving non-compete provisions.

November 10, 2017Julie A. Springer, Danielle Taylor

Changes in the Employment Law Landscape Under the New Administration

During the last year of his tenure, President Obama’s administration released a flurry of rule updates, regulatory changes, and enforcement guidances that significantly impacted numerous areas of employment law. Many of those changes were challenged in courts, and many of those challenges resulted in injunctions and further uncertainty. Fanning those flames of uncertainty, the Trump Administration halted some of those challenges in the court system and reversed course on other regulatory changes and guidances. The Trump Administration’s actions have already brought significant changes to the federal government’s approach to employment issues. In addition to his theme of de-regulation, the Trump Administration is also reversing course on several Obama-era initiatives and guidances. One thing is certain—the area of employment law is ever-changing and fluid with the new administration. This paper highlights some of the more important developments to date, and those that are likely to occur in the future.

November 18, 2016Joseph F. Cleveland Jr., Jared D. Wilkinson

Protecting Your Client's Information And Customer Relationships: The Intersection Of Non-Competes, Trade Secrets, And Employee Confidentiality Agreements

Although a variety of steps can be taken to protect trade secrets, the primary objectives of a trade secret program is to (1) identify the company’s valuable trade secrets and (2) prevent their public disclosure by making reasonable efforts under the circumstances to maintain their secrecy. Each company has its own unique needs and requirements. Thus, whatever trade secret program is adopted and implemented must be tailored and should complement the company’s existing methods of operation, employment structure, and third party relationships.

May 11, 2012Steve Schortgen, Jennifer Klein Ayers

Texas Covenants Not to Compete: Shedding Light on a Marshy Landscape

Last December, in a controversial decision, the Texas Supreme Court significantly altered the requirements that an employer must meet to enforce a covenant not to compete in Texas. Marsh USA Inc. v. Cook, 354 S.W. 3d 764 (Tex. 2011). The Court‘s decision in Marsh made noncompete clauses easier to enforce and continued its recent trend favoring such agreements. See, id. at 774–75 (discussing the Court‘s holdings in Alex Sheshunoff Management Services, L.P. v. Johnson, 209 S.W.3d 644,651 (Tex. 2006) and Mann Frankfort Stein & Lipp Advisors, Inc. v. Fielding, 289 S.W.3d 844 (Tex. 2009)).