Category Archives: Recent Developments 2014

Houston Court of Appeals Extends Drennen to an Suit for Injunctive Relief to Enforce a Non-Compete

On August 29, 2014, the Texas Supreme Court issued its decision in Exxon Corp. v. Drennen, holding that New York law governed the enforceability of a non-compete in the context of the forfeiture of an employee’s stock options.  The Texas Supreme Court held that, when the only penalty is the forfeiture of stock options, the… Read More »

Fifth Circuit Upholds Religious Discrimination Claim by Fort Bend County Employee

Religious discrimination claims are different from most other types of discrimination claims because, under appropriate circumstances, an employer may have an affirmative obligation to accommodate an employee’s religious practices.  The Fifth Circuit considered this type of religious discrimination claim in Davis v. Fort Bend County, No.13-20610 (5th Cir. Aug. 26, 2014). The plaintiff was an… Read More »

Houston of Appeals Upholds Pregnancy Discrimination Claim Based on Termination Three Months After Childbirth

Both Title VII of the Civil Rights Act of 1964 and Chapter 21 of the Texas Labor Code prohibit discrimination based on pregnancy.  But do those statutes apply to an employee who has already given birth and is no longer pregnant?  The First Court of Appeals addressed that issue in Kipp, Inc. v. Whitehead, No…. Read More »

The Fifth Circuit Finds That a Reduction in Job Responsibilites Could Constitute an Adverse Employment Action

One of the essential elements of a discrimination claim is that the employee must have suffered an “adverse employment action.”  The purpose of this element is to weed out minor complaints, such as write-ups and other matters that do not affect the terms and conditions of employment.  As a general rule, an adverse employment action… Read More »

The Fifth Circuit Clarifies the Rules for Mis-Named Employers in EEOC Charges

Most of the discrimination statutes require a mandatory administrative process as a prerequisite to filing a lawsuit.  The employee must file a charge of discrimination with the EEOC or TWC within a specified number of days, and then the agency is supposed to investigate the charge.  If the agency does not pursue the charge, it… Read More »

Austin Court of Appeals Affirms Disparate Impact Judgment in Age Discrimination Case

Thirty-three City of Austin employees sued for age discrimination, claiming that the terms of their transfer from a defunct department to the Austin Police Department had a disparate impact on older workers. They won the case to a jury. On February 7, 2014, the Austin Court of Appeals affirmed the judgment in City of Austin… Read More »

First Court of Appeals Vacates Temporary Injunction in Non-Compete/Trade Secrets Case Due to Lack of Specificity

Rule 683 of the Texas Rules of Civil Procedure provides that an injunction order “shall set forth the reasons for its issuance; shall be specific in terms; [and] shall describe in reasonable detail and not by reference to the complaint or other document, the act or acts sought to be restrained.” Notwithstanding that language, it… Read More »

Fifth Circuit Reverses a Jury Verdict in a Racial Harassment Case Because the Employer Took Prompt Remedial Action

When one employee harasses another employee on the basis of sex, race, or another protected classification, the employer is not automatically liable for the misconduct of the employee. Instead, vicarious liability attaches only if the employer knows (or should have known) about the harassment and fails to take prompt remedial action. The Fifth Circuit applied… Read More »

Fort Worth Court of Appeals Finds Non-Compete Unenforceable Due to Waiver and Overbreadth

In an unpublished opinion, the Fort Worth Court of Appeals found that a non-compete was unenforceable due to waiver and overbreath. Ally Financial, Inc. v. Gutierrez, No. 02-13-00108-CV (Tex. App. — Fort Worth Jan. 23, 2014). Gutierrez worked for Ally in Lewisville, Texas. Ally adopted a compensation incentive plan (CIP) under which certain employees (including… Read More »

Fourteenth Court of Appeals Holds that Equitable Estoppel Bars an Employer from Asserting the Statute of Limitations in an FLSA Case

The Fair Labor Standards Act requires employers to pay the minimum wage and overtime. The FLSA contains a two-year statute of limitations that can be extended to three years in the case of willful conduct. On January 28, 2014, the Fourteenth Court of Appeals affirmed a jury verdict that allowed the plaintiff to bypass the… Read More »