0

I left a job in Phoenix Arizona and am currently in Houston, Texas.

The noncompete I signed at the previous job was detailed in the scope of a time period (2yrs) and that I couldn't own or manage a substantially similar business, and also had some specific details around not poaching any of their clients.

Anyways, the non compete doesn't reference a geographical scope / area for the non compete to be limited to in any way.

I read the below, which notes the limitations of a noncompete in texas, and it explicitly states that it's enforceable when limited to a geographical area...

In 1989, the Texas legislature enacted section 15.50 of the Texas Business and Commerce Code. Section 15.50(a) states:

[A] covenant not to compete is enforceable if it is ancillary to or part of an otherwise enforceable agreement at the time the agreement is made to the extent that it contains limitations as to time, geographical area, and scope of activity to be restrained that are reasonable and do not impose a greater restraint than is necessary to protect the goodwill or other business interest of the promisee.

Would the absence of this limitation render the non-compete unenforceable?

1

What you're looking at there in the Code is the classic trinity for the protection of the legitimate business interests which are protectable by a restrictive covenant: 1. scope of the restriction 2. time of the the restriction 3. geographical scope of the restriction.

As a general principle of law, restrictive covenants may only protect the legitimate business interests of the employer, and go no further.

If you got a job here in the UK, that would be caught by the restrictive covenant described in your question.

Now, I ask you respectfully: is that within the legitimate business interests of your former employer?

It can't be, because you could be no possible threat to their legitimate business interests.

Unless of course, you worked for an intergalactic company like IBM - but even then it would be tough, tough ask.

It's therefore almost certainly unenforceable.

-1

It is limited to a geographical area: everywhere.

Whether this is reasonable will depend on the circumstances. For example, if you were a top executive at PepsiCo then a worldwide limitation on working for a soft drink company is probably reasonable.

  • 1
    Based on the quoted text, I suggest that limitations to geographic area do not imply "everywhere." – fred_dot_u Jan 18 at 21:19
  • It's possible that putting down "everywhere on Earth" would be a geographical area, but that's not what the NCA in question said. – David Thornley Jan 18 at 21:47
  • @fred_dot_u They can - if the employer is a multi-national and the employee is sufficiently senior – Dale M Jan 19 at 0:43
  • 1
    I think this is wrong. The law clearly requires a limitation as to geographical extent, but the contract doesn't have one. If the contract explicitly said "everywhere", then I agree for a senior executive in a multi-national that might well be reasonable (for a junior underling in a firm with customers confined to a 20 mile radius - not so much), but unless it does say "everywhere" it doesn't have a limit as to geographical scope - so presumably is not enforceable per the statute. – Martin Bonner supports Monica Jan 19 at 17:00

Your Answer

By clicking “Post Your Answer”, you agree to our terms of service, privacy policy and cookie policy

Not the answer you're looking for? Browse other questions tagged or ask your own question.