Texas Federal Courts Reach Differing Conclusions On Granting Injunctive Relief On Close To Expiring Or Expired Non-Competes: Some Courts Elect To Equitably Extend Covenants

Travelhost, Inc., produces magazines and other publications designed to help travelers. Over the course of the last several years, a number of employees, each of whom had signed a non-compete agreement, left the company and began working for its competitors.

Travelhost sued several of the ex-employees in the U.S. District Court for the Northern District of Texas for alleged violations of its non-compete agreements and achieved varying results. One defendant had stopped competing by the time judgment was entered and had departed the relevant territory. With only four months of the non-compete period left when Travelhost’s motion for entry of a preliminary injunction was decided, Chief Judge Fitzwater ruled that if competition resumed injunctive relief would be inappropriate and a compensatory award would suffice.

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