John’s Non-Compete Agreement

John and Anne continued repairing their marriage over the next few months. It was going well. John’s business continued to grow, and he was still receiving a steady and growing paycheck from his employer. However, John’s employer discovered that he was selling software services on the side in violation of a non-compete agreement.

John immediately told Anne about the cease and desist letter. She accepted it with grace, and simply asked about his plan to deal with the news. Her confidence in her husband had grown since he was able to save the house. Surely he could negotiate this new obstacle.

After sending the letter to his Frisco business attorney, John made an appointment to discuss the matter with him. The attorney asked, “Did you sign a non-compete agreement?” John admitted that he had signed the non-compete agreement and provided a copy of his employment agreement to the attorney.

“Are you selling similar software services as your employer?” the attorney asked. John appreciated the fact that the attorney did not seem annoyed at his concealment of the fact when he had formed the business.

“Yes,” John admitted. “More or less. My business primarily sales to government agencies, though, instead of private businesses.”

The Frisco business attorney reviewed the paperwork. The non-compete was tight, and a lawsuit would be expensive for John. “The non-compete is likely good,” the attorney began explaining, “You have three choices. You can either ignore the notice and see if they’ll actually sue you. Your second choice is to shut down your business. The third option is to settle with them.”

John thanked the attorney for the advice and discussed the matter with Anne. Anne was different now. She had learned to slow down and not get overly excited at the slightest hint of trouble. John was different, too. Their troubles had matured them.

“What do you want to do?” she asked.

“If we had the money, then I would settle with them. I would like to focus on my business. It’s doing well, but it produces a little less than half of my salary on a monthly basis.”

Anne smiled and said, “I would like to help you with that.”

“How could you do that?” John wondered aloud.

 “I own fifty percent of a vacant tract of land in Collin County,” Anne remarked with the slightest bit of hesitation. “Caleb gave it to me. I could ask him to buy me out. It would probably net $100,000.”

John was taken back equally by the fact that Caleb had given her land and by the directness of the admission and offer. It stunned him, and Anne saw his stunned look.

“I should have told you sooner,” she confessed, “but it was awkward.”

John replied as he sat down on the sofa, “It did not seem very awkward for you to say it just now.”

“I don’t want to make a big deal about it,” Anne tried to explain. “You already know about Caleb. I’ve told you all about our relationship except for the land. I would have told you, but I didn’t want you to feel any less about yourself.”

“Did he ask you to marry him?”

“Why would you ask me that?” Anne answered as though she was offended.

Yet John persisted. “Because he gave you valuable land. I’m sure that’s not something he’s in the habit of doing.”

Anne hesitated. Then she closed her eyes and folded her hands. “Yes,” she admitted. “And I accepted. But then I realized that I did not love Caleb. I loved how he filled a void.”

“Void. Do you mean the void of money?”

“I love you!” she exclaimed.

“You just couldn’t live with me while we were poor?” John retorted.

“That’s not true. I would have come back regardless of the situation. It’s just the timing is all.”

“I’m not going to accept his money. You need to give it back to him.”

“It was a gift,” she adamantly explained.

“It was not a gift.”

“Then what was it?” she asked, daring John to say it aloud.

“You know exactly what it was.”

Anne did two things the following day. First, she called her Frisco attorney and demanded that she complete the divorce. Second, she called a real estate attorney to sell her interest in the Collin County property.

Upon the finalization of the divorce, Anne relinquished any right she had in John’s business and their house. John relinquished any right that he had in the Collin County property. They split custody of the children.

After the divorce was finalized, John’s Frisco business attorney settled the dispute regarding the non-compete agreement. It required him to quit his job, but he was able to pursue the dream of owning his own business without fear of reprisal.

I am Robert Newton of The Law Office of Robert Newton, P.C., and I am the author of this series entitled The Impact of Law, in addition to being a real estate, business, and estate planning attorney in Frisco, Texas. While the characters and the circumstances are fictional, they represent a very realistic scenario. If you need to form a Texas limited liability company, please contact an attorney. None of the information contained within the story represent legal advice. Actually, in many cases, it would be very bad legal advice. So, seek the advice of an attorney. And, stay tuned for the next chapter!