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Trade Secrets & Non-Competes
TUTSA misappropriation, restrictive covenants, and departing-employee litigation
Outside Counsel Not of Record Denied Access to AEO Materials in Trade Secrets Case
Joel Reese | Sep 30, 2026
In Unimachts Global v. Ayr Energy, the Business Court of Texas denied India-based BTG Advaya attorneys—not counsel of record—access to Confidential Information and Attorney's Eyes Only discovery materials in a trade secrets dispute between rival transformer manufacturers. The court rejected plaintiffs' plain-language interpretation of the protective order and applied the traditional balancing test used in trade secret cases to deny access to the non-appearing foreign counsel.
Business Court Modification of Temporary Injunction Fails Rule 684 Bond Requirement in Non-Compete Dispute
Joel Reese | Aug 05, 2026
The Fifteenth Court of Appeals reversed in part a Business Court order modifying a temporary injunction against former ES3 Minerals employees and their competing venture, holding that the injunction bond failed to adequately protect appellants' interests under Rule 684 and that the order lacked adequate specificity regarding enjoined subsidiaries. The court also held that challenges to portions of the injunction imposed by the original district court—but not reviewed or reimposed by the Business Court—were not properly before it on appeal.
TUTSA Preemption Does Not Bar Fiduciary Duty Claims Based on Independent Conduct Beyond Trade Secret Misappropriation
Joel Reese | Jul 28, 2026
The Business Court of Texas denied Ayr Energy's Rule 91a motion to dismiss claims for knowing participation in breach of fiduciary duty, holding that TUTSA preempts only claims premised on the same facts as trade secret misappropriation—not claims based on independent conduct such as employees using company resources to develop competing businesses while still employed. The court further held that a corporate defendant may be charged with knowledge its agents acquired while acting within the scope of their authority in furtherance of the defendant's business.
Business Court Grants Partial Injunction on Non-Compete, Applies Blue Pencil Doctrine to Overbroad Covenant
Joel Reese | Jul 28, 2026
In Galderma Laboratories v. Brenner, the Texas Business Court's Eighth Division granted in part a temporary injunction enforcing a non-compete agreement against a former executive, but reformed the covenant's scope under the blue pencil doctrine after finding certain service restrictions overbroad. The court denied injunctive relief on customer non-solicit, worker non-solicit, confidentiality, and TUTSA claims, finding Galderma failed to meet its burden on probable success or irreparable harm.
Assignment Does Not Expand Assignor's Rights in Trade Secret Settlement Proceeds
Joel Reese | Jul 28, 2026
In Mesquite Energy v. Sanchez Oil, the Business Court of Texas addressed the allocation of settlement proceeds from a prior trade secret misappropriation lawsuit involving Sanchez Oil & Gas Corporation, Sanchez Energy Corporation (now Mesquite Energy), and Sanchez Production Partners LP against Terra Energy Partners and former employees. The dispute centered on whether Mesquite, as assignee of Sanchez Production Partners' claims, could recover a separate share of the settlement funds beyond its own rights as successor to Sanchez Energy Corporation.