Contract violations could lead to business dispute

It is not unusual for Texas business owners to utilize various contracts when working with outside parties. They may create general employment contracts for employees, partnership agreements, noncompete contracts and nondisclosure agreements. The terms in these documents can often help individuals better protect their intellectual property and other assets associated with their companies. However, when an apparent violation of a contract takes place, a dispute could arise that leads to litigation.

It was recently reported that this type of issue is currently taking place in another state. A company that sells commercial cleaning supplies to various establishments, such as hotels and schools, claims that a former employee violated the terms of a noncompete agreement by starting his own company. The agreement reportedly stated that the man could not work for a competitor for one year after ending his employment with the company.

The man reportedly created his own company, which apparently carries out similar services, while he was still employed by the other business. The initial company claims that it is losing $100,000 in revenue annually due to the man’s business. As a result, the company filed a lawsuit against him.

Though contracts can often do their part to lessen the likelihood of certain conflicts, a dispute could always be a possibility. When an employee, partner or other person or entity fails to follow the terms of an agreement, legal action may be needed to address the violations. If Texas business owners feel that their contracts have not been properly honored, they may want to discuss their concerns and options with their legal counsel.

Source: startribune.com, “Ecolab sues former employee over non-compete agreement”, April 24, 2018