Keep Your Employees Happy!!

In Providence Title Co. v. Truly Title, Inc., the Fifth Circuit affirmed summary judgment between two Texas insurance competitors, where one company’s new hires from their rival title company brought their clients and colleagues with them, resulting in alleged breaches of their fiduciary duties.

The case arose from a failed merger. After negotiations between Providence and Truly stalled, several Providence executives — including its president — negotiated their way to Truly, coordinated strategic office openings with data gained during merger dealings, and had a former Providence employee organized a “happy hour” that doubled as a group interview with Truly recruiters.

Providence sued Truly for knowingly participating in its executives’ breach of fiduciary duty. The Fifth Circuit affirmed dismissal of all of them. The Court followed the Texas intermediate-court opinion in Crossroads Hospice v. FC Compassus, which held that hiring at-will employees who secretly agreed to compete with their employer, and knowing about their disloyalty, does not constitute knowing participation. In each instance, Providence’s evidence tracked Crossroads closely: the executives acted largely on their own initiative, Truly required new hires to certify they wouldn’t use Providence’s data, and the happy hour took place the evening of the managing employee’s resignation, after her fiduciary duties had ended. No. 25-40194 (May 15, 2026)