Non-Disclosure Agreements

A promise not to disclose a former employer’s confidential business information and trade secrets is not a covenant not to compete. This means that the requirements applicable to Texas non-competes do not apply to the legal analysis of these types of contracts.

Under Texas law, a non-disclosure agreement is enforceable even if it is coupled with an unenforceable non-compete agreement or an invalid non-solicitation provision. Further, even if an employee does not sign a non-disclosure agreement, many Texas employees are under a statutory duty under state and federal law not to disclose or use an employer’s trade secrets.

Violating a non-disclosure agreement can be just as dangerous as violating a non-compete agreement. Some violations entitle an employer to injunctive relief. Others may entitle the employer to monetary damages. And, unlike Texas non-competes, an employer who proves a material breach of a non-disclosure agreement may be eligible to recover its reasonable attorney fees from an employee.

For information on Texas covenants not to compete, please click here.