Brett Bihner v. Bihner Chen Engineering, Ltd., Bihner Chen Engineering, GP, LLC and Yubo Chen
01-21-00086-CV
| Tex. App. | Sep 14, 2021Background
- In 2005 Brad Bihner and Yubo Chen formed Bihner Chen Engineering, Ltd.; Brad executed a noncompete (paid consideration) that was assigned to the partnership and its GP.
- Brad transferred his partnership interest to his son, Brett, in 2012; Brett signed a written consent agreeing to be bound by the partnership governing documents and had access to confidential materials.
- Bihner Chen kept a Christmas card list (client/referral names, contacts, gift history) and a fee schedule (pricing guideline); access was limited to Yubo and Brett and company policies described such information as confidential.
- In Sept. 2020 Brett invoked the buy-sell provision; Yubo elected to buy Brett’s interest for $600,000; Brett resigned and—before closing—formed a competing firm, registered a similar domain, and sent holiday cards announcing his new firm.
- Bihner Chen alleged the Christmas list went missing and that Brett solicited clients; it obtained a temporary injunction for breach of the noncompete and trade-secret misappropriation; Brett appealed.
Issues
| Issue | Plaintiff's Argument (Brett) | Defendant's Argument (Yubo/Bihner Chen) | Held |
|---|---|---|---|
| Whether the evidence supported a probable right to relief on trade-secret misappropriation and justified a temporary injunction | No evidence that the Christmas list and fee schedule were trade secrets or that Brett misappropriated them; information was memorized or publicly ascertainable | The materials were confidential, valuable, access was limited, the list went missing, and Brett likely used the information to solicit clients | Affirmed: some evidence supported trade-secret protection and likely possession/use by Brett; temporary injunction not an abuse of discretion |
| Whether the noncompete is unenforceable against Brett because he did not sign or receive consideration | Noncompete unenforceable as to Brett—he never signed it nor received consideration | Enforceability is a merits issue for final judgment and not ripe on interlocutory appeal | Court declined to decide enforceability on appeal; issue reserved for final judgment |
Key Cases Cited
- Abbott v. Anti-Defamation League Austin, Sw., & Texoma Regions, 610 S.W.3d 911 (Tex. 2020) (standard of review for temporary injunctions)
- Henry v. Cox, 520 S.W.3d 28 (Tex. 2017) (scope of review for temporary injunction orders)
- Fox v. Tropical Warehouses, Inc., 121 S.W.3d 853 (Tex. App.—Fort Worth 2003) (trade-secret protection may be preserved at temporary-injunction stage)
- Sw. Energy Prod. Co. v. Berry-Helfand, 491 S.W.3d 699 (Tex. 2016) (definition and misuse of trade secrets; memory rule guidance)
- RSM Prod. Corp. v. Glob. Petroleum Group, Ltd., 507 S.W.3d 383 (Tex. App.—Houston [1st Dist.] 2016) (elements of trade-secret misappropriation)
- INEOS Group Ltd. v. Chevron Phillips Chem. Co., LP, 312 S.W.3d 843 (Tex. App.—Houston [1st Dist.] 2009) (upholding temporary injunction where confidentiality measures shown)
- T-N-T Motorsports, Inc. v. Hennessey Motorsports, Inc., 965 S.W.2d 18 (Tex. App.—Houston [1st Dist.] 1998) (possession of former employer’s confidential info supports likelihood of use)
- Tom James of Dall., Inc. v. Cobb, 109 S.W.3d 877 (Tex. App.—Dallas 2003) (noncompete enforceability is a merits issue reserved for final judgment)
