## Facts

- Wackenhut Corporation hired Edward DeSantis in 1981 as its Houston area manager.
- DeSantis signed a noncompetition agreement barring competition for two years after termination within a 40-county South Texas area and selecting Florida law to govern the agreement.
- DeSantis resigned and formed Risk Deterrence, Inc. (RDI), offering security consulting and guard services.
- DeSantis sent announcements to potential clients, including current Wackenhut customers; at least one customer switched to RDI and another planned to do so within six months.
- The trial court applied Florida law, found the covenant valid but geographically overbroad, reduced the territory to 13 counties, and enjoined DeSantis and RDI for the remainder of the two-year period.
- The trial court denied DeSantis’s counterclaims for wrongful injunction, fraud, tortious interference, and violation of the Texas Free Enterprise and Antitrust Act of 1983; the court of appeals affirmed.

## Issues

1. Whether Texas conflict-of-laws principles require honoring the contract’s Florida choice-of-law clause to determine enforceability of the noncompete.
2. Whether the noncompetition agreement is enforceable under the law properly applicable to the dispute.
3. If the covenant is unenforceable, whether DeSantis and RDI can recover damages for wrongful injunction, fraud, tortious interference with contract, or violation of the Texas Free Enterprise and Antitrust Act of 1983.

## Decision

- The Supreme Court of Texas held Texas law, not Florida law, governs enforceability of the covenant.
- Applying Texas law, the court held the noncompetition agreement unenforceable.
- The court reversed the injunction and rendered judgment denying DeSantis and RDI damages on all counterclaims.

## Legal Principles

- Under Restatement (Second) of Conflict of Laws § 187, a contractual choice-of-law clause may be disregarded when the forum has the most significant relationship and a materially greater interest, and applying the chosen law would contravene a fundamental forum policy.
- Texas has a strong public policy limiting employee noncompetes that unduly restrain competition and employee mobility within Texas.
- A Texas noncompete must be reasonable and tied to a legitimate, protectable interest (e.g., trade secrets, confidential information, or special customer goodwill); broad restraints unsupported by such interests are unenforceable.
- A later determination that an injunction rested on an unenforceable covenant does not, by itself, establish a claim for damages absent proof of an independent tort or statutory violation.
- Enforcement efforts through ordinary litigation, without proof of actionable fraud, tortious interference elements, or anticompetitive conduct within the antitrust statute, do not support damages.

## Conclusion

Texas refused to apply Florida law chosen in an employment noncompete because Texas had the greater interest and a fundamental policy against unreasonable restraints on employees; under Texas law the covenant was unenforceable, and the employee recovered no damages for the employer’s attempted enforcement.


DeSantis v. Wackenhut Corp., 793 S.W.2d 670 (Tex. 1990)