Breach of non-compete by former officer

We suspect that a former officer of the company is in breach of his non-compete. What can be done? a demand letter? must he admit/deny to a direct question weather or not he in breach of his agreement or can he just ignore the request all together?

Plano, TX -

Attorney Answers (3)

Jason Edward Winford

Jason Edward Winford

Employment / Labor Attorney - Dallas, TX
Answered

Certainly, a demand letter or a cease-and-desist letter, would be an initial option. Sometimes, it it will put a stop to the former employee competing in violation of a non-compete; other times, they will ignore it or respond to say either they are not violating it or that they (or their lawyers) think the non-compete is not enforceable. What he does in response is really up to him as a practical matter. If he chooses to ignore or to dispute your demand, then you have to decide whether to file suit or not, including seeking temporary injunctions or restraining orders. These steps are things you would definintely want to discuss with an employment or business litigation lawyer, to see if the evidence you have have (or think you can get) will support the relief you want, to see if the non-compete is enforeceable or if there are other legal duties the former officer may have violated, and to navigate the complicated world of litigation particularly where injunctions are involved. And also, you have to consider the time and expense involved. Good luck to you.

This information is provided as a general reference based on the limited information that was provided and should... more
R. Russell O'Rourke

R. Russell O'Rourke

Business Attorney - Cleveland, OH
Answered

Generally, the answer is first find out whether he has or not, you can likely do that without himn admitting anything. You said you suspect, is that just a gut feeling or has someone called you with some information. Investigate. Once you know that there has been a violation, you attorney will likely want to file a Temporary Restraining Order, then a Temporary Injunction and finally a Permanent Injunction (the names might be slightly different in your state). to keep him from competing.

Understand that these lawsuits can be fairly expensive. Check Avvo for a local business litigation attorney. They should be able to give you a good idea about how much such a lawsuit is likely to cost (depending on how much they fight $10,000 to 20,000 wouldn't be out of the question, perhaps more, perhaps a LOT more depending on how serious this could be to you.

We have handled cases like that. Some are particularly difficult and others settle and usually settle quickly because everyone wants to get on with their lives and this kind of case hurts everyone, even you. Your customers do NOT want to be dragged into a lawsuit and really don't like it when "mommy and daddy" fight.

IF YOU FOUND THIS ANSWER HELPFUL PLEASE MARK IT SO. The answers provided by R. Russell O’Rourke, Attorney-at-Law... more
Adam Nelson Rieck

Adam Nelson Rieck

Banking Law Attorney - Dallas, TX
Answered

The answer to your question is going to hinge on many things, not least of which, is the evidence you have of the alleged breach and the remedy you are interesting in achieving.... Mere suspicion is not going to be enough. Texas law provides for temporary restraining orders (tells the other party to stop) and limited discovery (allows you start finding out key facts and talking about things like admitting and denying same) in cases of suits upon non-compete agreements, but they are only granted by the court when the evidence indicating that the breach is sufficient enough to warrant it. Only an attorney is going to be able to review your facts and give an opinion. A reread of your non-compete is often useful too, as some provide for additional terms and guidance beyond, "thou shall not", often providing for remedies, etc. Like I said, all of this is highly dependent on many variables and you should be careful about proceeding without competent counsel. You can damage to your case by just firing off letters.

The above comments are made by an attorney at The Rieck Law Firm (RLF). RLF offers free initial consultation to... more

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