Memorandum - is noncompete clause enforceable
Court of Appeals of Ohio, Tenth District, Franklin County. WILLIAMS, Appellant,
v. HOBBS et al., Appellees.
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Radiologist brought action against hospital, group practice corporation of which he was a former member, and doctor with whom he had formerly been in practice seeking money damages and an injunction enjoining defendants from preventing his continued practice of radiology at the defendant hospital. The group practice corporation filed a counterclaim seeking an injunction to prevent radiologist from practicing radiology in county for two years pursuant to covenant not to compete included in his employment contract. The Court of Common Pleas, Franklin County, denied both requests for an injunction and radiologist and group practice corporation appealed. The appeals were consolidated and the Court of Appeals, Cook, J., held that: (1) evidence supported court's finding that covenant restraining radiologist from competing with his former employer was unreasonable, and (2) hospital did not violate its regulations when it terminated the radiology clinical privileges of radiologist because of hospital's exclusive contract with group practice corporation.
Judgments affirmed.
Moyer, J., concurred in part and dissented in part and filed opinion.
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**288 Syllabus by the Court
*331 1. A covenant restraining a physician-employee from competing with his former employer upon termination of employment is unreasonable where it imposes undue hardship on the physician and is injurious to the public, the physician's services are vital to the health, care and treatment of the public, and the demand for his medical expertise is critical to the people in the community.
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COOK, Judge.
Dr. Dale L. Williams, an osteopathic physician specializing in radiology, practiced at Doctors Hospital in Columbus for approximately fifteen years. During that period of time, he was an associate physician and later a member physician of a group radiology practice known as T.C. Hobbs and Associates, Inc. When he was employed by the Hobbs group, Dr. Williams signed an employment contract which contained the following covenant not to compete:
“Employee further agrees that during the term of this Agreement, or within a period of two years following the effective date of the termination of his employment, he will not engage directly or indirectly in the specialty practice of radiology, or any of its branches, in the City of Columbus, or the County of Franklin, unless this provision is waived in writing by the corporation.”
As the result of a dispute between Dr. Williams and other physicians in the group, Dr. Williams was expelled from
the corporation effective December 3, 1981. The corporation also demanded that Doctors Hospital terminate Dr. Williams' privileges at the hospital as to the use of the hospital's radiology equipment and facilities because the corporation and Dr. Hobbs, by contract, had the exclusive right to perform all radiology services at the hospital. The administrator of the hospital notified Dr. Williams that his privileges to utilize hospital radiology facilities would terminate at midnight, December 3, 1981.
On December 30, 1981, the executive committee of the board of trustees of the hospital ratified the administrator's action by renewing Dr. Williams' appointment to the hospital's medical staff, but terminated his radiology privileges. Dr. Williams appealed to the full board of trustees which affirmed the action of its executive committee.
On December 3, 1981, Dr. Williams filed a legal action against Doctors Hospital, Dr. T.C. Hobbs, and T.C. Hobbs and Associates, Inc., seeking money damages and an injunction enjoining defendants from preventing his continued practice of radiology at the hospital. Each of the defendants filed an answer. T.C. Hobbs and Associates, Inc. filed a counterclaim seeking an injunction to prevent Dr. Williams from practicing radiology in Franklin County for two years, pursuant to the covenant not to compete which was included in his employment contract.
The trial court heard the two requests for injunctive relief on the merits, denied both requests, and, as to the judgment denying Dr. Williams' request for injunctive relief, found there was “no just cause for delay.”
T.C. Hobbs and Associates, Inc., appealed the trial court's denial of its requested injunction and this appeal was assigned No. 82AP-571.
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The appeals were consolidated for argument in this court.
All errors assigned in both appeals are without merit.
[1] Turning first to appeal No. 82AP-571, the law as to covenants restricting competition by an employee with his former employers is set forth in Raimonde v. Van Vlerah (1975), 42 Ohio St.2d 21, 325 N.E.2d 544 [71 O.O.2d 12], where the Supreme Court, in paragraph two of the syllabus, held:
“A covenant restraining an employee from competing with his former employer upon termination of employment is reasonable if the restraint is no greater than is required for the protection of the employer, does not impose undue hardship on the employee, and is not injurious to the public.”
In the instant cause, the trial court found:
“The covenant is unreasonable for it is greater than is required for the protection of defendant Hobbs. The covenant imposes an undue hardship on the plaintiff, and also, it is injurious to the public. Plaintiff's services are vital to the health, care and treatment of the public. The demand for his medical expertise is critical to the people in our community. This Court is not attempting to rewrite the contract, but rather to prevent undue hardship to the plaintiff and the public. Defendants' rights are also considered in this Court's findings.”
[2][3] The trial court's finding was supported by the evidence. The transcript of proceedings indicates that there was evidence before the court that Dr. Williams is a skilled radiologist, particularly in his subspecialty of interventional radiology. The evidence also indicates that his particular skill is not common among radiologists in the community.
There is also evidence that the covenant in the employment contract constitutes a hardship to Dr. Williams and the public since Doctors Hospital is one of the few osteopathic institutions in which he can practice his specialty. The evidence also indicates that T.C. Hobbs and Associates, Inc.'s radiology practice is primarily performed at Doctors Hospital.
There was evidence from which the trial court could conclude that the covenant that Dr. Williams was not to practice in Franklin County for two years upon leaving T.C. Hobbs and Associates, Inc. was unreasonable.
In C.E. Morris Co. v. Foley Construction Co. (1978), 54 Ohio St.2d 279, 376 N.E.2d 578 [8 O.O.3d 261], the Ohio Supreme Court held:
“Judgments supported by some competent, credible evidence going to all the essential elements of the case will not be reversed by a reviewing court as being against the manifest weight of the evidence.”
We conclude that the trial court did not err in denying T.C. Hobbs and Associates, Inc.'s request for an injunction.
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Judgments affirmed.
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END OF DOCUMENT