Court Opinion

ID: 4063853
Source: CourtListenerOpinion
Date Created: 2016-09-29 21:04:10.667882+00
Date Added: 2024-06-11T14:32:18.150044
License: Public Domain

ACCEPTED
                                                                                  07-14-00443C V
                                                                      SEVENTH COURT OF APPEALS
                                                                               AMARILLO, TEXAS
                                                                             4/10/2015 4:41:10 PM
                                                                                Vivian Long, Clerk

                       NO. 07-14-00443-CV

                                                                  FILED IN
                                                           7th COURT OF APPEALS
                       In The Court of Appeals               AMARILLO, TEXAS
                  for the Seventh District of Texas        4/10/2015 4:41:10 PM
                             at Amarillo                        VIVIAN LONG
                                                                   CLERK

          The Burks Group, Inc., d/b/a Integrated Partners,
                                  Plaintiff-Appellant,

                                 V.

Integrated Partners, Inc., Dalrock Transport, L.L.C., John P. Barnett,
              David Dreiling, & Allen Thomas Georgi
                                  Defendants-Appellees.

  On Appeal from the 44th District Court of Dallas County, Texas,
         And Transferred from the 5th Court of Appeals

                     APPELLANT’S BRIEF

                Appellant Requests Oral Argument

                               JENSEN & JENSEN
                               A Professional Corporation
                               JOHN R. JENSEN
                               STATE BAR OF TEXAS
                                I.D. #10646500
                               6025 Interstate 20 West
                               Arlington, Texas 76017
                               Tel: (817) 478-4940
                               Fax: (817) 478-4707
                               Email: jrj@jensen-law-firm.com
                               Attorneys for Plaintiff-Appellant
                 I. IDENTITY OF PARTIES AND COUNSEL

      The following is a complete list of the parties to this suit:

1. Plaintiff:      The Burks Group, Inc. d/b/a Integrated Partners

   Attorney:       John R. Jensen
                   Jensen & Jensen, PC
                   6025 Interstate 20 West
                   Arlington, Texas 76017

2. Defendant:      Integrated Partners, Inc.

   Attorney:       Brian T. Cartwright
                   1710 Westminster
                   Denton, Texas 76205

3. Defendant:      Dalrock Transport, L.L.C.

   Attorney:       Brian T. Cartwright
                   1710 Westminster
                   Denton, Texas 76205

4. Defendant:      John P. Barnett

   Attorney:       Brian T. Cartwright
                   1710 Westminster
                   Denton, Texas 76205

5. Defendant:      David Dreiling

   Attorney:       Pro Se
                   1408 Melody Ln.
                   Carrollton, Texas 75006

6. Defendant:      Allen Thomas Georgi

   Attorney:       Pro Se
                   2701 North Grapevine Mills #714
                   Grapevine, Texas 76051

                                           i
                                   II. TABLE OF CONTENTS

I.     PARTIES TO SUIT                     .......................................                                       i

II.    TABLE OF CONTENTS                            . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ii

III.   INDEX OF AUTHORITIES                         . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . iv

IV.    STATEMENT OF THE CASE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1

V.     STATEMENT REGARDING ORAL ARGUMENT                                                    ............. 2

VI.    ISSUES PRESENTED                    ....................................... 2

VII. STATEMENT OF FACTS                             .................................. 2

VIII. SUMMARY OF THE ARGUMENT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10

IX.    ARGUMENT                  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11

       1.  THE TRIAL COURT ERRED BY REFORMING THE COVENANT
       NOT TO COMPETE   . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11

               A.  THE TRIAL COURT ERRED BY REFORMING THE
               COVENANT NOT TO COMPETE AT THE HEARING ON
               PLAINTIFF’S APPLICATION FOR TEMPORARY INJUNCTION
                   . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14

               B.  THE TRIAL COURT ERRED BY REFORMING THE
               COVENANT NOT TO COMPETE TO CONFORM TO THE
               CONDUCT OF THE DEFENDANT/PROMISOR, THEREBY
               RENDERING IT MEANINGLESS . . . . . . . . . . . . . . . . . . . . . . . . 16

       2.   THE TRIAL COURT ERRED IN DENYING PLAINTIFF’S
       MOTION FOR JUDGMENT NON OBSTANTE VEREDICTO AND
       MOTION FOR NEW TRIAL IN THAT THE JURY FINDING ON THE
       ISSUE OF TORTIOUS INTERFERENCE WITH A CONTRACT WAS
       AGAINST THE GREAT WEIGHT AND PREPONDERANCE OF THE
       EVIDENCE     . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18

                                                        ii
X.     PRAYER         . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22

XI.    CERTIFICATE OF COMPLIANCE . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23

XII. CERTIFICATE OF SERVICE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23

XI.    APPENDIX                 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24

                                                       iii
                                     III. INDEX OF AUTHORITIES

Case Law:

Aguirre v. Vasquez, 225 S.W.3d 744 (Tex. App. – Houston [14th Dist.] 2007, no pet.)
      . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20

AKB Hendrick, LP v. Musgrave Enters., 380 S.W.3d 221 (Tex. App. – Dallas 2012,
no pet.)  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19

Butler v. Arrow Mirror & Glass, Inc., 51 S.W.3d 787 (Tex. App. – Houston [1st
Dist.] 2001, no pet.)  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13

Butnaru v. Ford Motor Co., 84 S.W.3d 198 (Tex. 2002) . . . . . . . . . . . . . . . 14, 19

Cardinal Health Staffing Network, Inc. v. Bowen, 106 S.W.3d 230 (Tex. App. –
Houston [1st Dist.] 2003, no pet.)  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14, 15

EMS USA, Inc. v. Shary, 309 S.W.3d 653 (Tex. App. – Houston [14th Dist.] 2010,
no pet.)  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13

EMSL Analytical, Inc. v. Younker, 154 S.W.3d 693 (Tex. App. – Houston [14th Dist]
2004, no pet.)    . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13

G. C. Murphy Company v. Lack, 404 S.W.2d 853 (Tex. Civ. App. – Corpus Christi
1969, writ ref'd n.r.e.) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21

Gray Wireline Serv., Inc. v. Cavanna, 374 S.W.3d 464 (Tex. App. – Waco 2011, no
pet.) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14

Hennigan v. I.P. Petroleum Company, Inc., 858 S.W.2d 371 (Tex. 1993)                                                  . . 20

Henshaw v. Texas Natural Resources Foundation, 147 Tex. 436, 216 S.W.2d 566
(Tex. 1949) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21

John Paul Mitchell Sys. v. Randalls Food Mkts., Inc., 17 S.W.3d 721 (Tex. App. –
Austin 2000, pet. denied) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19

Mann Frankfort Stein & Lipp Advisors, Inc. v. Fielding, 289 S.W.3d 844 (Tex. 2009)
     . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13

                                                              iv
Mendoza v. Fidelity and Guaranty Insurance Underwriter’s Inc., 606 S.W.2d 692
(Tex. 1980) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20

Prudential Ins. v. Financial Rev. Servs., 29 S.W.3d 74 (Tex. 2000)                                         . . . . . . . . 19

Seelback v. Clubb, 7 S.W.3d 749 (Tex. App. – Texarkana 1999, pet. denied) . . . 19

Sentinel Integrity Solutions, Inc. v. Mistras Group, Inc., 414 S.W.3d 911 (Tex. App.
– Houston [1st Dist.] 2013, reh’g overruled (Dec. 19, 2013), review denied (Oct. 3,
2014)        . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14

Tippett v. Hart, 497 S.W.2d 606 (Tex. App. – Amarillo 1973, writ ref’d n.r.e.)
     . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19

Rules and Statutes:

Tex. Bus. & Com. Code § 15.50                             . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12

Tex. Bus. & Com. Code § 15.51                             . . . . . . . . . . . . . . . . . . . . . . . . 12, 14, 16, 17

Tex. Bus. & Com. Code § 15.51(b)                          . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13

Tex. Bus. & Com. Code § 15.51(c)                          . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14

Tex. Bus. & Com. Code § 15.52                             . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12

                                                              v
                       IV. STATEMENT OF THE CASE

      Defendants, John P. Barnett and Integrated Partners, Inc., sold their optical

courier business to The Burks Group, Inc. on August 21, 2009. Just over three years

later, Barnett reassumed complete operational control of the very same optical

courier business without paying one penny.

      This case was brought by The Burks Group, Inc. against John P. Barnett,

Dalrock Transport, L.L.C., and Integrated Partners, Inc., alleging breach of contract,

breach of the covenant not to compete, and tortious interference with contractual

relationships.

      The trial court reformed the Covenant Not to Compete to conform with the

behavior of the promisor, John P. Barnett, at the hearing on Plaintiff’s Application

for Temporary Injunction, which was brought to enforce the Covenant Not to

Compete.

      A jury trial on the tortious interference with contractual relationships cause of

action resulted in a final judgment entered on the jury verdict, which was for the

defendants and denied Plaintiff’s requested relief.

      This appeal is from both the court’s order denying the temporary injunction

and reforming the covenant not to compete, and from the judgment on the tort claim

as against the great weight and preponderance of the evidence.

                                          1
             V. STATEMENT REGARDING ORAL ARGUMENT

      The issues on appeal raise many questions relating to the current status of the

law in the State of Texas. Oral argument may prove helpful in answering the

questions raised in this lawsuit.

                             VI. ISSUES PRESENTED

1.    The Trial Court Erred by Reforming the Covenant Not to Compete at the
Hearing on Plaintiff’s Application for Temporary Injunction.

2.   The Trial Court Erred by Reforming the Covenant Not to Compete to
Conform to the Conduct of the Defendant/Promisor, thereby rendering it
meaningless.

3.   The Trial Court Erred in Denying Plaintiff’s Motion for Judgment Non
Obstante Veredicto and Motion for New Trial in that the Jury Finding on the Issue
of Tortious Interference with a Contract was Against the Great Weight and
Preponderance of the Evidence.

                          VII. STATEMENT OF FACTS

      On August 21, 2009, The Burks Group, Inc. purchased the business owned

and operated by Integrated Partners, Inc., a sophisticated courier service that

delivered optical products from laboratories to dispensaries of optical products, such

as eye doctors. (RR, Volume 13, Exhibit P-1). The purchase price of $750,000.00

was paid in exchange for substantially all of the tangible and intangible assets of

Integrated Partners, Inc., including: (1) the trade name “Integrated Partners”; (2)

good will; (3) customer contracts; (4) customer list; (5) telephone number; and (6)

more, all as set forth in the contract of purchase. (RR, Volume 6, Page 29, Line 4

                                          2
through Page 30, Line 4). The complete terms of the parties’ arrangement are

contained in their Asset Purchase Agreement (“APA”). (RR, Volume 13, Exhibit P-

1). As part of the APA, Integrated Partners, Inc. sold existing courier contracts for

the delivery of optical products it had with Hoya Vision Care, Legends 4.0 Optical

Lab, and Southwest Lens Optical Lab. (RR, Volume 6, Page 43, Line 22 through

Page 44, Line 25; and Volume 13, Exhibit P-1, Exhibit H). Each courier contract

continued on a month-to-month basis after the expiration of the initial term in

accordance with the provision contained within each contract. (RR, Volume 13,

Exhibits P-3, P-4, and P-5). After August 21, 2009, The Burks Group, Inc. entered

into separate individual contracts with David Dreiling, Allen Thomas Georgi, Gerry

Williams, Christopher R. Gonzalez, Kuffour Donkor-Boateng, Suzane A. Thomaz,

Rhenda Gonzalez, Steven J. Green, and Luis Alejandro Fernandez to act as courier

drivers for the business of Integrated Partners. (RR, Volume 6, Page 73, Line 2

through Line 25; and Volume 13, Exhibits P-7, P-8, and P-9). As the APA required

Barnett to dissolve the corporate entity or change the name within six months (which

was never done), the Burks Group, Inc. operated the business known as Integrated

Partners for the next three years under the assumed name “Integrated Partners.”

(RR, Volume 13, Exhibit P-1, Paragraph XXVII; and Volume 2, Page 65, Line 11

through Line 17).

                                         3
      The APA in paragraph XXVIII and “Exhibit M” contained a Covenant Not

To Compete specifically for Barnett, which contained: (1) a stipulation as to the

appropriateness of injunctive relief; (2) a provision for the extension of the three-

year term in the event of Barnett’s violation by “tolling” the restriction period; and

(3) an award of attorney’s fees in the event of a dispute. (RR, Volume 13, Exhibit

P-1, Exhibit M). Barnett agreed individually to restrict his business activities for a

period of three years within the State of Texas by: (1) not engaging in the courier or

“hot shot” business as an investor or employee; (2) by not taking employees -

including its independent contractors - away from The Burks Group, Inc.; (3) by not

soliciting The Burks Group, Inc.’s customers; and (4) by not tampering with

suppliers of The Burks Group, Inc. (RR, Volume 13, Exhibit P-1, Exhibit M).

      After selling his business to The Burks Group, Inc., Barnett took some classes

and seminars in the stock market and real estate investing, and engaged in those

activities until he ran out of money. (RR, Volume 9, Page 24, Line 18 through Page

25, Line 18). Barnett’s employment history after selling his business started with a

roofing company called Healy, where he worked from August 2010 to May 2011.

(RR, Volume 9, Page 26, Line 16 through Line 24). Barnett left Healy to go to work

for Town and Country Roofing Company. (RR, Volume 9, Page Line 2 through Line

10). In response to the question, “Do you have any other employment, initially his

answer was “no”. (RR, Volume 9, Page 27, Line 24 through Page 28, Line 3). Later,

                                          4
Barnett conceded to working for Celerity Logistics. (RR, Volume 9, Page 47, Line

7 through Line 18).

      In October, 2010, just over a year after the APA was entered, Barnett took

employment with Celerity Logistics. (RR, Volume 9, Page 47, Line 13 through Line

15). Celerity Logistics was a courier and “hot shot” business. (RR, Volume 12,

Exhibit B, Page 4, Line 23 through Page 6, Line 8; and Page 17, Line 22 through

Page 21, Line 24). Barnett worked for Celerity Logistics until August 21, 2012, or

exactly the same day Barnett believed was the last day of the Covenant Not to

Compete. (RR, Volume 9, Page 47, Line 7 through Line 18).

      The Confidential Business Review, upon which Plaintiff relied in the asset

purchase, listed four major competitors. (RR, Volume 13, Exhibit P-2, Page 5). The

first, in order of perceived threat, was Marquis Messenger and Edge Logistics, which

are the same company. (RR, Volume 6, Page 36, Line 20 through Line 24). Marquis

Messenger and Edge Logistics later became a company by the name of Tex Express.

Tex Express was then purchased by Beavex. (RR, Volume 6, Page 37, Line 1 through

Line 3). Beavex is the same company that purchased Celerity Logistics. (RR,

Volume 6, Page 37, Line 4 through Line 7).

      Stephen Edward Sullivan, an employee of Beavex (company that acquired

Celerity Logistics in 2012), was previously employed at Celerity Logistics as Senior

VP of sales, in charge of marketing, sales, budget, managing sales team and bringing

                                         5
on board new revenue. (RR, Volume 12, Plaintiff’s Exhibit B, Page 4, Line 23

through Page 7, Line 14). Sullivan knew Barnett worked at Celerity Logistics,

beginning in October, 2010, as a salesman. (RR, Volume 12, Plaintiff’s Exhibit B,

Page 9, Line 18 through Page 10, Line 2). Sullivan acknowledged Celerity Logistics

scheduled and routed deliveries as a courier. (RR, Volume 12, Page 18, Line 4

through Line 22). Additionally, Celerity Logistics, according to Sullivan, provided

“hot shot” services. (RR, Volume 12, Page 20, Line 7 through Page 21, Line 24).

      On August 22, 2012, the day after his termination as an employee of Celerity

Logistics, Barnett through his daughter Peyton Barnett filed an assumed name

certificate in Denton County, Texas to operate a business under the name “Dalrock

Transport.” (RR, Volume 9, Page 74, Line 12 through Line 20; and Volume 13,

Exhibit P-10).

      Barnett knew that in order for his venture to succeed he would need to take

back the three specifically named optical companies whose contracts he had sold to

The Burks Group, Inc. in the APA. (RR, Volume 2, Page 70, Line 20 through Page

71, Line 14; Page 76, Line 5 through Line 10; and Volume 6, Page 19, Line 3 through

Line 22). Barnett immediately initiated a series of clandestine meetings with

customers and drivers of The Burks Group Inc. to induce them into breaching their

respective contracts with The Burks Group Inc. and to form contracts with Dalrock

Transport. (RR, Volume 6, Page 80, Line 6 through Line 20; Page 82, Line 7 through

                                        6
Line 11; Volume 7, Page 188, Line 13 through Line 23; Page 190, Line 19 through

Line 22; and Page 192, Line 10 through Line 14). Specifically, Barnett willfully and

intentionally induced customers, Essilor Laboratories of America, Inc. and its

affiliates, Legends 4.0 Optical Lab, and lastly Hoya Vision Care, who were all under

written contract with The Burks Group, Inc. into breaching those contracts. (RR,

Volume 13, Exhibit P-12; Volume 7, Page 37, Line 6 through Line 11; Page 41, Line

19 through Page 42, Line 7; Page 23, Line 6 through Page 24, Line 12; and Page

42, Line 8 through Line 17).

      Barnett, through Dalrock Transport, started doing business with Legends 4.0

Optical Lab as early as October 1, 2012 by utilizing the services of his former

employer Celerity Logistics to make deliveries, as he had yet to secure drivers for

Dalrock Transport. (RR, Volume 6, Page 123, Line 25 through Page 124, Line 16).

Barnett operated as Dalrock Transport until Dalrock Transport, L.L.C. came into

existence on October 11, 2012. (RR, Volume 6, Page 14, Line 13 through Page 15,

Line 17).

      On October 22, 2012, the entire delivery operation previously purchased by

The Burks Group, Inc. was taken over by John P. Barnett and Dalrock Transport,

L.L.C., including the customers then under written contract with The Burks Group,

Inc. and the drivers also under written contract with The Burks Group, Inc. (RR,

Volume 6, Page 92, Line 13 through Line 16; and Page 93, Line 3 through Line 7).

                                         7
The entire business was taken over and it was not discovered by the principals of

Plaintiff until the take-over of the business had already occurred. (RR, Volume 7,

Page 38, Line 17 through Line 24; and Page 39, Line 16 through Line 20).

      While the three-year term of the Covenant Not to Compete appeared on its

face to have expired at the time of Barnett’s takeover, in fact, Barnett began violating

the Covenant Not to Compete as early as October, 2010, when he began working for

Celerity Logistics, a courier service, with offices in 700 cities nationally, and every

major city in Texas. (RR, Volume 9, Page 50, Line 23 through Line 25; and Volume

12, Exhibit B, Page 17, Line 16 through Page 21, Line 24). This violation was not

only actionable, but it extended the expiration date of the Covenant Not to Compete

for the almost two year period during which Barnett was employed by the courier

service. (RR, Volume 13, Exhibit P-1, Exhibit M).

      The Burks Group, Inc. sought injunctive relief restricting the activities of

Barnett and his newly formed entity, Dalrock Transport, L.L.C. in the place and

manner set out in the Covenant Not to Compete for a time period that is the same

number of days during which Barnett conducted activities contrary to the terms of

the Covenant Not to Compete, and further requested Barnett be enjoined, along with

Dalrock Transport, L.L.C., from engaging in the courier business for such a time as

would equal the number of days the three year covenant was tolled during Barnett’s

employment with Celerity Logistics, Inc. and operation of Dalrock Transport, L.L.C.

                                           8
(CR 9, Page 22). The trial court had other notions and not only denied the temporary

injunction, but reformed the Covenant Not to Compete in the face of Barnett

admitting to using Celerity Logistics to deliver optical product after he was fired by

Celerity Logistics and before he ultimately took over the entire operations of The

Burks Group, Inc. (RR, Volume 2, Page 76, Line 16 through Page 78, Line 4; and

CR 11, Page 31).

      At trial, beginning March 17, 2014, Barnett testified he was acting

individually and on behalf of Dalrock Transport, L.L.C. and admitted to having

interfered with the delivery contracts with optical laboratories for the delivery and

distribution of product as part of the network of Integrated Partners, and his

interference caused the Plaintiff’s loss of the business to him. (RR, Volume 6, Page

19, Line 3 through Line 22; Page 74, Line 4 through Line 11; Page 75, Line 10

through Line 20; Page 121, Line 13 through Line 18; Page 53, Line 3 through Line

25; Page 80, Line 6 through Line 20; Page 82, Line 7 through Line 11; Page 83, Line

1 through Line 12; Page 86, Line 20 through Page 87, Line 18; and Volume 13,

Exhibit P-12). Barnett testified that through his company Dalrock Transport he took

over the entire business he had sold three years before including the drivers, and the

only difference after October 22, 2012 being that the optical companies sent their

checks to him and not The Burks Group, Inc. (RR, Volume 6, Page 91, Line 7

through Page 93, Line 7). Against the weight of Defendant Barnett’s own testimony,

                                          9
the jury found there was no tortious interference with a contract. (CR 14, Page 76).

                    VIII. SUMMARY OF THE ARGUMENT

      The trial court erred in reforming the Covenant Not to Compete at the hearing

on Plaintiff’s application for temporary injunction, as reformation is a final remedy

to be granted after a final hearing on the merits, or at summary judgment. The court

should have maintained its focus on the issue of whether or not to grant the

application for temporary injunction, and not stray from the purpose of the hearing.

Reformation at such an early stage in the litigation is outcome determinative and

completely destroyed Plaintiff’s cause of action for breach of the Covenant Not to

Compete.

      Additionally, the trial court erred in reforming the Covenant Not to Compete

to conform to the Defendant’s conduct, as the promisor openly admitted to violating

the Covenant by taking a job with a competing business only one year into the three

year prohibition. The injunction sought would have maintained the status quo and

allowed Plaintiff to recover his damages for the breach of the Covenant at final trial.

Instead the Covenant was reformed to render it meaningless and gave Defendant the

green light to take back what he had sold just three years earlier.

      Furthermore, the trial court erred in failing to grant a Judgment Non Obstante

Veredicto and in denying Plaintiff’s Motion for New Trial, as Defendant openly

admitted in court to tortiously interfering with Plaintiff’s contractual relationships.

                                          10
Such statements rose above the level of quasi-admissions, and became true judicial

admissions. Any jury verdict finding that Defendant had not tortiously interfered

with the contractual relationships of Plaintiff would have been against the great

weight and preponderance of the evidence.

                                 IX. ARGUMENT

1.  THE TRIAL COURT ERRED IN REFORMING THE COVENANT
NOT TO COMPETE.

      In an attempt to salvage what he could of his business, Plaintiff filed its

application for temporary and permanent injunctive relief.         With a temporary

injunction in place, Plaintiff could continue to build his existing customer retention

and prevent the annihilation of his business that ultimately occurred.

      While the basic three-year term of the Covenant Not to Compete had expired

at that time, Defendant’s employment by competitor Celerity Logistics triggered the

“tolling” provisions of the Covenant Not to Compete for a period of two years

beyond the term.

      The trial court denied Plaintiff’s request for injunctive relief, and while

Plaintiff did not request the statutory relief of reformation, the trial court’s order

reformed the Covenant Not to Compete in a manner that effectively restricted none

of Defendant’s activities in its hostile and meditated takeover of the business that

the Defendant sold to Plaintiff three years previously and deprived Plaintiff of a jury

                                          11
trial on the issue of whether Defendant violated the Covenant Not to Compete and

should pay damages to Plaintiff.

      The Court’s order reformed the scope of the activity of the Covenant Not to

Compete from its industry-wide exclusion to:

      “… prohibit Defendant JOHN BARNETT between August 21, 2009 and
      August 21, 2012, being employed by any person, venture, partnership
      or other entity that is a courier or “hot shot” business providing
      services only to customers in the optical industry that were actual
      customers of INTEGRATED PARTNERS, INC. between August 21,
      2009 and August 21, 2012.” (CR 11, Page 31)

      To prevail on a cause of action for breach of a Covenant Not to Compete, the

Plaintiff must prove the following:

      1. The parties entered into an enforceable agreement, separate from a
      covenant not to compete;

      2. The covenant not to compete was ancillary to or part of the
      agreement at the time the agreement was made;

      3. The covenant’s limitations were reasonable as to each of the
      following:

            a. time
            b. geographic area
            c. scope of activity to be restrained

      4. The covenant’s limitations did not impose a greater restraint than
      was necessary to protect the promisee’s business interest;

      5. The promisor breached the covenant not to compete. Tex. Bus. &
      Com. Code §§ 15.50-15.52.

                                         12
         However, if the primary purpose of the agreement to which the covenant is

ancillary is different than to render personal services, the promisor has the burden of

establishing that the covenant does not meet those criteria. Tex. Bus. Com. Code §

15.51(b).

         The enforceability of a covenant not to compete is a question of law. Mann

Frankfort Stein & Lipp Advisors, Inc. v. Fielding, 289 S.W.3d 844, 848 (Tex. 2009).

         Tex. Bus. & Com. Code § 15.50 and § 15.51 only govern final remedies and

do not preempt common law relating to temporary injunctions. EMSL Analytical,

Inc. v. Younker, 154 S.W.3d 693, 695 (Tex. App. – Houston [14th Dist] 2004, no

pet.).

         To obtain a temporary injunction, the party seeking the temporary injunction

must plead and prove: (1) a cause of action against the defendant; (2) a probable

right to the relief sought; and (3) a probable, imminent, and irreparable injury for

which there is no adequate legal remedy. EMSL Analytical, at 696; EMS USA, Inc.

v. Shary, 309 S.W.3d 653, 657 (Tex. App. – Houston [14th Dist.] 2010, no pet.)

         To obtain a permanent injunction, the party seeking the injunction must show

that the covenant meets the criteria for enforceability in Tex. Bus. & Com. Code §

15.50. Butler v. Arrow Mirror & Glass, Inc., 51 S.W.3d 787, 795 (Tex. App. –

Houston [1st Dist.] 2001, no pet.).

                                          13
         Injunctive relief is only available to the promisee. Tex. Bus. & Com. Code §

15.51.

         If the court reforms the covenant to make it reasonable, the promisee cannot

recover damages for any breach that occurred before the reformation. Tex. Bus. &

Com. Code § 15.51(c).

A.  THE TRIAL COURT ERRED BY REFORMING THE COVENANT
NOT TO COMPETE AT THE HEARING ON PLAINTIFF’S APPLICATION
FOR TEMPORARY INJUNCTION.

         The purpose of a temporary injunction is to preserve the status quo of the

litigation’s subject matter pending trial on the merits. Butnaru v. Ford Motor Co.,

84 S.W.3d 198, 204 (Tex. 2002); Cardinal Health Staffing Network, Inc. v. Bowen,

106 S.W.3d 230, 235 (Tex. App. – Houston [1st Dist.] 2003, no pet.). However,

reformation under Tex. Bus. Com. Code § 15.51 is a remedy to be granted at a final

hearing, whether on the merits or by summary judgment, and not as interim relief.

Cardinal Health, at 238-39; Sentinel Integrity Solutions, Inc. v. Mistras Group, Inc.,

414 S.W.3d 911, 920 (Tex. App. – Houston [1st Dist.] 2013, reh’g overruled (Dec.

19, 2013), review denied (Oct. 3, 2014); Gray Wireline Serv., Inc. v. Cavanna, 374
S.W.3d 464, 470 (Tex. App. – Waco 2011, no pet.).

         In Cardinal Health Staffing Network, Inc. v. Bowen, Cardinal Health sued

Bowen to enforce a covenant not to compete and for tortious interference, as well as

various other causes of action. Cardinal Health, at 234. The relevant issue before

                                          14
the court was whether or not the procedures of Tex. Bus. & Com. Code § 15.51

preempted the common law requirements for temporary injunction hearings. Id. at

237. The court concluded that the Legislature intended for § 15.51(a) to govern only

final remedies, as it uses the terms “award” and “damages”. Id. at 238. The court

reasoned that § 15.51(b) must therefore logically follow final adjudications and not

apply to the pursuit of preliminary relief. Id. at 238-39.

      In the present case, the Covenant Not to Compete was reformed following the

trial court’s disjointed review of the evidence at a temporary hearing requesting

injunctive relief. The trial court’s attempted reformation of the Covenant Not To

Compete did not occur following a final hearing on the merits, a hearing dedicated

solely to that purpose, or even at a hearing on a motion for summary judgment. The

only issue before the court at hearing was whether or not a temporary injunction

should be issued to prevent Defendant from engaging in the activities prohibited by

the Covenant Not to Compete, thereby preserving the status quo. However, the trial

court committed a fundamental error and decided an issue that was not yet before it,

effectively obliterating Plaintiff’s cause of action for breach of the Covenant Not to

Compete.

      The denial of the application for temporary injunction should have opened the

door to a request for reformation, instead of the court’s reformation closing the door

to the grant of a temporary injunction. Such an overbearing issue requires supportive

                                          15
pleading, notice, briefing, and hearing. It cannot be relegated to a sideshow at a

hearing on an application for temporary injunction, for its disposition is most

certainly outcome determinative. By the time of trial, Plaintiff’s business was

completely destroyed and all the customers and drivers were doing business with

Defendant. The grant of a temporary injunction followed by the grant of a permanent

injunction at the end of trial could have prevented this harm and allowed Plaintiff

the time he needed to protect his business.

       Furthermore, throughout this entire lawsuit, no request has been made by the

promisee to reform the covenant not to compete, which was traditionally required in

Texas to protect the interest of the promisee. As reformed by the trial court, only

one party received any protection, and it is not the one who has historically been

entitled to it.

       Therefore, the trial court erred in reforming the Covenant Not to Compete at

the hearing on the plaintiff’s application for temporary injunction.

B.  THE TRIAL COURT ERRED BY REFORMING THE COVENANT
NOT TO COMPETE TO CONFORM TO THE CONDUCT OF THE
DEFENDANT/PROMISOR, THEREBY RENDERING IT MEANINGLESS.

       Tex. Bus. & Com. Code, § 15.51 allows a trial court to reform a covenant not

to compete:

       “… to the extent necessary to cause the limitations contained in the
       covenant as to time, geographical area, and scope of activity to be
       restrained to be reasonable and to impose a restraint that is not greater
       than necessary to protect the goodwill or other business interest of the

                                          16
      promisee and enforce the covenant as reformed, except that the court
      may not award the promisee damages for a breach of the covenant
      before its reformation and the relief granted to the promisee shall be
      limited to injunctive relief.” Tex. Bus. & Com. Code § 15.51.

      As reformed, John Barnett could not work for a company that serviced only

the customers of Integrated Partners, Inc. (the Defendant) between August 21, 2009

and August 21, 2012. However, Integrated Partners, Inc. sold its customer list to

The Burks Group, Inc. d/b/a Integrated Partners as part of the Asset Purchase

Agreement. Effective on the Closing of the Asset Purchase Agreement, there were

no customers of Integrated Partners, Inc. Therefore, as reformed, Defendant could

have gone to work for anybody, including a company that only serviced customers

in the optical industry, and even if those customers were also customers of Plaintiff.

      The trial court interpreted and reformed the Covenant Not to Compete

completely out of existence, rendered it impotent in protecting Plaintiff’s interests,

and declared open season on Plaintiff’s business, ensuring Defendant could keep

both his business and the Plaintiff’s $750,000.00 purchase price

      Furthermore, the trial court’s reformation meant that Plaintiff could not

recover for damages based on the breach of the Covenant Not to Compete, as the

trial court’s order excluded from the realm of possibility any practical set of

circumstances under which Defendant could have violated the Covenant Not to

Compete.     Although Defendant readily admitted soliciting and inducing the

customers of Plaintiff to terminate their relationship with Plaintiff, the result of the

                                          17
trial court’s reformation was that Defendant had committed no foul, unless Plaintiff

could prove his case for tortious interference, effectively rendering summary

judgment on Plaintiff’s cause of action for the violation of the Covenant Not to

Compete without the inconvenience to the court of the summary judgment

procedure.

      Therefore, the court erred in reforming the Covenant Not to Compete to

conform to the conduct of the defendant/promisor.

2.  THE TRIAL COURT ERRED IN DENYING PLAINTIFF’S MOTION
FOR JUDGMENT NON OBSTANTE VEREDICTO AND MOTION FOR
NEW TRIAL IN THAT THE JURY FINDING ON THE ISSUE OF
TORTIOUS INTERFERENCE WITH A CONTRACT WAS AGAINST THE
GREAT WEIGHT AND PREPONDERANCE OF THE EVIDENCE.

      Not only did Barnett make his own determination that he was not bound by

the Covenant Not to Compete upon its literal expiration, but he also diagnosed

himself as being immune from the consequences of intentionally interfering with

Plaintiff’s business activities. As though to say, “so what? sue me,” Barnett readily

admitted to:

      1.       interfering with the delivery contracts with optical laboratories;

      2.       causing the Plaintiff’s loss of these delivery contracts;

      3.       interfering with the courier driver contracts; and

      4.       using Dalrock Transport to take over the entire business he had sold to

Plaintiff. (RR, Volume 6, Page 91, Line 7 through Page 93, Line 7).

                                            18
      The jury finding that Barnett had not committed tortious interference was

against the overwhelming weight of the evidence. Plaintiff proved liability and

damages through Barnett.

      To prevail on a claim for tortious interference with contractual relationships,

the Plaintiff must prove:

      1. The plaintiff had a valid contact;

      2. The defendant willfully and intentionally interfered with the
         contract;

      3. The interference proximately caused the plaintiff’s injury; and

      4. The plaintiff incurred actual damages or loss. Butnaru v. Ford
         Motor Co., 84 S.W.3d 198, 207 (Tex. 2002); Prudential Ins. v.
         Financial Rev. Servs., 29 S.W.3d 74, 77 (Tex. 2000).

      A plaintiff can prove tortious interference by establishing the defendant

intentionally induced or caused a third party to breach its contract with the plaintiff.

John Paul Mitchell Sys. v. Randalls Food Mkts., Inc., 17 S.W.3d 721, 730-31 (Tex.

App. – Austin 2000, pet. denied). Furthermore, a plaintiff may establish interference

by showing that the defendant prevented performance by making the performance

impossible or more burdensome, difficult, or expensive. See Tippett v. Hart, 497
S.W.2d 606, 610 (Tex. App. – Amarillo 1973, writ ref’d n.r.e.); AKB Hendrick, LP

v. Musgrave Enters., 380 S.W.3d 221, 236 (Tex. App. – Dallas 2012, no pet.);

Seelback v. Clubb, 7 S.W.3d 749, 757 (Tex. App. – Texarkana 1999, pet. denied).

                                          19
      Ordinarily, a party’s testimonial declarations that are contrary to his position

are quasi-admissions. Hennigan v. I.P. Petroleum Company, Inc., 858 S.W.2d 371,

372 (Tex. 1993). But, in this case, as a matter of public policy, Barnett’s testimonial

quasi-admissions should be treated as a true judicial admission in that:

      1.    Barnett’s admissions were made during the course of a judicial
      proceeding;

      2.     Barnett’s admissions are contrary to an essential fact embraced
      in his defense;

      3.    Barnett’s admissions are deliberate, clear, and unequivocal (the
      hypothesis of mere mistake or slip of the tongue must be eliminated);

      4.    the giving of conclusive effect to Barnett’s admissions will be
      consistent with the public policy upon which the rule is based; and

      5.    Barnett’s admissions are not also destructive of the Plaintiff’s
      theory of recovery.

      Aguirre v. Vasquez, 225 S.W.3d 744, 756 (Tex. App. – Houston [14th Dist.]

2007 no pet.).

      Barnett has effectively sworn his defense right out of court by clear,

unequivocal testimony. Mendoza v. Fidelity and Guaranty Insurance Underwriter’s

Inc., 606 S.W.2d 692, 694 (Tex. 1980).

      Barnett’s testimonial evidence was clear and uncontradicted.

      Specifically:

      1.     There were three written Contracts with the optical companies
      each containing a month to month renewal clause and a written notice
      of termination clause. (RR, Exhibits P-3, P-4, and P-5 and Volume 6,

                                          20
Page 53, Line 3 through Line 25);

2.      As a matter of law, each optical company contract was renewed
on a month to month basis that started on the first of the month and
ended on the last day of the month beginning at the expiration of the
initial term of each contract. The courts do not favor forfeitures and
unless compelled to do so by language that will admit no other
construction, forfeiture will not be enforced. G. C. Murphy Company
v. Lack, 404 S.W.2d 853, 858 (Tex. Civ. App. – Corpus Christi 1969,
writ ref'd n.r.e.); Henshaw v. Texas Natural Resources Foundation, 147
Tex. 436, 444, 216 S.W.2d 566, 570 (Tex. 1949);

3.     It was undisputed that not one of the three contracts (RR, Exhibit
P-3, P-4, and P-5) were terminated, and certainly not by written notice
as required by the provision in each contract. Accordingly, each optical
company contract with the Plaintiff was in effect during the period
October 1, 2012 through October 31, 2012;

4.    Barnett knew that Plaintiff was making pickups and deliveries
pursuant to the three optical company contracts October 1, 2012
through October 19, 2012. (RR, Volume 6, Page 59, Line 3 through
Page 60, Line 3);

5.    And Barnett knew the deliveries being made by Plaintiff were
being made pursuant to a written contract, and not an oral contract.
(RR, Volume 6, Page 63, Line 15 through Line 20);

6.    Defendant Barnett convinced the three optical companies to quit
using Plaintiff after October 19, 2012 and thereafter to use Dalrock
Transport, L.L.C. starting October 21, 2012. (RR, Volume 6, Page 80,
Line 6 through Page 88, Line 24);

7.    By way of summary of the entire take over event, Defendant
Barnett testified that Dalrock Transport used the same price structure,
the same physical complex where the drivers collected optical product
for delivery, the same drivers, each driver drove the same route, the
same delivery lock boxes, and agreed that the ONLY (emphasis added)
changes between October 19, 2012 and October 21, 2012 was that after
October 22, 2012 the optical companies sent their checks to Dalrock
Transport, L.L.C. rather than Plaintiff. (RR, Volume 6, Page 91, Line

                                    21
      7 through Page 93, Line 7);

      8.     Defendant Barnett testified that the only changes he brought to
      the optical companies by switching to Dalrock Transport, L.L.C. from
      Plaintiff was he personally contacted the upper level executives he had
      known for many years, became reacquainted with them, and took them
      to lunch. Otherwise, Dalrock Transport was the very same company in
      every respect as Plaintiff had. (RR, Volume 6, Page 95, Line 7 through
      Line 23); and

      9.    Defendant Barnett testified that the value of the company was
      $750,000.00 at the time he took over the company. (RR, Volume 6,
      Page 25, Line 8 through Page 27, Line 2).

      From the testimony of Barnett himself coupled with the contract evidence,

Plaintiff was able to conclusively establish every element of the cause of action and

Plaintiff’s damages. Accordingly, the jury finding to Question 1 was against the

great weight and preponderance of the evidence.

                                    X. PRAYER

      Appellant prays that this Court reverse and render judgment on the claim for

tortious interference with the contracts in the amount of damages equal to

$750,000.00, and remand the case for trial on the issue of lost profits, attorney fees,

and injunctive relief.

      Alternatively, Appellant request that this Court reverse the trial court’s order

denying the temporary injunction and reforming the covenant not to compete, and

remand with instructions to enter an injunction preventing Defendant from engaging

                                          22
in the prohibited activity, and for trial under the Covenant Not to Compete as it

existed prior to reformation.

        Finally, and in the alternative, Appellant respectfully prays reversal and

remand of the entire case for retrial of both causes of action, and for such further

relief, in law or in equity, as the Court deems Appellant justly entitled.

                     XI. CERTIFICATE OF COMPLIANCE

      Pursuant to Texas Rule of Appellate Procedure 9.4(i)(3), I certify that the
foregoing document contains 5127 words, and is in compliance with Texas Rule of
Appellate Procedure 9.4(i)(2)(B).

                                               ____________________________
                                               John R. Jensen

                       XII. CERTIFICATE OF SERVICE

       Pursuant to Texas Rule of Appellate Procedure 9.5, I certify that a copy of the
foregoing Appellant’s Brief was served on April 10, 2015 on the following parties
in the following manner:

      1. Defendants Integrated Partners, Inc., Dalrock Transport, L.L.C., and
         John P. Barnett were served through their attorney of record Brian
         T. Cartwright through the electronic filing manager.

      2. Pro Se Defendant, David Dreiling, was served by first class mail to
         1408 Melody Ln., Carrolton, Texas 75006.

      3. Pro Se Defendant, Allen Thomas Georgi, was served by first class
         mail to 2701 North Grapevine Mills #714, Grapevine, Texas 76051.

                                               ____________________________
                                               John R. Jensen

                                          23
                                   XIII. APPENDIX

Document Name                          Doc. & Page No.      Tab#

Order on Plaintiff’s Application        CR 11 Pg. 31         1
For Temporary And Permanent
Injunction

Charge of Court                         CR 14 Pg. 76         2

Order Denying Plaintiff’s               CR 17 Pg. 114        3
Motion for JNOV

Judgment and Charge of Court            CR 18 Pg. 116        4

Order Denying Plaintiff’s               CR 21 Pg. 256        5
Motion for New Trial

Subchapter E, Chapter 15,                     N/A            6
Title 2, Texas Business &
Commerce Code

Asset Purchase Agreement                RR Vol 13 P-1        7

Contracts                             RR Vol 13 P-1 Ex. H    8

Covenant Not to Compete               RR Vol 13 P-1 Ex. M    9

                                         24
TAB 1

TAB 2

TAB 3

TAB 4

TAB 5

TAB 6
§ 15.50. Criteria for Enforceability of Covenants Not to Compete, TX BUS & COM § 15.50

  Vernon's Texas Statutes and Codes Annotated
    Business and Commerce Code (Refs & Annos)
      Title 2. Competition and Trade Practices
        Chapter 15. Monopolies, Trusts and Conspiracies in Restraint of Trade (Refs & Annos)
           Subchapter E. Covenants Not to Compete (Refs & Annos)

                                                   V.T.C.A., Bus. & C. § 15.50

                             § 15.50. Criteria for Enforceability of Covenants Not to Compete

                                                 Effective: September 1, 2009
                                                          Currentness

(a) Notwithstanding Section 15.05 of this code, and subject to any applicable provision of Subsection (b), a covenant not to
compete is enforceable if it is ancillary to or part of an otherwise enforceable agreement at the time the agreement is made to
the extent that it contains limitations as to time, geographical area, and scope of activity to be restrained that are reasonable and
do not impose a greater restraint than is necessary to protect the goodwill or other business interest of the promisee.

(b) A covenant not to compete relating to the practice of medicine is enforceable against a person licensed as a physician by
the Texas Medical Board if such covenant complies with the following requirements:

  (1) the covenant must:

     (A) not deny the physician access to a list of his patients whom he had seen or treated within one year of termination of
     the contract or employment;

     (B) provide access to medical records of the physician's patients upon authorization of the patient and any copies of medical
     records for a reasonable fee as established by the Texas Medical Board under Section 159.008, Occupations Code; and

     (C) provide that any access to a list of patients or to patients' medical records after termination of the contract or employment
     shall not require such list or records to be provided in a format different than that by which such records are maintained
     except by mutual consent of the parties to the contract;

  (2) the covenant must provide for a buy out of the covenant by the physician at a reasonable price or, at the option of either
  party, as determined by a mutually agreed upon arbitrator or, in the case of an inability to agree, an arbitrator of the court
  whose decision shall be binding on the parties; and

  (3) the covenant must provide that the physician will not be prohibited from providing continuing care and treatment to a
  specific patient or patients during the course of an acute illness even after the contract or employment has been terminated.

(c) Subsection (b) does not apply to a physician's business ownership interest in a licensed hospital or licensed ambulatory
surgical center.

                © 2015 Thomson Reuters. No claim to original U.S. Government Works.                                                1
§ 15.50. Criteria for Enforceability of Covenants Not to Compete, TX BUS & COM § 15.50

Credits
Added by Acts 1989, 71st Leg., ch. 1193, § 1, eff. Aug. 28, 1989. Amended by Acts 1993, 73rd Leg., ch. 965, § 1, eff. Sept.
1, 1993; Acts 1999, 76th Leg., ch. 1574, § 1, eff. Sept. 1, 1999; Acts 2001, 77th Leg., ch. 1420, § 14.729, eff. Sept. 1, 2001;
Acts 2009, 81st Leg., ch. 971, § 1, eff. Sept. 1, 2009.

Notes of Decisions (315)

V. T. C. A., Bus. & C. § 15.50, TX BUS & COM § 15.50
Current through the end of the 2013 Third Called Session of the 83rd Legislature

End of Document                                                   © 2015 Thomson Reuters. No claim to original U.S. Government Works.

               © 2015 Thomson Reuters. No claim to original U.S. Government Works.                                                 2
§ 15.51. Procedures and Remedies in Actions to Enforce..., TX BUS & COM § 15.51

  Vernon's Texas Statutes and Codes Annotated
    Business and Commerce Code (Refs & Annos)
      Title 2. Competition and Trade Practices
        Chapter 15. Monopolies, Trusts and Conspiracies in Restraint of Trade (Refs & Annos)
           Subchapter E. Covenants Not to Compete (Refs & Annos)

                                                  V.T.C.A., Bus. & C. § 15.51

                 § 15.51. Procedures and Remedies in Actions to Enforce Covenants Not to Compete

                                                          Currentness

(a) Except as provided in Subsection (c) of this section, a court may award the promisee under a covenant not to compete
damages, injunctive relief, or both damages and injunctive relief for a breach by the promisor of the covenant.

(b) If the primary purpose of the agreement to which the covenant is ancillary is to obligate the promisor to render personal
services, for a term or at will, the promisee has the burden of establishing that the covenant meets the criteria specified by
Section 15.50 of this code. If the agreement has a different primary purpose, the promisor has the burden of establishing that
the covenant does not meet those criteria. For the purposes of this subsection, the “burden of establishing” a fact means the
burden of persuading the triers of fact that the existence of the fact is more probable than its nonexistence.

(c) If the covenant is found to be ancillary to or part of an otherwise enforceable agreement but contains limitations as to time,
geographical area, or scope of activity to be restrained that are not reasonable and impose a greater restraint than is necessary
to protect the goodwill or other business interest of the promisee, the court shall reform the covenant to the extent necessary
to cause the limitations contained in the covenant as to time, geographical area, and scope of activity to be restrained to be
reasonable and to impose a restraint that is not greater than necessary to protect the goodwill or other business interest of the
promisee and enforce the covenant as reformed, except that the court may not award the promisee damages for a breach of
the covenant before its reformation and the relief granted to the promisee shall be limited to injunctive relief. If the primary
purpose of the agreement to which the covenant is ancillary is to obligate the promisor to render personal services, the promisor
establishes that the promisee knew at the time of the execution of the agreement that the covenant did not contain limitations
as to time, geographical area, and scope of activity to be restrained that were reasonable and the limitations imposed a greater
restraint than necessary to protect the goodwill or other business interest of the promisee, and the promisee sought to enforce
the covenant to a greater extent than was necessary to protect the goodwill or other business interest of the promisee, the court
may award the promisor the costs, including reasonable attorney's fees, actually and reasonably incurred by the promisor in
defending the action to enforce the covenant.

Credits
Added by Acts 1989, 71st Leg., ch. 1193, § 1, eff. Aug. 28, 1989. Amended by Acts 1993, 73rd Leg., ch. 965, § 2, eff. Sept.
1, 1993.

Notes of Decisions (109)

V. T. C. A., Bus. & C. § 15.51, TX BUS & COM § 15.51
Current through the end of the 2013 Third Called Session of the 83rd Legislature

               © 2015 Thomson Reuters. No claim to original U.S. Government Works.                                             1
§ 15.51. Procedures and Remedies in Actions to Enforce..., TX BUS & COM § 15.51

End of Document                                            © 2015 Thomson Reuters. No claim to original U.S. Government Works.

              © 2015 Thomson Reuters. No claim to original U.S. Government Works.                                           2
§ 15.52. Preemption of Other Law, TX BUS & COM § 15.52

  Vernon's Texas Statutes and Codes Annotated
    Business and Commerce Code (Refs & Annos)
      Title 2. Competition and Trade Practices
        Chapter 15. Monopolies, Trusts and Conspiracies in Restraint of Trade (Refs & Annos)
           Subchapter E. Covenants Not to Compete (Refs & Annos)

                                                 V.T.C.A., Bus. & C. § 15.52

                                             § 15.52. Preemption of Other Law

                                                         Currentness

The criteria for enforceability of a covenant not to compete provided by Section 15.50 of this code and the procedures and
remedies in an action to enforce a covenant not to compete provided by Section 15.51 of this code are exclusive and preempt
any other criteria for enforceability of a covenant not to compete or procedures and remedies in an action to enforce a covenant
not to compete under common law or otherwise.

Credits
Added by Acts 1993, 73rd Leg., ch. 965, § 3, eff. Sept. 1, 1993.

Notes of Decisions (8)

V. T. C. A., Bus. & C. § 15.52, TX BUS & COM § 15.52
Current through the end of the 2013 Third Called Session of the 83rd Legislature

End of Document                                                    © 2015 Thomson Reuters. No claim to original U.S. Government Works.

               © 2015 Thomson Reuters. No claim to original U.S. Government Works.                                                  1
TAB 7
TAB 8
TAB 9