Choice-of-Law Provision in Non-Compete Upheld
March 24, 2014Although the non-competition agreement at issue in this case contained a choice-of-law provision designating that Texas law would apply, the trial court applied California law to determine the plaintiff’s claims. The Court of Appeal, however, reversed the trial court’s decision on this point, because Texas did, in fact, have a “substantial relationship to the parties or the transaction” at issue. Specifically, although the defendant, a former executive of plaintiff (a Texas company) moved to California after being hired, the evidence established that he (1) had an office in Texas at which he often worked; (2) negotiated the contract, at least in part, in Texas; and (3) performed the contract (in part) in Texas.
