Most people learn they are being sued on a non-compete when a process server hands them a TRO application with a hearing set a few days out. The new employer is usually named alongside the employee on a tortious interference theory. The papers allege trade secret theft, breach of the covenant, and an assortment of other misconduct, and the relief sought is an order keeping the employee from working at the new job at all.
You have days, not weeks. In that window you have to answer the emergency relief and frame the substantive defense to the covenant, all while deciding whether the employee keeps working at the new employer as the case runs. What follows is how the defense comes together under that clock.
The federal regulatory background
Before turning to defense strategy, the federal regulatory position warrants mention. The FTC’s 2024 rule that would have banned most employee non-competes nationwide was struck down by Ryan, LLC v. FTC in the Northern District of Texas in August 2024. The FTC abandoned its appeal in September 2025, the Fifth Circuit dismissed the appeal that month, and the FTC formally acceded to vacatur in February 2026.
The practical result: Texas non-competes are governed by Texas state law under Chapter 15 of the Business and Commerce Code, exactly as they were before the FTC’s attempted preemption. The federal rule is dead and not expected to return in the foreseeable future. The defense proceeds under Texas law, without federal preemption considerations.
Threshold enforceability challenges
The first line of defense attacks whether the non-compete is enforceable at all under Texas law. The key statutory framework is Texas Business and Commerce Code section 15.50:
Ancillary to otherwise enforceable agreement. The non-compete must be ancillary to or part of an otherwise enforceable agreement at the time the agreement is made. Failure here defeats the non-compete entirely, reformation cannot save a non-compete that fails the threshold requirement.
Common scenarios where the threshold fails:
- At-will employment alone is insufficient. When the non-compete is added to existing at-will employment without new consideration, the threshold may fail.
- Continued employment is not always sufficient consideration. Texas authority on this is more nuanced than some employers realize.
- The “otherwise enforceable agreement” must be itself enforceable. When the underlying agreement is illusory or unenforceable, the non-compete falls with it.
- Adequate consideration must support the agreement. Promises that are illusory or that do not actually obligate the employer fail.
Confidential information consideration. A common pathway to satisfying the threshold requirement involves the employer’s promise to provide confidential information to the employee, with the non-compete protecting against later disclosure or competitive use of that information. Defenses attack:
- Whether the employer actually provided confidential information.
- Whether the information was actually confidential.
- Whether the agreement provided the information as promised.
- Whether the confidential information was actually used in the alleged competitive activity.
Reasonableness challenges
The second tier of defense attacks the reasonableness of the specific restrictions:
Geographic scope. Reasonable geographic restrictions match where the employee actually worked and where the employer’s protectable interests exist. Overbroad restrictions (e.g., entire United States for a regional employee) face reformation.
Time period. Reasonable durations typically range from six months to two years depending on context. Longer durations require specific justification.
Scope of activity. Reasonable restrictions limit the employee from doing what the employee actually did. Broader restrictions covering activities unrelated to the employee’s work face challenge.
Customer scope. When the non-compete restricts customer contact, reasonable scope is typically tied to specific customers the employee actually serviced.
Texas Business and Commerce Code section 15.51(c) requires reformation rather than declaration of unenforceability for overbroad provisions. The court must modify the time, geographic area, or scope of activity to make the restriction reasonable, then enforce as reformed.
Practical consequence of successful reasonableness challenges: Reformation eliminates damages recovery for breaches before reformation, and eliminates attorney’s fees recovery. The plaintiff who only obtains reformation has gotten a narrower injunction without the financial recovery that would otherwise apply.
Defending the TRO and temporary injunction
Non-compete enforcement typically begins with TRO applications. Defending those applications:
Attack the irreparable harm element. Plaintiff must show probable, imminent, irreparable injury. Showing that the alleged harm can be addressed through damages, or that the harm has already occurred and cannot be enjoined, may defeat the temporary relief.
Attack the probable right element. The same enforceability arguments that ultimately defeat the case can show the plaintiff lacks a probable right to relief at the temporary stage.
Attack the Rule 683 form. Plaintiff’s proposed order must satisfy the specificity requirements. Vague proposed orders face Rule 683 challenges.
Push for substantial bond. Texas Rule 684 requires bond protecting against wrongful injunction damages. Substantial bond requirements can sometimes deter plaintiff enforcement.
Develop the legitimate competition narrative. Texas recognizes the right to compete within bounds. Showing that the employee’s conduct is legitimate competitive activity, rather than misappropriation of trade secrets or violation of valid restrictions, supports defense at every stage.
See Responding to a TRO for the broader framework.
The new employer defense
New employers typically face tortious interference claims along with the underlying non-compete claim against the employee. Joint defense considerations:
Coordination of strategy. Joint defense allows unified positioning, sharing of work, and consistent narrative.
Conflict-of-interest evaluation. Joint defense requires careful evaluation of any conflicts between the new employer and the employee. In most cases, interests are aligned, but counsel must confirm.
Tortious interference elements. The plaintiff must show the new employer knew of the non-compete and proceeded with intent to interfere. Defense attacks knowledge, intent, and the underlying validity of the non-compete being “interfered with.”
Practical accommodations. The new employer may modify the departed employee’s duties, location, or customer contact to minimize exposure during the litigation.
See Tortious Interference with Contract.
Counterclaims
Defending non-compete cases sometimes supports counterclaims:
Declaratory judgment. Counterclaim seeking declaration that the non-compete is unenforceable. This converts the defensive posture into affirmative relief.
Tortious interference counterclaim. When the former employer’s enforcement conduct interferes with the employee’s current employment or other relationships.
Defamation or business disparagement. When the former employer has made damaging statements outside the litigation.
Wrongful injunction damages. Through the injunction bond if the injunction is ultimately determined to have been wrongfully obtained.
TCPA dismissal motions when applicable. The TCPA’s exemption for covenants-not-to-compete enforcement actions may limit this in pure non-compete cases, but related claims may still support TCPA practice.
Strategic considerations
Speed matters. Non-compete defense unfolds in days, not weeks. Engaging counsel immediately upon learning of the suit (or anticipated suit) is essential.
Position before the TRO if possible. When the employee knows enforcement is coming, proactive declaratory judgment filing, filing first in a favorable forum to seek declaration of unenforceability, can shift the entire case dynamic. See Filing-First Strategy.
Engage forensic resources when applicable. Trade secret allegations require forensic analysis. Engaging forensic experts early supports both defense and counter-evidence.
Consider the practical employment picture. Sometimes the case settles by modifying the employee’s role or restricting customer contact rather than fighting to a complete win. The practical employment consequences shape settlement positioning.
Plan for the broader litigation. Non-compete cases that do not settle quickly become complex multi-month or multi-year litigation. The early-stage defense should set up the longer case.
Beating the covenant at the threshold
We move on day one. The early work in non-compete defense sets up everything after it. Our first target is threshold enforceability: many covenants fail at the foundation, and a failure caught early produces a complete defense rather than a reformed, narrower restriction. When joint defense fits, we defend the new employer alongside the employee, since their interests usually align and a coordinated front beats a fragmented one. We file declaratory judgment counterclaims and other affirmative theories where they fit, turning defense into offense. And because we enforce these covenants for employer clients too, we know exactly where the enforcement side is weakest.
A covenant that fails the threshold cannot be saved by reformation. That is the cleanest win available in a non-compete case, and it is the first thing we look for.
Frequently Asked Questions
How do you defend against a Texas non-compete lawsuit?
Through challenges to the threshold enforceability of the agreement and to the reasonableness of the specific restrictions. Threshold challenges attack the ancillary-to-otherwise-enforceable-agreement requirement, the consideration adequacy, the scope of confidential information protected, and similar foundational elements. Reasonableness challenges attack the geographic scope, time period, and activity restrictions as broader than necessary to protect legitimate interests. Texas allows reformation of overbroad provisions, so successful reasonableness challenges typically produce reformed (narrower) restrictions rather than complete unenforceability.
Are FTC non-compete rules in effect?
No. The FTC rule banning most employee non-competes was struck down by *Ryan, LLC v. FTC* in the Northern District of Texas in August 2024. The FTC abandoned its appeal in September 2025, the Fifth Circuit dismissed the appeal in September 2025, and the FTC formally acceded to vacatur of the rule in February 2026. The rule never took effect and is no longer subject to litigation. Texas non-competes are governed by Texas state law under Chapter 15 of the Business and Commerce Code as they were before the FTC's attempt to preempt the field.
What is the most common successful defense to a Texas non-compete?
Failure of the ancillary-to-otherwise-enforceable-agreement requirement. Texas Business and Commerce Code section 15.50 requires a non-compete to be ancillary to or part of an otherwise enforceable agreement. When the underlying agreement is itself unenforceable or when the non-compete is not properly ancillary to a separate enforceable agreement, the non-compete fails at the threshold and cannot be saved by reformation. The most common scenario is at-will employment with later addition of restrictive covenants without new consideration.
Can a Texas non-compete be reformed by the court?
Yes, under Texas Business and Commerce Code section 15.51(c). Courts must reform overbroad non-competes to make them reasonable rather than declaring them unenforceable. The court modifies the time, geographic area, or scope of activity to make the restriction reasonable, then enforces as reformed. Important consequence: when reformation is required, the employer cannot recover damages for breaches that occurred before reformation, and cannot recover attorney's fees. Reformation thus produces partial relief but eliminates the strongest enforcement tools.
Should the new employer of a non-compete employee join the defense?
Often yes. New employers are typically sued for tortious interference along with the former employee on the non-compete claim. Joint defense allows coordination of strategy, sharing of resources, and unified positioning. The new employer often has greater financial capacity to fund the defense and stronger motivation to prevail. Conflict-of-interest considerations between the former employee and the new employer need to be evaluated, but in most cases joint defense serves both clients' interests.