That's a Piata! has been providing high end, top-quality piatas to all of San Antonio's fashionable Fiesta events for years, becoming a city icon. Its owner, Jos, has an employment contract with his top papier-mch artist, Fernando, which states that if Fernando leaves iThat's a Piata!, he cannot work for any competitor and the clause remains effective even if the business is sold to new owners. Jos decides to sell business to Janet and retire. The contract for the sale of the business includes a clause that Jos shall not open a business that competes with iThat's a Piata! anywhere in the San Antonio metropolitan area for three years One year after selling the business, Jos realizes he has become bored and longs to be back in the exciting world of piatas. He opens up a small store, calls it iPiatas or Bust! and gives his old friend Fernando a call, convincing him to come over and work for him. When word hits the streets that Jos is back in business with Fernando, Janet's customers abandon her store in droves and start doing their piata shopping at jPiatas or Bust! Janet is understandably upset and wants to sue both Jos and Fernando for breach of contract. What is the likely outcome? The covenant to not compete against Jos as part of the sale of a business is reasonable in its scope (time and location) and the covenant to not compete against Fernando as part of an employment contract is also reasonable and the contract states it continues on even if the business passes on to a new owner. Janet will prevail in both causes of action Covenants to not compete are considered restraints of trade and therefore in contradiction to public policy, so they are never enforced. Janet will lose both causes of action The covenant to not compete against Jos as part of the sale of a business is reasonable in its scope (time and location) but the covenant to compete against Fernando is unreasonable since it has no limit and could theoretically tie Fernando to the company forever. Janet will win one and lose the other cause of action Parties are free to contract whatever they choose.. In this case, Jos agreed to a three year limitation, so he is bound by that agreement. He has breached the contract. Likewise, Fernando agreed to the noncompete clause, so he is also bound by his agreement. Since he chose to go work for another company, he is in clear breach of his contract. Janet will prevail in both causes of action