Texas Case Could Open Door To Broader Noncompetes

Law360, Dallas (February 28, 2017, 10:04 PM EST) -- A Texas Supreme Court case up for arguments Wednesday could make it easier for companies to stop former executives from competing against them in niche market segments even if their agreements don't follow the rule of setting geographic boundaries, lawyers say.

In Horizon Health Corp. v. Acadia Healthcare Company Inc., the Texas justices have been asked whether state law allows enforcement of a noncompete provision that doesn't have a geographic limit if other restrictions on the workers make it reasonable overall. Horizon is aiming to enforce such agreements with five executives who allegedly sought to form a competing business, arguing it...

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