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Houston Business & Commercial Law Blog

How to avoid partnership disputes in Texas

As is the case with any close relationship, disputes often arise between business partners in Texas, and elsewhere. When this happens, it can significantly affect business and, sometimes, may have an adverse effect on your bottom line. At The Jackson Law Firm, people often ask us how they can avoid partnership disputes. As such, we will discuss some tips for how to handle disagreements between business partners.

If you and your partner are having a dispute, one of the first things to do is to determine what is at the root of the issue. Sometimes, such disagreements are related to business and operations matters. In other cases, however, the issues may be associated with other, personal issues. Before you can begin to work through such matters, it is important to determine what exactly is causing the dispute.

Man who allegedly violated wage and hour laws to serve jail time

Most people in Texas, and elsewhere, are aware that disputes with employees can be costly and disruptive to business. What many do not realize is that business owners who violate state or federal laws could also face serious legal ramifications. In addition to being ordered to pay restitution, or other damages, employers may also be sentenced to a jail or prison term.

According to reports, a New York City businessman is facing serious consequences after he allegedly violated state and federal wage and hour laws. The man owns, and with his business operated, nine Papa John’s franchise locations. Officials with the U.S. Department of Labor and the New York attorney general’s office purport that workers at the man’s restaurants regularly worked overtime, but were not paid time-and-a-half for those hours. News reports alleged that he, and his business, also took steps to cover up the underpayments.

What recourse do you have for broken confidentiality agreements?

As a business owner or professional in Texas, you may have business-related information you want to keep confidential. As such, you may ask your employees or those with whom you work to sign confidentiality agreements. According to Black’s Law Dictionary, these types of agreements stipulate that the signer keep information confidential, and return any documents as requested.

Perhaps the most obvious way for you to handle a breach of confidentiality is to terminate the offending worker’s employment. Typically, you will be well within your legal rights to fire an employee who has violated this type of agreement. If you have an employment contract in place, it is advisable to check the fine print before making your decision. Often times, however, if employees have breached confidentiality agreements, they have also likely breached their employment contracts.

Enforcing business contracts in the state of Texas

Companies in Texas, and elsewhere, commonly use contracts in nearly every facet of their businesses. Whether oral or written, informal or formal, both sides generally expect each other to uphold their side of these agreements. When one side, or the other, fails to fulfill their obligations, contract disputes may arise. As such, it behooves people to understand when Texas business contracts are enforceable to help avoid these types of issues.

In order to be legally binding, business contracts in Texas must have certain elements. The state’s Comptroller of Public Accounts points out that these elements include the following:

  •        A legal objective or purpose
  •        An offer
  •        An acceptance of the offer’s terms
  •        A meeting of the minds, or mutuality of obligation
  •        Consideration

Protecting intellectual property in Texas

The term intellectual property covers a wide range of creations. These may include artistic and literary works; inventions; and images, names and symbols that are used in business dealings. Failing to adequately protect such creations of the mind, however, may cost people in Texas, and elsewhere, the opportunity to capitalize on their work. In fact, the STOPfakes.gov website reports that the sale of counterfeit goods cost companies across the U.S. between $200 billion and $250 billion each year. In order to avoid such losses, and potential business disputes, it is important for business owners to understand how to protect their intellectual property.

Those who create and own intellectual property have a number of rights to protect their works. Some of these options include filing trademarks, copyrights and patents, as well as registering designs. In general, trademarks provide protection for brands, including logos and trade names. Copyrights may be obtained to safeguard the expression of a business’, or a person’s ideas. Patents are generally used to protect new inventions, particularly how they function. Registering a design, on the other hand, may serve to protect a product’s appearance. The PLOS Computational Biology journal points out that these measures are defensive in nature. As such, they do not necessarily prevent intellectual property infringement. Rather, they offer businesses with the right to take legal action in the event that an infringement occurs. 

What are non-compete clauses and when should you use them?

Businesses in Houston, and throughout Texas, often include non-compete clauses in their employment contracts, or ask their employees to sign stand-alone covenants not to compete. While these types of contracts can be useful, they are not appropriate for every situation. At The Jackson Law Firm, people frequently ask us about the pros and cons of non-compete agreements. In this post, we will discuss what these contracts are, and when you should use them.

Non-compete agreements are a type of contract clause that prohibits a worker from competing against your company after leaving your employ. When an employee signs these types of contracts, he or she agrees not to work for a competitor, or in a similar trade, for a specific period of time. Typically, the term for covenants not to compete is between 12 and 24 months. For some, however, these periods may be extended.

What allowances do Texas employers have to make for new mothers?

As an employer in the state of Texas, you are likely aware that there is the potential for your female employees to become pregnant. State and federal laws that offer other employee protections also stipulate some of your responsibilities with regards to expecting, and new, mothers. In order to avoid potential employment litigation, it is important for you to understand the minimum allowances that you must make for new parents.

The Federal Family and Medical Leave Act, or FMLA, specifies the amount of time that eligible workers must be allowed to take off following the birth of a child. According to the Department of Labor, you must allow your employees up to 12 weeks of leave. Their jobs must be protected during this time; however, you are not required to pay workers during these 12 weeks.

Is Houston really free of zoning laws?

If you are a commercial real estate developer in Houston, Texas, you may find that the city provides many unique business opportunities. One thing you may find appealing is the city’s lack of zoning laws. However, according to the Houston Chronicle, the lack of specific zoning laws may not lead to the freedom that you might expect.

Rather than official zoning laws, the city has regulations that are very similar. These are not consistent, though, and the end result is a system that does not provide equal benefits for all of Houston’s residents and businesses. For example, you may discover that many neighborhoods are subject to deed restrictions, which are set by developers so that a commercial property cannot be set up in the middle of the residential community.

What damages are recoverable for breach of contract in Texas?

In the course of your business, you, and other business owners throughout Texas, likely enter into all types of contracts. These may be with workers, equipment or service providers, customers and others. Should a business or person you are working with breach a contract you have entered into together, you may consider taking legal action. For obvious reasons, however, you may not want to resume doing business with a person or business following this type of violation. Aside from having them satisfy their contractual obligations, there are other types of remedies that you may pursue, including monetary damages.

Monetary damages are one of the most common resolutions for contract disputes.  These may include funds to compensate your losses, to compensate your foreseeable losses or to compensate for the time it will take to repair damages resulting from the breach. Under Texas state law, you may also be able to obtain attorney’s fees, in addition to other damages, in breach of contract claims. In general, the amount that you may recover depends on a number of factors, including whether the contract was totally or partially breached, any stipulations the contract may contain regarding breaches, the type of contract and what damages you suffered as a result of the breach.

Business dispute arises between soda companies over use of a word

Many business owners in Texas, and elsewhere, are aware of the importance of logos, color use and branding when it comes to consumer recognition. If a company’s competitor uses similar slogans, logos or colors to market its products, it could confuse customers and take potential business away. Sometimes, business owners will admit their mistake and change the logos or colors. Should companies refuse, however, it could lead to business disputes.

This is the case one specialty soda franchise based in Utah is dealing with. The CEO of Swig reportedly alleges that Sodalicious, another local soda company, has copied things from his business plan and is committing trademark infringement. According to reports, both specialty soda companies use the word dirty to describe their flavored drinks. Swig, however, has trademarked the use of the word in this way. Swig’s CEO also claims that Sodalicious copied his company’s pricing.

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