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  1. #11
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    Default Re: Former Employer is Telling Employee's Customers that He is Violating a Non-Compet

    Quote Quoting cbg
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    If you did not have any kind of non-compete, you are free to try to sign his customers. However, he is also free to try to protect his business and keep them. If he tells them you have a non-compete, you tell them that you don't.
    He is not free to lie to a competitor's clients in order to try to take away the competitor's business -- that can rise to the level of tortious interference with contract.
    Quote Quoting Prudential Ins. Co. of Am. v. Fin. Review Servs., Inc., 29 S.W.3d 74 (Tex. 2000).
    We have identified the elements of tortious interference with an existing contract as: (1) an existing contract subject to interference, (2) a willful and intentional act of interference with the contract, (3) that proximately caused the plaintiff's injury, and (4) caused actual damages or loss.
    Quote Quoting cbg
    Any attempt for you to use the law to stop him from doing what he's doing, is just as likely to end up requiring that you stop doing what you're doing.
    Absent additional facts, I'm not willing to join that generalization.
    Quote Quoting Taxing Matters
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    In order to be liable to the former employer for soliciting the former employer's customers the employee must have entered into some agreement that prevented him from doing that.
    You don't need a written contract to protect trade secrets -- an employee who steals trade secrets can be successfully sued even if he has not signed anything with the former employer.
    Quote Quoting Trilogy Software, Inc. v. Callidus Software, Inc., 143 S.W.3d 452, 463 (Tex.App.-Austin 2004)
    Misappropriation of trade secrets is a common-law tort cause of action. The elements of misappropriation are: (1) existence of a trade secret; (2) breach of a confidential relationship or improper discovery of a trade secret; (3) use of the trade secret; and (4) damages.
    However, in the absence of an agreement, the employer must establish that the customer list was a trade secret,
    Quote Quoting Numed, Inc. v. McNutt, 724 S.W.2d 432 (Tex. App.-Fort Worth 1987, no writ)
    To be accorded the court's protection, proprietary information must be more than merely of a kind and character encompassed by the definition.... It must be information that is not publicly available or readily ascertainable by independent investigation.
    For an obvious example of a customer list that is not a trade secret, take a look at a typical building supply company's website and you will often find a search feature for its distributors and retailers.

    It's not necessary that a misappropriated customer list be an actual document or electronic file, but it must actually qualify as a trade secret before a former employer can successfully sue over its misappropriation.

    As the former employer under discussion is making false claims of having a non-compete, not having his lawyer send a cease-and-desist letter based upon misappropriation of trade secrets, there's a good chance that the customer list is not a trade secret. (It could also be that the former employer doesn't understand his actual legal rights.)

  2. #12
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    Default Re: Former Employer is Telling Employee's Customers that He is Violating a Non-Compet

    Quote Quoting Mr. Knowitall
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    You don't need a written contract to protect trade secrets -- an employee who steals trade secrets can be successfully sued even if he has not signed anything with the former employer.
    Well, I agree that it need not necessarily be written. The Texas case you cited states as one element of the claim that there must be a “breach of a confidential relationship or improper discovery of the trade secret.” A federal appeals court interpreting Texas trade secret law stated: “The owner of the secret must do something to protect himself. He will lose his secret by its disclosure unless it is done in some manner by which he creates a duty and places it on the other party not to further disclose or use it in violation of that duty.” Taco Cabana International, Inc. v. Two Pesos Inc., 932 F.2d 1113 (5th Cir. 1991). So, to be liable for misappropriation of a trade secret where the employer has shared with the employee his customer list the owner must have taken steps when disclosing that alleged trade secret to protect it, i.e. place a duty on the employee not to disclose it. That would require an agreement (though not necessarily written) between the two that the employee will not disclose the trade secret. That agreement would be the basis for the confidential relationship required for the tort. Simply being an employee does not a confidential relationship make. An employer cannot simply claim after the employee is dismissed that the customer list is now a trade secret that the employee is not allowed to use or disclose if the employer took no action when he disclosed the information to the employee to ensure that the employee had no duty to protect it.

  3. #13
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    Default Re: Employer Interfering with My Business

    Quote Quoting Tang Zulu
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    Even if your ex-employer does have a con-compete with you, he would barely have recourse on which to sue the customers you are approaching. The customers are free to choose whoever they want to do business with (provided it's nothing illegal) irrespective of any type of agreement, potential or ongoing litigation, you have, or might have had, with the ex-employer. You can tell that to your customers.

    Sure. If you believe in an old testament derived logic of balance.
    Or you could call it celestial business justice.
    Both equally asinine.
    So you're saying that 1. OP can compete with his former employer for said former employer's customers, and 2. OP's former employer cannot compete with OP to retain said former employer's customers?

  4. #14
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    Default Re: Former Employer is Telling Employee's Customers that He is Violating a Non-Compet

    Quote Quoting Taxing Matters
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    The Texas case you cited states as one element of the claim that there must be a “breach of a confidential relationship or improper discovery of the trade secret.”
    As in, an employment relationship.
    Quote Quoting T-N-T Motorsports v. Hennessey Motorsports, 965 S.W.2d 18 (Tex.App.-Houston (1st Dist.) 1998, pet. dism'd).
    Certain duties, apart from any written contract, arise upon the formation of an employment relationship. Miller Paper Co. v. Roberts Paper Co., 901 S.W.2d 593, 600 (Tex.App.-Amarillo 1995, no writ). One of those duties forbids an employee from using confidential or proprietary information acquired during the relationship in a manner adverse to the employer. Id. This obligation survives termination of employment. Id. Although this duty does not bar use of general knowledge, skill, and experience, it prevents the former employee's use of confidential information or trade secrets acquired during the course of employment.
    As you can see, all that is required to create a duty on the part of the employee is the employment relationship.
    Quote Quoting Taxing Matters
    A federal appeals court interpreting Texas trade secret law stated: “The owner of the secret must do something to protect himself. He will lose his secret by its disclosure unless it is done in some manner by which he creates a duty and places it on the other party not to further disclose or use it in violation of that duty.”
    If an employer maintains a confidential customer list, available only to employees, then it is doing something to protect itself -- it is maintaining its list and is sharing it only with people with whom it has a confidential relationship. You don't have to additionally tell employees, "You're not allowed to steal our trade secrets" for them to remain trade secrets or to have a cause of action against former employees who misappropriate trade secrets.

  5. #15
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    Default Re: Former Employer is Telling Employee's Customers that He is Violating a Non-Compet

    I do not think the customers I contacted after leaving my employer is confidential information. It was openly disclosed to potential customers as reference and even published on written publications even when I was an employee.

  6. #16
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    Default Re: Former Employer is Telling Employee's Customers that He is Violating a Non-Compet

    Quote Quoting watermelon
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    I do not think the customers I contacted after leaving my employer is confidential information. It was openly disclosed to potential customers as reference and even published on written publications even when I was an employee.
    so you are saying you did cull your prospective customer list from your prior employers active customer list?
    If it was a public as you state, then it probably isn't a problem but...

    I'm not saying it is a problem or not. You aren't very open with inform and refused to answer an outright question that is important to the matter. I would suggest speaking with a local attorney that you are willing to share all the necessary information with.

    Now, there is a possibility for you as well but it will depend on a lot of things not disclosed here:

    their actions may also be unlawful, if in fact they are lying to prospective customers to dissuade them from buying from you. One thing that makes it odd is the former employer was threatening to sue, not you, but their customers. Even if there was a non-compete the employers actions would be against you, not the customer. Given they are threatening the customers, I would have to think there is some issue between the customers and the former employer that could allow the action they threaten. After all, most customers do not enjoy threats from a supplier if there is no basis for the statement. It seems it would be a very quick way to lose a customer to me.

    so, what you need to do is take all your information and find a good attorney who can review everything and give you an opinion where you and the former employer stand in this issue.

  7. #17
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    Default Re: Former Employer is Telling Employee's Customers that He is Violating a Non-Compet

    I would be very darned certain that there was no "Covenant Not To Compete" included in something I did sign.

  8. #18
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    Default Re: Former Employer is Telling Employee's Customers that He is Violating a Non-Compet

    Quote Quoting watermelon
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    I do not think the customers I contacted after leaving my employer is confidential information. It was openly disclosed to potential customers as reference and even published on written publications even when I was an employee.
    From what you have told us, your former employer is not claiming that you misappropriated a customer list, and is not actually threatening litigation. I don't see that it is necessary for you to discuss the theoretical possibility that your lawyer might, in the future, claim that you misappropriated a customer list -- unless you're already speaking with the lawyer and throw in the question because you're already there.

  9. #19

    Default Re: Employer Interfering with My Business

    Quote Quoting eerelations
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    So you're saying that 1. OP can compete with his former employer for said former employer's customers, and 2. OP's former employer cannot compete with OP to retain said former employer's customers?
    Not at all.
    OP claims ex-employer threatened customers with legal action if they engaged with OP. Ex-employer never threatened OP with legal action.
    The point here is that customers have nothing to worry about as far as legal claims by the ex-employer against them. OP claims ex-employer is trying to scare customers into avoiding OP via threats of legal prosecution against customers, not OP. In other words, whether ex-employer goes after OP is irrelevant as far as the customers are concerned.

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