From Non-Competes to the Inevitable Disclosure Doctrine: The Departing Texas Employee

In Texas, there has been an explosion of highly contentious litigation between employers and their departing employees over alleged breaches of non-compete agreements, trade secret misappropriation, and breaches of fiduciary duties. The law in all three areas is rapidly changing in significant ways and Texas lawyers who don't stay on the cutting edge are at a real disadvantage. This program aims to arm lawyers with the advanced legal tools and substantive knowledge they need to fight and win these cases. Join attorney Mark Oberti to discuss how overbroad non-compete agreements may be reformed and enforced, and how having an overbroad non-compete may: (1) significantly limit the recovery of damages for breach of the non-compete; and (2) potentially lead to a large attorneys' fee award against the employer.

Additionally, address the status of the controversial "inevitable disclosure" doctrine in Texas, the Federal Defend Trade Secrets Act of 2016 and the Texas Uniform Trade Secrets Act, including one court's recent interpretation of the law that could largely negate the law's application to departing employees. Mr. Oberti will also visit the complexities of temporary injunction practice, including: (1) the effect of contractual stipulations of irreparable harm; (2) the effect of delay on an employer's ability to obtain a temporary injunction; (3) the unclean hands defense to entry of temporary injunction; and (4) whether an ex-employee's new employer is a necessary party to a temporary injunction action.   

Learning Objectives:

1. Address several cases, including:
   • A recent case analyzing alleged "specialized training" as such consideration
   • Southwestern Energy Production Co.
   • GlobeRanger Corp.
   • A 2018 Texas Uniform Trade Secrets Act case where the employer was awarded reasonable royalty damages of $4 million and a permanent injunctive, despite  only suffering $10,500 in lost profits from the misappropriation of its trade secrets
   • Drennan and the impact on the latest on choice of law and choice of forum clauses in non-compete agreements and similar agreements
     
2. Confidently navigate the legal thicket regarding the permissible scope of geographic limitations and restrictions on the scope of activities in non-compete agreements
3. Address the split between state and federal courts concerning when an overbroad non-compete may be reformed, and see how the difference can dramatically impact whether or not a temporary injunction can be entered, as well as the ultimate recovery of damages
4. Identify how courts analyze contractual provisions that do not bar competition, but instead exact a monetary penalty if the employee leaves and competes
5. Gain insight into the actions an employee may lawfully take to prepare to compete against their current employer, and the actions that cross the line into an illegal breach of fiduciary duty