Monday, June 27, 2011

Texas Supreme court on non-competes

 "... whether a covenant not to compete signed by a valued employee in
consideration for stock options, designed to give the employee a greater stake in the company’s performance,
is unenforceable as a matter of law because the stock options did not give rise to an interest in restraining
competition. We hold that, under the terms of the Covenants Not to Compete Act (Act), the consideration for
the noncompete agreement (stock options) is reasonably related to the company’s interest in protecting its
goodwill, a business interest the Act recognizes as worthy of protection."

Reverses the lower Court decision.

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