Non-compete agreements run the gamut of industries. Here we’ve discussed non-compete agreements involving pet care providers and rocket pack producers. In many cases, it would seem that business owners just include them to dissuade an employee from leaving with the realization it is not enforceable. The reality is non-compete agreements in Texas should apply in only very limited circumstances when used properly – that however is not always the case.
A recent case in Pennsylvania pitted two rival fireworks companies against each other in a non-compete dispute. These companies handle big events like firework displays at college football games and at Times Square during New Years. Matthew Wood is a talented fireworks choreographer who had a non-compete agreement with his former employer Zambelli Fireworks. In 2008 he left Zambelli for Pyrotecnico, a rival fireworks company. Zambelli apparently lost business to Pyrotecnico and sued over Wood’s non-compete agreement. The Court dismissed the suit holding:
Zambelli has failed to introduce sufficient admissible evidence to enable a reasonable factfinder to determine that its loss of business was due to wrongful conduct by Wood, as opposed to the mere loss of his services or other competitive factors.
It’s hard to see how a non-compete agreement with a fireworks choreographer would be enforceable under Texas law. The agreement would have to be ancillary to an otherwise enforceable agreement meaning the non-compete would have to protect something provided to the employee like a trade-secret. Employers in many instances have difficulties identifying the protectable interest and courts tend to focus on this component of any claim. Zambelli, according to the Court could not identify how Wood’s conduct caused a loss of business and he is free to continue his work with Pyrotecnico.
