Restrictive covenants to not compete, or non-compete agreements, are one among quite a lot of instruments corporations use to guard their commerce secrets and techniques and aggressive benefit. Nonetheless, whether or not a court docket will implement a restrictive covenant varies broadly throughout jurisdictions, together with throughout states throughout the Fifth Circuit. For instance, the Louisiana statute governing restrictive covenants applies a two-year durational restrict, whereas Mississippi frequent legislation applies a extra normal ‘cheap and particular’ customary to the period and geographic scope of a restrictive covenant. As well as, Mississippi courts should steadiness the rights of the employer, the worker, and the general public when imposing restrictive covenants. buses. Commc’ns, Inc. v. Banks, 91 So. 3d 1, 11 (Miss. Ct. App. 2011), aff’d, 90 So. 3d 1221 (Miss. 2012).
Texas applies comparable components, however courts have “distributed with a number of components completely” the place the restrictive covenant was “moderately slender to guard an organization’s enterprise curiosity or goodwill.” Direct Biologics, LLC v. McQueen, No. 1:22-CV-381-SH, 2022 WL 1409984, at *9 (WD Tex. Could 4, 2022). For instance, in Totino v. Alexander & Associates, Inc., the court docket enforced a restrictive covenant though it didn’t comprise a geographic limitation. No. 01-97-01204-CV, 1998 WL 552818, at *3-4 (Tex. App. Aug. 20, 1998). The court docket reasoned that the restrictive covenant was moderately slender, regardless of no geographic limitation, as a result of it was restricted to communications with former shoppers with whom the previous staff had labored. id.
| state | Regulation Governing Restrictive Covenants | Restrictive Covenants Are Enforceable If the Covenant Is: |
| Louisiana | La. Rev. Stats. Ann. § 23:921 | Restricted to a two-year period; Features a checklist of the geographic areas during which the previous worker is restrained; Restricted to forestall competitors between the previous worker and employer. |
| Mississippi | See, eg, buses. Commc’ns, Inc. v. Banks, 91 So. 3d 1, 11 (Miss. Ct. App. 2011), aff’d, 90 So. 3d 1221 (Miss. 2012) | Affordable and particular in period; Affordable and particular in geographic scope. |
| Texas | Tex. buses. & com. Code Ann. §§ 15.50, 15.52 | Ancillary to or a part of an in any other case enforceable settlement on the time the settlement was made; Moderately restricted as to time; Moderately restricted as to geographical space; Moderately restricted as to the scope of exercise to be restrained. Restricted to what’s essential to guard the employer’s goodwill or different enterprise pursuits. |