Chapter § 10-1 Initial Considerations

• Jurisdiction: United States

10-1 Initial Considerations

You now have liability evidence for breach of a restrictive covenant obtained from your client, from third parties, or through a Rule 202 action. In preparing to enforce your restrictive covenant, it is critical to first determine your objectives and formulate your game plan. Be realistic and manage your client's expectations accordingly. If you don't, then expect your client to be a one-off client.

Ultimately, the most difficult part of enforcing a restrictive covenant is identifying the relief you seek. This is especially true when obtaining injunctive relief because you must draft a proposed injunction that is able to withstand later challenges— remember, Section 15.50 of the Texas Business and Commerce Code allows for the recovery of attorney's fees if a defendant successfully dissolves an improper injunction. Moreover, your trial court will not be pleased if you supply it with a defective injunction and will likely hyper-scrutinize any future requests.

In formulating your game plan, ask yourself:

• Should I seek injunctive relief to enforce a restrictive covenant? If so, should I request an equitable extension of the restriction period?

10-1:1 Commentary

Equitable extensions are a valuable tool to ensure that your client gets the restrictions it bargained for.

• Guy Carpenter & Co., Inc. v. Provenzale, 334 F.3d 459, 464 (5th Cir. 2003) (permitting equitable extension due to litigation delay).

But, do not delay. If you wait, then you may waive the right to equitable extension.

• RenewData Corp. v. Strickler, No. 03-05-00273-CV, 2006 WL 504998 (Tex. App.—Austin Mar. 3, 2006, no pet.) (mem. op.) (equitable extension denied because the delays in the enforcement were not simply "inherent to litigation[.]").
(a) Should I request expedited discovery? If so, realize that a court will probably provide the same opportunity to the defendant.
(b) Do I have realistic proof that a judge will believe? Is the proof based on personal knowledge?
(c) If I do not seek injunctive relief, do I waive any rights under your agreement? Has the right to injunctive relief been waived?
(d) Did the departing employee bring a prior employer's confidential information when he/she started work for my client? This type of claim can have more teeth than the non-compete.
(e) Can I show likelihood of success on the merits and irreparable harm? Do I have "black hat" evidence? Is there "black hat"

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