American Surgical Assistants, Inc., D/B/A American Surgical Professionals v. George Villareal ( 2020 )


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  •                             NUMBER 13-19-00221-CV
    COURT OF APPEALS
    THIRTEENTH DISTRICT OF TEXAS
    CORPUS CHRISTI – EDINBURG
    AMERICAN SURGICAL ASSISTANTS,
    INC., D/B/A AMERICAN SURGICAL
    PROFESSIONALS                                                             Appellant,
    v.
    GEORGE VILLAREAL,                                                         Appellee.
    On appeal from the 117th District Court
    of Nueces County, Texas.
    MEMORANDUM OPINION
    Before Chief Justice Contreras and Justices Longoria and Perkes
    Memorandum Opinion by Justice Longoria
    Appellant American Surgical Assistants, Inc. (American) perfected an appeal from
    a take-nothing judgment rendered against it and in favor of appellee George Villareal.
    American filed suit under the Covenants Not to Compete Act (the Act) for reformation and
    injunctive relief to enforce noncompete covenants against Villareal. See TEX. BUS. & COM.
    CODE ANN. §§ 15.50–.52. The trial court granted a temporary restraining order against
    Villareal, then subsequently dissolved the temporary restraining order and denied
    American’s application for a temporary injunction. After a bench trial on the merits, the
    court rendered final judgment on April 26, 2019, denying all relief sought by American
    and awarding attorney’s fees to Villareal. By seven issues, American generally contends
    that the trial court erred by not reforming the covenants to render them enforceable
    (issues 1 and 4), concluding that the noncompete covenants were not enforceable (issues
    2 and 3), and awarding attorney’s fees (issues 5 through 7). We affirm.
    I.     BACKGROUND
    American provides surgical assistants to surgical facilities and physicians. Villareal
    had worked as a surgical assistant in the military and after his service, he worked to obtain
    his certification as a surgical assistant through the National Surgical Assistant
    Association. Villareal then began working for American as a surgical assistant in
    November 2009. American claims that during his employment at American, Villareal
    received confidential information pertaining to American’s operations, performance,
    contracts with facilities, objectives and initiatives for improving or increasing its business,
    and financial condition. American also claims that Villareal’s access to American’s clients
    and the patients of those clients necessarily includes access to confidential information.
    Upon his employment with American, Villareal signed an employment agreement which
    also contained a confidentiality agreement, both of which included covenants not to
    compete, non-solicitation agreements, and confidentiality provisions. The employment
    2
    agreement contained the following relevant language in a “Confidentiality and Non-
    Competition” section:
    Assistants shall not directly or indirectly offer his/her services as described
    in the attached job description or engage in doing business within an
    extended radius of Five Miles from the present address of [American] at
    10039 Bissonnet #250, Houston, Texas 77036 and/or the address of any of
    its client institutions. This covenant shall remain in force for the duration of
    this Agreement and for a period of Two Years from date of termination of
    Agreement.
    The confidentiality agreement, in part, stated:
    3. Non-Competition and Non-Solicitation The Employee/Independent
    Contractor/PRN acknowledges that he or she will acquire considerable
    knowledge about, and expertise in, certain areas of the Employer/
    Contractor’s business and that he or she will have knowledge of, and
    contact with, customers and suppliers of the Employer/Contractor and its
    Affiliates (as hereafter defined). The Employee/ Independent Contractor/
    PRN further acknowledges that he or she may well be able to utilize such
    knowledge and expertise, following termination of his or her service with the
    Employer/Contractor, to the serious detriment of the Employer/Contractor
    in the event that the Employee/Independent Contractor/PRN should solicit
    business from customers of the Employer/Contractor or its affiliates.
    Accordingly, the Employee/Independent Contractor/PRN agrees that:
    (a)    Non-Competition. During his or her employment and for a
    period of two (2) years after termination of his or her
    employment, the Employee/Independent Contractor/PRN
    shall not in any way offer his or her services to any of
    [American’s] client institutions or client surgeons.
    (b)    Non-Solicitation of Customers. He or she will not, for a
    period of two (2) years after termination of his or her
    employment, directly or indirectly, approach any customer or
    business partner of the Employer/Contractor or its Affiliates
    for the purpose of providing services substantially similar to
    the services provided by the Employer/Contractor or its
    affiliates; and
    (c)    Non-Solicitation of Employee/Independent Contractor/
    PRNs. He or she will not for a period of two (2) years after
    termination of his or her employment, directly or indirectly,
    approach, solicit, entice or attempt to approach, solicit or
    entice any of the other Employee/Independent Contractor/
    3
    PRNs of the Employer/Contractor or its Affiliates to leave the
    employment of the Employer/Contractor.
    The employment agreement began on November 30, 2009, and was “for an initial period
    of one year unless either party notifies the other of his/her intent to terminate the
    Agreement, in writing, with a fifteen days advance notice.” American and Villareal
    renewed the agreement eight times before Villareal resigned in October 2018. Villareal
    then began working for Universal Surgical Assistants, Inc. (Universal). American, alleging
    that Villareal was in violation of his signed agreements with American, filed suit under the
    Act for reformation and injunctive relief to enforce the agreements between the parties.
    American sought a temporary restraining order, temporary injunction, reformation of the
    covenants, and a permanent injunction to enforce the covenants as reformed. The
    temporary restraining order was granted, and subsequently expired under its own terms.
    The case was then tried to the bench and the trial court rendered final judgment denying
    American’s requested relief and awarding attorney’s fees to Villareal. This appeal
    followed.
    II.    ENFORCEABILITY
    The Act governs the enforceability of noncompetition agreements. See TEX. BUS.
    & COM. CODE ANN. §§ 15.50–.52. The enforceability of a covenant not to compete is a
    question of law. Mann Frankfort Stein & Lipp Advisors, Inc. v. Fielding, 
    289 S.W.3d 844
    ,
    848 (Tex. 2009). We review the trial court’s determinations of questions of law on a de
    novo basis. Barber v. Colo. Indep. Sch. Dist., 
    901 S.W.2d 447
    , 450 (Tex. 1995).
    Section 15.50 provides in relevant part:
    Notwithstanding Section 15.05 of this code, and subject to any applicable
    provision of Subsection (b), a covenant not to compete is enforceable if it is
    ancillary to or part of an otherwise enforceable agreement at the time the
    4
    agreement is made to the extent that it contains limitations as to time,
    geographical area, and scope of activity to be restrained that are reasonable
    and do not impose a greater restraint than is necessary to protect the
    goodwill or other business interest of the promisee.
    TEX. BUS. & COM. CODE ANN. § 15.50(a). The requirement of an “otherwise enforceable
    agreement” is satisfied when the covenant is part of an agreement which contains
    “mutual, nonillusory promises.” Marsh USA, Inc. v. Cook, 
    354 S.W.3d 764
    , 773 (Tex.
    2011). An “otherwise enforceable” agreement “can emanate from at-will employment so
    long as the consideration for any promise is not illusory.” Alex Sheshunoff Mgmt. Servs.,
    L.P. v. Johnson, 
    209 S.W.3d 644
    , 648 (Tex. 2006). A noncompetition agreement must be
    supported by consideration to be enforceable.
    Id. at 651;
    DeSantis v. Wackenhut Corp.,
    
    793 S.W.2d 670
    , 681 n. 6 (Tex. 1990). “Consideration for a noncompete that is reasonably
    related to an interest worthy of protection, such as trade secrets, confidential information
    or goodwill, satisfies the statutory nexus.” 
    Marsh, 354 S.W.3d at 775
    ; see Lazer Spot, Inc.
    v. Hiring Partners, Inc., 
    387 S.W.3d 40
    , 46 (Tex. App.—Texarkana 2012, pet. denied).
    Here, the trial court found that American had “no protectable interest or goodwill
    worthy of protection.” American, however, contends that the record established goodwill
    through the development of “close relationships between surgeons and surgical
    assistants” and that Villareal developed such relationships with American’s surgical
    clients. American also argues that it invested time and money into Villareal’s training so
    that he could develop those close relationships. American claims that Villareal gained a
    potential competitive advantage by learning American’s information about “the pay mix of
    surgeons and facilities.” Because of this, American contends that it has an “interest in
    preventing the diversion of this goodwill to a competitor.”
    5
    A.     Employment Agreement
    Under § 15.51(b), if the employment agreement involves personal services, the
    burden is on the employer to prove that the covenant is necessary to protect its legitimate
    business interests. See TEX. BUS. & COM. CODE ANN. § 15.51(b). Under the common law,
    the employer must prove that the agreement was necessary. Martin v. Linen Sys. for
    Hosps., Inc., 
    671 S.W.2d 706
    , 709 (Tex. App.—Houston [1st Dist.] 1984, no writ). In its
    findings of fact, the trial court found that Villareal did not “approach, solicit, entice, or
    attempt to approach, solicit, or entice [American] employees or customers to leave
    [American]. . .” and that American “did not provide George Villareal with confidential,
    proprietary, or trade secret information.” See Daytona Grp. of Tex., Inc. v. Smith, 
    800 S.W.2d 285
    , 289 (Tex. App.—Corpus Christi–Edinburg 1990, writ denied); see also
    Diesel Injection Sales & Servs. v. Renfro, 
    656 S.W.2d 568
    , 572 (Tex. App.—Corpus
    Christi–Edinburg 1983, writ ref’d n.r.e.). The trial court also found that the covenant failed
    the balancing test of hardship to the promisor and injury to the public, stating that “[e]ven
    if there were a protectable interest or goodwill worth [sic] of protection, which there is not,
    the hardship of protecting such would be outweighed by the harm to the public and
    George Villareal.”
    The Texas Legislature declared that “[e]very contract, combination, or conspiracy
    in restraint of trade or commerce is unlawful.” 
    Marsh, 354 S.W.3d at 770
    (quoting TEX.
    BUS. & COM. CODE ANN. § 15.05(a)). The Supreme Court of Texas has concluded that
    covenants limiting employees’ professional mobility are unlawful restraints of trade under
    this statute unless they fall within the exception created by the Act.
    Id. at 768, 770;
    see
    also
    id. at 782
    (Willett, J., concurring); Forum US, Inc. v. Musselwhite, No. 14-17-00708-
    6
    CV, 
    2020 WL 4331442
    , at *5 (Tex. App.—Houston [14th Dist.] July 28, 2020, no pet. h.)
    (mem. op.). As the court explained, “[u]nreasonable limitations on employees’ abilities to
    change employers . . . could hinder legitimate competition between businesses and the
    mobility of skilled employees.” 
    Marsh, 354 S.W.3d at 769
    . The Act provides that a
    covenant is enforceable only if “it contains limitations as to time, geographic area, and
    scope of activity to be restrained that are reasonable and do not impose a greater restraint
    than is necessary to protect the goodwill or other business interest of the promisee.” TEX.
    BUS. & COM. CODE ANN. § 15.50(a); see
    id. § 15.51(c); see
    also 
    Marsh, 354 S.W.3d at 777
    (“The hallmark of enforcement is whether or not the covenant is reasonable.”);
    
    DeSantis, 793 S.W.2d at 681
    (explaining similar standards of reasonableness that had to
    be met to enforce covenants not to compete at common law).
    American contends the trial court erred in its findings because it has a protectable
    interest in goodwill. American’s contention is based on its argument that Villareal
    developed his relationships with the surgical clients during the time he worked for
    American, and that American invested “time and money into Villar[r]eal’s training in the
    cardiothoracic specialty” that allowed him to develop such relationships. American,
    therefore, argues that the goodwill developed by Villareal accrued to the benefit of
    American.
    Texas law has long recognized that goodwill, although intangible, is
    property and is an integral part of the business just as its physical assets
    are. Alamo Lumber Co. v. Fahrenthold, 
    58 S.W.2d 1085
    , 1088 (Tex. App.—
    Beaumont 1933, writ ref’d); Taormina v. Culicchia, 
    355 S.W.2d 569
    , 573
    (Tex. App.—El Paso 1962, writ ref’d n.r.e.). Goodwill is defined as:
    the advantage or benefits which is acquired by an
    establishment beyond the mere value of the capital stock,
    funds or property employed therein, in consequence of the
    general public patronage and encouragement which it
    7
    receives from constant and habitual customers on account of
    its local position, or common celebrity, or reputation for skill,
    or influence, or punctuality, or from other accidental
    circumstances or necessities, or even from ancient partialities
    or prejudices.
    
    Taormina, 355 S.W.2d at 573
    ; see also BLACK’S LAW DICTIONARY 703 (7th
    ed. 1999) (defining “goodwill” as “[a] business’s reputation, patronage, and
    other intangible assets that are considered when appraising the business .
    . .”).
    
    Marsh, 354 S.W.3d at 777
    –78. Goodwill cannot merely be a blanket assertion by which
    American can limit Villareal’s mobility in his employment. See
    id. at 784
    (Willett, J.,
    concurring) (noting that “the evidentiary record must demonstrate special circumstances
    beyond the bruises of ordinary competition such that, absent the covenant, [appellee]
    would possess a grossly unfair competitive advantage”). While the Act permits a
    noncompete clause, it is only “to the extent it contains limitations as to time, geographical
    area, and scope of activity to be restrained that are reasonable and do not impose a
    greater restraint than is necessary to protect the goodwill or other business interest of the
    promisee.” See TEX. BUS. & COM. CODE ANN. § 15.50(a).
    The trial court’s finding that even if American had goodwill worthy of protection, the
    burden placed on Villareal would outweigh any hardship American would face is not
    contested by American. Although findings of fact are not conclusive when, as in this case,
    a complete reporter’s record is provided, “unchallenged findings of fact are binding on the
    appellate court unless the contrary is established as a matter of law, or if there is no
    evidence to support the finding.” City of Corpus Christi v. Taylor, 
    126 S.W.3d 712
    , 717
    (Tex. App.—Corpus Christi–Edinburg 2004, pet. withdrawn). Instead, American argues
    that the goodwill created between Villareal and the doctors he assisted is goodwill earned
    by American and deserves protection through the noncompete. American further
    8
    contends that the noncompete is needed to protect its investments in Villareal’s
    specialized training in the cardiovascular field as well as to ensure Villareal does not
    disclose the confidential information he received through his employment with American.
    However, the trial court heard evidence that enforcing the covenant would indeed be a
    burden on Villareal as he testified that he would not be able to be employed in his field
    where he lives, and may potentially hinder his ability to perform cardiovascular
    procedures at all. According to Villareal’s testimony, the doctors performing the
    cardiovascular procedures would also be negatively affected as they would be limited in
    assistants in a field where there are not many available. Accordingly, we are bound by
    this unchallenged finding of fact. We conclude that the covenant not to compete here
    would hinder legitimate competition between businesses and the mobility of skilled
    employees and is therefore unenforceable. See 
    Marsh, 354 S.W.3d at 769
    . When a
    covenant not to compete is not necessary to protect the employer’s legitimate business
    interests, it cannot be reformed. See, e.g., Neurodiagnostic Tex, L.L.C. v. Pierce, 
    506 S.W.3d 153
    , 166 (Tex. App.—Tyler 2016, no pet.); 
    Daytona, 800 S.W.2d at 290
    .
    B.    Confidentiality Agreement
    American also attempts to enforce a confidentiality agreement signed by Villareal.
    According to American, Villareal was provided with access to patient information and “the
    status and terms of American’s contract with the Christus Spohn hospital system.”
    American also contends that Villareal attended staff meetings during which he learned
    internal information such as performance data and “the pay mix of each facility’s
    commercial to noncommercial cases in Corpus Christi.” American further argues that
    Villareal was involved in two negotiations with potential client facilities and learned of
    9
    American’s pricing model. In contrast, Villareal contends that he was not provided with
    any confidential information, and even if he were, he did not share any such information
    and thus did not violate the confidentiality agreement.
    The confidentiality agreement defined “confidential information” as:
    information in any form not generally known to the public disclosed to or
    acquired by the Employee/Independent Contractor/PRN directly or
    indirectly from the Employer/Contractor or any clients business partners or
    affiliates of the Employer/Contractor during the term of the
    Employee/Independent Contractor/PRN’s employment/contract with the
    Employer/Contractor, including, without limitation but shall not include any
    information which was known to the Employee/Independent Contractor/
    PRN prior to the date of the Employee/Independent Contractor/ PRN’s
    employment with the Employer/Contractor or which was publicly disclosed
    otherwise than by breach of this Agreement:
    (i)     information relating to the research, developments, systems,
    operations, clients and business activities of the
    Employer/Contractor or its business partners or Affiliates;
    (ii)    information received from any clients, business partners or
    Affiliates of the Employer/Contractor;
    (iii)   information specifically designated       by   the   Employer/
    Contractor as confidential;
    (iv)    information specifically designated by a client, business
    partner or Affiliate of the Employer/Contractor as confidential;
    and
    (v)     information required to be maintained in confidence by the
    Employer/Contractor pursuant to an agreement with a client,
    business partner, associate or other person[.]
    The trial court found that there was no consideration for the confidentiality
    provisions of the employment agreement or for the confidentiality agreement itself and
    that American did not provide Villareal with confidential, proprietary, or trade secret
    information.
    10
    A promise to provide confidential information is illusory and cannot be the basis of
    an “otherwise enforceable agreement” unless (1) the employer promises to deliver the
    confidential information to the employee and (2) the employer actually delivers the
    confidential information at or near the time the employee makes the promise to keep the
    information confidential. Wright v. Sport Supply Grp., Inc., 
    137 S.W.3d 289
    , 297 (Tex.
    App.—Beaumont 2004, no pet.) (finding that employer’s promise to provide confidential
    information was not illusory where, subsequent to signing the agreement, the employer
    made confidential information available to the employee on a daily basis); see TMC
    Worldwide, L.P. v. Gray, 
    178 S.W.3d 29
    , 38 (Tex. App.—Houston [1st Dist.] 2005, no
    pet.). Here, the information that American contends was confidential was regularly
    received by Villareal throughout his course of employment. However, the trial court heard
    testimony that much of the information was ascertainable through sources outside of
    American. Villareal testified that “information that would allow other assistants to know
    what hospitals were surgical assistant friendly, and what hospitals you could potentially
    get work or work for a group” was readily available online through “open resource”
    documents that were “surgical assistant friendly.” Villareal also explained that he was not
    privy to information such as contracts between American and the hospitals or the payment
    information used by American, but that he is aware that American, like all surgical
    assistant groups, goes through insurance for payment. Further, as it relates to patient
    information, the information is protected by the Health Insurance Portability and
    Accountability Act (HIPAA) and no confidentiality provision through his employment with
    American was necessary to protect such information. Accordingly, the trial court had
    evidence before it from which it could have determined that the information received by
    11
    Villareal during the course of his employment was not considered confidential. See
    Edwards v. Pena, 
    38 S.W.3d 191
    , 199 (Tex. App.—Corpus Christi–Edinburg 2001, no
    pet.).
    We overrule American’s first through fourth issues.
    III.   ATTORNEY’S FEES
    In its fifth, sixth, and seventh issues, American contends that the trial court erred
    in awarding attorney’s fees to Villareal. Section 15.51(c) of the Act states:
    If the primary purpose of the agreement to which the covenant is ancillary
    is to obligate the promisor to render personal services, the promisor
    establishes that the promisee knew at the time of the execution of the
    agreement that the covenant did not contain limitations as to time,
    geographical area, and scope of activity to be restrained that were
    reasonable and the limitations imposed a greater restraint than necessary
    to protect the goodwill or other business interest of the promisee, and the
    promisee sought to enforce the covenant to a greater extent than was
    necessary to protect the goodwill or other business interest of the promisee,
    the court may award the promisor the costs, including reasonable attorney’s
    fees, actually and reasonably incurred by the promisor in defending the
    action to enforce the covenant.
    TEX. BUS. & COM. CODE ANN. § 15.51(c). Because the statute provides that “the court may
    award” attorney’s fees, the award of attorney’s fees is within the trial court’s discretion
    and is not mandatory. Spring v. Walthall, Sachse & Pipes, Inc., No. 04–09–00474–CV,
    
    2010 WL 2102988
    , at *11 (Tex. App.—San Antonio May 26, 2010, no pet.) (mem. op.)
    (citing Bocquet v. Herring, 
    972 S.W.2d 19
    , 20 (Tex. 1998) (holding that statutes providing
    that court “may award” are permissive and require abuse of discretion to overturn order
    granting or denying award)). As a predicate to an award of attorney fees under § 15.51(c),
    a plaintiff must prove that (1) defendant knew at the time the employment agreement was
    executed that the covenant did not contain limitations on time, geographical area, and
    scope of activity to be restrained that were reasonable and the limitations imposed a
    12
    greater restraint than necessary to protect defendant’s goodwill or other business interest,
    and (2) defendant sought to enforce the covenant to a greater extent than was necessary
    to protect its goodwill or other business interest. Sentinel Integrity Sols., Inc. v. Mistras
    Grp., Inc., 
    414 S.W.3d 911
    , 924–25 (Tex. App.—Houston [1st Dist.] 2013, pet. denied);
    see also Jackson v. Ali Zaher Enters., LLC, No. 05-18-00288-CV, 
    2019 WL 698019
    , at *2
    (Tex. App.—Dallas Feb. 20, 2019, no pet.) (mem. op.); Spring, 
    2010 WL 2102988
    , at *11.
    The trial court found
    [American] knew at the time of the November 2016 renewal of [the
    employment agreement] that the contractual restrictive covenants did not
    contain limitations as to time, geographical area, and scope of activity to be
    restrained that were reasonable and the limitations imposed a greater
    restraint than necessary to protect any goodwill or other business interest,
    and sought to enforce the contractual restrictive covenants to a greater
    extent than was necessary to protect its goodwill or other business interest,
    if any.
    American argues first that Villareal cannot recover attorney’s fees related to
    American’s request for reformation and enforcement of the restrictive covenants in the
    confidentiality agreement because it is not a contract for personal services. However, the
    trial court found that “the primary purpose of the agreements to which the contractual
    restrictive covenants are ancillary is to obligate the promisor to render personal services.”
    Aside from the mere assertion that the confidentiality agreement is not for personal
    services, American provides no additional argument on this point. We conclude the issue
    has been inadequately briefed. See TEX. R. APP. P. 38.1(i). In any event, the
    confidentiality agreement is part of the employment agreement, which is indisputably for
    the rendering of personal services.
    Next, American contends that there “is no evidence of the two requisites for an
    award of attorney’s fees to Villareal under Section 15.51(c).” The first element Villareal
    13
    was required to prove to recover attorney’s fees was that American knew at the time of
    the covenant’s execution that its restrictions were unreasonable and imposed a greater
    restraint than was necessary. See 
    Sentinel, 414 S.W.3d at 924
    . Villareal’s argument is
    that American knew at the time that the agreement with Villareal was annually renewed,
    based on its previous recent lawsuit, that the restrictions were unreasonable and imposed
    a greater restraint than was necessary.
    The employment agreement renewed annually on November 30, beginning in
    2009, with the last renewal on November 30, 2017, ending with Villareal’s resignation in
    October 2018. The trial court heard testimony, including an affidavit from Villareal’s
    attorney, and took judicial notice of a recent prior lawsuit regarding the enforcement of
    American’s restrictive covenants on a previous employee of American. In American
    Surgical Assistants, Inc. d/b/a American Surgical Professionals v. Juan “Johnny” De Dios
    Villegas, et al., the trial court in the underlying cause entered a take nothing judgment
    against American and found that
    enforcement of the covenant not to compete in Corpus Christi would harm
    the public interest in the Corpus Christi market by resulting in a reduction in
    the quality of health care and continuity of care by depriving surgeons of
    their choice of surgical assistants, which has the effect of depriving the
    public access to surgeons with surgical assistants of superior knowledge
    and skills related to and inherent to their relationships to these surgeons
    and procedures performed. 1
    The trial court in the Villegas matter entered final judgment on February 19, 2016.
    Subsequently, Villareal’s employment agreement renewed twice, with no changes to the
    1 The trial court in the underlying matter in the case at bar took judicial notice of the findings of fact
    and conclusions of law of the trial court in American Surgical Assistants, Inc. d/b/a American Surgical
    Professionals v. Juan “Johnny” De Dios Villegas, et al., cause number 2014-DCV-5282-E, heard in the
    148th Judicial District of Nueces County, Texas. The findings of fact and conclusions of law in that matter
    are part of the record in the case at bar.
    14
    covenant not to compete. American does not dispute that the trial court in the Villegas
    matter previously found the covenants to be unenforceable, but rather argues that
    Villareal failed to prove that American had knowledge of such unenforceability at the time
    the employment agreement was first executed in 2009.
    We disagree that Villareal was required to show American’s knowledge of
    enforceability in 2009. The employment agreement states that the agreement
    will begin on November 30, 2009[,] for an initial period of one year unless
    either party notifies the other of his/her intent to terminate the Agreement,
    in writing, with a fifteen days advance notice. . . . This Agreement shall be
    renewed for equal an [sic] period unless either party notifies the other of
    his/her intent to terminate the Agreement, in writing, with a fifteen days
    advance notice.
    Renewal is defined as “the re-creation of a legal relationship or the replacement of an old
    contract with a new contract, as opposed to the mere extension of a previous relationship
    or contract.” Renewal, BLACK’S LAW DICTIONARY (11th ed. 2019). Each renewal of the
    agreement between American and Villareal constituted a new contract. See
    id. As such, each
    time the agreement was renewed after the Villegas ruling, American had the
    knowledge that the restrictive covenants contained therein were “unreasonable and
    imposed a greater restraint than was necessary.” See 
    Sentinel, 414 S.W.3d at 924
    . We
    conclude this is sufficient to satisfy the first prong under § 15.51(c).
    As to the second prong required under § 15.51(c), American states that Villareal
    did not meet his burden in proving that American sought to enforce the covenant to “a
    greater extent than was necessary to protect the goodwill or other business interest of the
    promisee.” TEX. BUS. & COM. CODE ANN. § 15.51(c). As with the first prong, Villareal
    presented evidence to the trial court that American sought to enforce the same covenant
    in a prior proceeding, and it was determined by the trial court in Villegas that the goodwill
    15
    American sought to protect was goodwill between the surgeon and the surgical assistant
    and did not inure to the benefit of American. Villegas, 
    2017 WL 1284780
    , at *1. American
    was aware that the covenant not to compete contained in Villareal’s employment
    agreement was unenforceable as written, yet American did not change the covenant
    going forward and instead further sought to enforce it against Villareal. Accordingly,
    Villareal met his burden under § 15.51(c) to show that American attempted to enforce the
    covenant to a greater extent than necessary to protect any goodwill it believed it had.
    American’s fifth, sixth, and seventh issues are overruled.
    IV.    CONCLUSION
    The judgment of the trial court is affirmed.
    NORA L. LONGORIA
    Justice
    Delivered and filed the
    8th day of October, 2020.
    16