Coercion? Intimidation? to Force Non-Compete Compliance
Assume for a moment that your company has a solid non-compete or non-solicitation agreement in place that is reasonable and there is an ex-employee out there violating the agreement. At this point your lawyers have prepared the standard cease and desist letter but the ex is continuing to compete, or so you think. What are your options besides (1) doing nothing or (2) investing the time and attorneys’ fees to prepare a lawsuit and temporary restraining order or injunction?
I’ve discussed the Texas Rule of Civil Procedure Rule 202 or pre-suit deposition here previously. Here is another article written by Dallas lawyer Jason Copling on the mechanics of how it works. The takeaway is if your suspect you may have a claim or want to investigate a lawsuit you can use Rule 202.
The point of the 202 is the process. It makes the target feel like they’re getting sued. First, they are served with what very much looks like a lawsuit by a process servers. Second, the pleading looks a lot like a lawsuit. Third, they they get served with a notice that says they have to appear for a hearing with the assigned judge. (It’s during that hearing that the time and details of the deposition will be set).
Even before the hearing takes place one would assume the ex-employee knows the company means business and is serious about enforcement. At this point there could be some dialogue to see if some resolution can be reached because most normal folks don’t want to hire and pay a lawyer to defend them and certainly don’t want to go under oath. If not, move forward with the deposition, try to get some documents (hopefully solid evidence of competition), and the evaluate whether a lawsuit is appropriate.
Recently, I had a situation where I took the Rule 202 deposition of an ex-employee and his new employer. The ex said he was not targeting my client’s customers. The new employer said he was and produced a document showing that he was targeting my client’s customers. Faced with a lawsuit the new employer let ex-employee go.
Don’t underestimate the Rule 202 as a means to apply pressure short of a lawsuit. As I’ve said before, if you have post-employment covenants that are worth enforcing, enforce them.