TEXAS BUSINESS LAW UPDATE:NON-COMPETITION AGREEMENTS EASIER TO ENFORCE
Posted on | August 7, 2011 | No Comments
A few blog entries ago I discussed the enforceability of noncompete agreements. In that article, I mentioned that noncompete agreements may be enforced if they contain reasonable limitations with respect to geography, time and scope of the activity and if they are ancillary to an enforceable agreement.
On June 24, 2011, the Texas Supreme Court shifted away from its previous analysis of noncompete agreements, ruling that the issuance of stock options which are exercised by employees can support a noncompetition agreement. The court found that the interest the employer is protecting, here the goodwill of the company, must only be “reasonably related” to the consideration, or the stock options, provided by the company. This is a break from prior Texas Supreme Court rulings, which held that the consideration an employer provided to the employee must give rise to an interest in restraining competition, such as a promise of trade secrets or confidential information.
If you would like to discuss how the Texas Supreme Court’s new ruling effects your noncompetition agreement with your employer or Texas Business Law, please call The Wright Firm today at 972-353-4600 or visit our website at www.thewrightlawyers.com
Tags: Dallas Business Attorney > Dallas Business Lawyer > Dallas Employment Attorney > Dallas Employment Lawyer > Denton Business Lawyer > Enforceability of Non-Compete Agreements > Lewisville Business Lawyer > Non-Compete > Non-Competition Agreements > noncompete agreements > Texas Business > Texas Business Law > Texas Supreme Court > The Wright Firm
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