Restrictive covenants and non-compete agreements have been a frequent matter of this weblog in current months, and rightfully so. Non-competes are usually thought-about setting pleasant gadgets to assist corporations defend commerce secrets and techniques and methods and strategies and aggressive benefits. Nonetheless, these agreements are falling out of favor all by way of the nation – the DOJ not too method again file a Assertion of Curiosity in a state courtroom case taking the place that non-competes might violate the Sherman Antitrust Act. Additional, states proceed to cross approved pointers limiting or banning using noncompete agreements, together with Illinois, Oregon, Nevada, DCand Colorado.
However one Texas courtroom appears to buck this development. Remaining month, Fort Bend County District Resolve J. Christian Becerra granted a brief restraining order (“TRO”) in a commerce secret misappropriation case, forcing quite a lot of former staff to cease work for a competing enterprise, and limiting one particular worker from collaborating in any competing work for any opponents. The catch? Not a single worker had a non-compete settlement.
The plaintiff all through the case is DistributionNOW (“DNOW”), a Houston-based provider of power and industrial decisions, merchandise and engineered devices packages. The defendants are former staff together with Toby Eoff, the sooner majority proprietor of Odessa Pumps. The criticism alleges that DNOW bought Odessa Pumps from Eoff for over $170 million and Eoff stayed with the corporate as a Vice President, and rose up the ranks to Govt Vice President in 2021. Then, on April 1, 2022, Eoff retired from his place and allegedly took with him quite a lot of information that contained “terribly delicate DNOW enterprise data.” Shortly thereafter, a minimal of 20 staff left their positions to hitch Permian Valve, a competitor of DNOW. Three of these staff allegedly took with them quite a lot of paperwork containing proprietary data.
On the day DNOW sued Eoff and the choice former DNOW staff, DNOW filed for a TRO looking for to enjoin the sooner staff from disclosing or utilizing any of the proprietary data allegedly misappropriated from DNOW. The Texas Courtroom granted the TRO, which prohibits the named former staff from working for Permian Valve, and considerably prohibits Eoff from “carrying on or collaborating in actions whereby Eoff straight or not directly, owns, manages, operates, controls, funds, invests in , participates in, consults with, or is in one other case related to, any enterprise, particular explicit individual, partnership, firm, agency or fully totally different entity which engages in any prepare that’s in direct rivals with DNOW and Odessa Pumps all through the enterprise of servicing and supplying pump devices .”
The assistance obtained is non eternal, nonetheless it is miles reaching. It grants a non-compete remedy when there seems to be no proof of use. Actually, the case bears watching. Keep tuned.
The case is DNOW LP vs. Toby Eoff et al., case quantity 22-DCV-294327, all through the 434th District Courtroom in Fort Bend County, Texas.