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State Employment Law Articles
Report Link Texas Employers Get Another Favorable Opinion on Non-Competes.Jackson Lewis LLP - May 07, 2009 The Supreme Court of Texas has held that a non-compete covenant in an at-will employment agreement is enforceable when the employee expressly promises not to disclose confidential information, but the employer makes no express promise in return to provide confidential information. Mann Frankfort Stein & Lipp Advisors, Inc. v. Fielding, No. 07-0490 (April 17, 2009). The Court said the agreement may contain an “implied promise” to provide an employee with confidential information, thus the covenant is enforceable. Report Link Another Step Forward in the Enforcement of Noncompetes.Littler Mendelson, P.C. - April 27, 2009 The Texas Supreme Court in Frankfort Mann Stein & Lipp Advisors, Inc. v. Fielding has further clarified the circumstances in which noncompete contracts with at-will employees will be enforced that was first announced by the same court in Sheshunoff Management Services, L.P. v. Johnson. Report Link Restrictive Covenant Developments in 2008 (Texas).Elarbee, Thompson, Sapp & Wilson, LLP. - February 09, 2009 It is well known that Georgia and Texas are among the most difficult states in which to enforce a traditional non-compete agreement. Report Link Texas Employees May Be Required to Defend Non-Compete Claims In Other States.Jackson Lewis LLP - July 19, 2007 In another favorable opinion for employers seeking to enforce non-compete agreements against former employees, the Texas Supreme Court has held that case law barring Texas courts from invoking another state's law to interpret a Texas employee's non-compete agreement does not invalidate a clause saying that any lawsuits involving the agreement will be brought in a specified court of another state. Report Link Texas Employers Seeking to Enforce Non-Compete Agreements Get Welcome Relief.Jackson Lewis LLP - October 27, 2006 Since 1994, employers in Texas have been hamstrung by a decision of the state’s highest court which severely limited the enforceability of covenants not to compete in employment at-will relationships. Light v. Centel Cellular Co., 883 S.W.2d 642 ( Tex. 1994). In the twelve years since then, employers have attempted to find creative ways to circumvent the near absolute prohibition against having an enforceable non-compete agreement with an at-will employee. Following the precedent set by the Texas Supreme Court, many state courts subsequently rejected these attempts, finding that the resulting agreements were “illusory.” Report Link Texas Supreme Court Modifies Position - Upholds Non-Compete Covenant.Ford & Harrison LLP - October 25, 2006 Changing its prior position on the issue, the Texas Supreme Court has held that an employer’s promise to perform (for example, to provide training or confidential information) is sufficient to create an enforceable covenant not to compete in an at-will employment relationship; however, the non-compete covenant is not enforceable until the employer takes the action it has promised. Report Link Texas Supreme Court Provides New Focus for Noncompete Contract Enforcement.Littler Mendelson, P.C. - October 25, 2006 All employers have good reason to welcome the Texas Supreme Court's most recent ruling on noncompete contracts. Much of the confusion that made noncompete contract enforcement in Texas difficult to predict has been eliminated. In Alex Sheshunoff Management Services, L.P. v. Johnson, the Texas Supreme Court shifts the focus for noncompete contract analysis away from technical timing and contract formation issues that dominated recent decisions, and back to whether the contract is reasonable and necessary for the protection of a legitimate business interest. Lower courts were split on whether the Texas Covenant Not to Compete Act (the "Act") required a specific formation process with unique timing requirements. It is now clear that the contract formation process will be less important than the content of the contract and circumstances surrounding performance of it.
Report Link Texas Supreme Court Enforces Covenant Not to Compete (pdf).Ogletree Deakins - October 24, 2006 Texas Supreme Court Enforces Covenant Not to Compete. Report Link Texas Employers Finally Get Judicial Relief in Non-Compete Case.Jackson Lewis LLP - May 17, 2006 For years, Texas employers have been frustrated with court decisions invalidating their non-compete agreements. A spate of cases from courts of appeals across Texas has made it nearly impossible to have enforceable non-compete agreements with at-will employees, based on the reasoning that employer promises made within the at-will relationship are "illusory" since the employee could be discharged right after signing the agreement. Report Link Texas Court Delivers Another Blow to Non-Compete Agreements.Jackson Lewis LLP - February 17, 2003 Courts in Texas continue to struggle with the law regarding non-compete agreements, as a recent decision by the Dallas Court of Appeals indicates. That opinion adds to the trouble Texas employers may face when they seek to protect their business interests through enforcement of existing non-compete agreements with at-will employees.
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