Stopco's President is adamant that a departing Stopco employee doesn't take any of Stopco's clients. So Stopco's President came up with a nice, broad non-compete which he made all employees sign upon employment with Stopco. Stopco's non-compete provides:
Employee shall not ... directly or indirectly solicit, accept business from, perform services for or disclose Stopco's confidential information to any individual or entity that Stopco provided products/services for during the period of Employee's employment with Stopco ... regardless of whether Employee dealt with or performed any function for the individual or entity during Employee's employment with Stopco.
Stopco's President figured his non-compete would do the trick, but he figured wrong. A recent Texas Court of Appeals panel held that a non-compete clause similar to Stopco's clause was overbroad and constituted an unreasonable restraint of trade. The Court held a business's non-compete must not only be limited to the performance of work involving products/services substantially similar to that particular business, it must also be limited to customers or individuals with whom the former employee dealt while said employee was employed with said business.
Moral of the story – Stopco's President should not have relied on his own drafting skills. He should have sought legal advice to ensure his non-compete would hold up in court! Based on this opinion, the italicized portion in Stopco's non-compete would be overbroad and unreasonably restrain trade. Consequently, it would not be enforceable.
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