Competent Attorney in Houston Advises You on Non-Competes and Trade Secrets
Honest lawyer serving employers and employees for more than 28 years
In Texas, employees may not compete with or use the trade secrets and confidential information of a current employer without the employer’s permission. Employees have a duty of loyalty to the employer.
But what happens after an employee leaves the company? This is concern for both employers and employees. An employer wants to be sure that a former employee will not exploit the company’s secrets and harm the company. An employee wants the freedom to find a new job or open a new business without facing the threat of a lawsuit by the employer.
The law provides rights to both employers and employees. Houston employment attorney David C. Holmes guides you through the competing rights and obligations under Texas law.
The fundamentals of non-competes
In many states, non-competes are virtually unenforceable. Texas is not one of those states. In 1989, the Texas legislature passed a statute that governs the enforceability of non-competes. For over 20 years, the courts debated the proper interpretation of the statute. At times, it was difficult to decide when a non-compete was enforceable and when it was not. In recent years, much (but not all) of that confusion has been resolved. The key consideration is the reasonableness of the non-compete:
- Is the non-compete limited to a reasonable period of time?
- Is the non-compete limited to a reasonable geographic area?
- Is the non-compete limited to a reasonable set of activities that are prohibited?
- In general, is the non-compete reasonably tailored to protect the employer’s legitimate interests without unfairly restricting the employee’s right to work?
An employer must take care in drafting a non-compete that will be upheld by the courts as reasonable. Likewise, employees must beware of signing a non-compete that will render them unable to work in their chosen field.
In many cases, the result will be litigation. The employer will seek a temporary restraining order, a temporary injunction, or damages against the employee and (in many cases) the employee’s new business. The employee must be prepared to defend against such a lawsuit.
An employment attorney in Houston is qualified to advise you on your rights as an employer or employee when it comes to non-competes, and to represent you in litigation to enforce or defeat the enforcement of non-competes.
The fundamentals of trade secrets
Texas law protects a company’s trade secrets, as well as many types of confidential or proprietary information that is subject to protection either by law or by contract. This information can include:
- Proprietary technology and expertise
- Internally developed production processes
- Many types of software
- Customer lists
- Sales strategies
- Business plans
- Financial data
- Market research
An employer can take affirmative steps to protect this sort of information while the employee is still at the company and must be aware of the types of information that can and cannot be protected. The flipside of this is that employees must know the sorts of information that they can and cannot use after leaving the company, and they must know the steps that can be taken to protect them against a claim of trade secret theft.
Once again, many of these disputes result in a lawsuit seeking an injunction or damages based on alleged theft of trade secrets or misuse of confidential information. The employer must be prepared to vigorously protect its legitimate secrets, and employees must be prepared to defend themselves against accusations of wrongdoing.
An experienced Houston employment lawyer can guide both employers and employees through this process and, if necessary, maximize the chances of success in litigation.
See us to discuss the issues with non-competes and trade secrets
You need to know your rights and obligations and how to protect your legitimate interests. For a free consultation, contact our firm by phone at 713.586.8862 or online. Flexible office hours are available.