Non-compete clause — accepted job with competitor in Texas

I'm a senior software developer in Dallas. I left my previous employer (a SaaS company) two months ago and just accepted a position at a competitor. The problem is, I signed a non-compete agreement when I was hired at my old company three years ago.

The non-compete says: I can't work for a competing company within a 50-mile radius for 2 years after leaving. The definition of "competing company" is pretty broad — basically any company that develops software in the same market segment.

My old employer found out about my new job (probably through LinkedIn) and sent me a cease-and-desist letter threatening to sue for breach of the non-compete. I really need this new job — it's a 35% pay increase and a much better role. What are my options?

Non-competes in Texas are governed by Texas Business & Commerce Code Section 15.50, and the good news is that Texas courts apply a reasonableness standard that may work in your favor.

For a non-compete to be enforceable in Texas, it must:

• Be ancillary to an otherwise enforceable agreement (usually an employment agreement with consideration like access to trade secrets, confidential information, or specialized training)
• Contain reasonable limitations on time, geographic area, and scope of activity
• Not impose a greater restraint than necessary to protect the employer's legitimate business interests (goodwill and trade secrets)

Analyzing your specific situation:

• 2 years is on the longer end but not automatically unreasonable in Texas. Courts have upheld 2-year non-competes, but they look at it in context.
• 50-mile radius is generally reasonable for a geographic restriction.
• The broad definition of "competing company" is your strongest argument for unenforceability. If it's so broad that it essentially prevents you from working in your field, Texas courts are likely to narrow it. Under Section 15.51, courts have the power to reform an overly broad non-compete rather than void it entirely — but reformation usually results in more reasonable terms.

Key question: Did you have access to genuine trade secrets, customer lists, or proprietary information at your old employer? If your role was purely development work without access to confidential business strategy or customer data, the employer may struggle to show a legitimate protectable interest.

AttorneyBrianCooper — I had access to the codebase but not to customer lists, pricing strategy, or business development plans. I was a developer, not a manager or sales person. I know how their software works technically, but so does anyone who uses the product.

The "competing company" definition in the agreement basically covers any company that develops CRM software. That's hundreds of companies. It would essentially ban me from the entire CRM industry for two years, which feels absurdly broad.

I'm a paralegal at a Texas employment firm and we see these cases all the time. A few observations:

Most non-compete threats never result in actual litigation. The cease-and-desist letter is a pressure tactic. Many employers send them hoping the employee will back down, but filing a lawsuit is expensive and uncertain. That said, some employers do follow through, especially larger companies with in-house counsel.

The trend in Texas courts over the past few years has been toward narrower enforcement of non-competes, particularly for technical employees who don't have direct customer relationships. The Texas Supreme Court's decision in Marsh USA Inc. v. Cook established that non-competes must be tied to specific protectable interests, not just preventing competition generally.

I'd strongly recommend getting a Texas employment attorney to review your specific agreement. Many will do a one-hour consultation for a flat fee and can give you a realistic assessment of enforceability and risk.

Based on your additional details, your position is strong. If your role was purely development without access to confidential business information or customer relationships, the employer's protectable interest is limited to potentially proprietary code or algorithms. And as you noted, knowledge of how a product works from a technical standpoint isn't a trade secret — it's professional skill and experience, which Texas courts have held is not a protectable interest.

The overbreadth of the "any CRM company" definition is also a significant weakness. Even under Texas's reformation doctrine, a court would likely narrow this substantially.

My practical recommendation: respond to the cease-and-desist through counsel explaining why the non-compete is unenforceable as written. This often ends the matter. If the old employer pushes forward, you may need to file a declaratory judgment action asking the court to rule the non-compete unenforceable. This puts you in the driver's seat rather than waiting to be sued.

Went through this in Austin two years ago. Almost identical situation — developer, broad non-compete, joined a competitor. My old employer sent a C&D, my attorney responded with a letter explaining why the non-compete was overbroad, and I never heard from them again. Total legal cost was about $2,500 for the attorney consultation and response letter.

Also, make sure to tell your new employer about the non-compete if you haven't already. Larger companies often have legal teams that will help defend you or at least factor it into their risk assessment. My new employer's legal team actually offered to indemnify me, which gave me a lot of peace of mind.