The legal, ethical, and practical implications of noncompetition clauses: What physicians should know before they sign

Journal of Law, Medicine and Ethics

Volumn 31, Issue 2, 2003, Pages 283-291

  Loeser, Derek W ^a,b,c  

^a Keller Rohrback LLP   (United States)

^b UNIVERSITY OF WASHINGTON   (United States)

^c MIDDLEBURY COLLEGE   (United States)

Author keywords

[No Author keywords available]

Indexed keywords

CONFERENCE PAPER; ECONOMIC ASPECT; GEOGRAPHIC DISTRIBUTION; HEALTH MAINTENANCE ORGANIZATION; HUMAN; MEDICAL ETHICS; MEDICAL PRACTICE; MEDICOLEGAL ASPECT; PHYSICIAN ATTITUDE; STANDARD; TIME; CONTRACT; EMPLOYMENT; ETHICS; HEALTH CARE AND PUBLIC HEALTH; LEGAL APPROACH; LEGAL ASPECT; MEDICAL SOCIETY; PHYSICIAN; PROFESSIONAL PRACTICE; REVIEW; UNITED STATES;

HEALTH CARE AND PUBLIC HEALTH; LEGAL APPROACH;

AMERICAN MEDICAL ASSOCIATION; CONTRACTS; ECONOMIC COMPETITION; EMPLOYMENT; ETHICS, MEDICAL; HUMANS; PHYSICIANS; PROFESSIONAL AUTONOMY; UNITED STATES;

EID: 0642371804     PISSN: 10731105     EISSN: None     Source Type: Journal    
DOI: 10.1111/j.1748-720X.2003.tb00089.x     Document Type: Conference Paper

References (57)

1. Lotenfoe v. Pahk, 747 So. 2d 422, 425 (Fla. Dist. Ct. App. 1999).
2. Merrill Lynch, Pierce, Fenner & Smith Inc. v. Chung, 2001 WL 283083, at *4 (C.D. Cal. 2001) (citing MAI Systems Corp. v. Peak Computer, Inc., 991 F.2d 511, 521 (9th Cir. 1993)).
3. See, e.g., Pahk, 747 So. 2d at 424.
4. M. Handler and D.E. Lazaroff, "Restraint of Trade and the Restatement (Second) of Contracts," New York University Law Review, 57 (1982): 669-766, at 721 (citing Carpenter, "Validity of Contracts Not to Compete," University of Pennsylvania Law Review, 76 (1928): 244-58, at 244-45).
5. M. Handler and D.E. Lazaroff, "Restraint of Trade and the Restatement (Second) of Contracts," New York University Law Review, 57 (1982): 669-766, at 721 (citing Carpenter, "Validity of Contracts Not to Compete," University of Pennsylvania Law Review, 76 (1928): 244-58, at 244-45).
6. Handler and Lazaroff, supra note 4, at 721-22.
7. Id. at 723.
8. Id. at 724.
9. Mitchel v. Reynolds, 1 P. Wms. 181, 191, 24 Eng. Rep. 347, 350 (Q.B. 1711).
10. However, several states, including California, Montana, North Dakota, and Oklahoma, have enacted statutes declaring noncompetition agreements void. See Cal. Bus. & Prof. Code § 16600 (West 1987); Mont. Code Ann. § 28-2-703 (1995); N.D. Cent. Code § 9-08-06 (1987); Okla. Stat. Ann. tit. 15, § 217 (West 1993).
11. JAK Productions, Inc. v. Wiza, 986 F.2d 1080, 1085 (7th Cir.1993).
12. Knight, Vale and Gregory v. McDaniel, 680 P.2d 448, 452 (Wash. Ct. App. 1984).
13. Ibid. Id.
14. Ibid. Id.
15. Ibid. Id.
16. See, e.g., Sigma Chemical Co. v. Harris, 586 F. Supp. 704, 710 (E.D. Mo. 1984) (former employee was a chemical buyer for a company that sold esoteric chemicals used in hospitals, universities, and laboratories worldwide).
17. Wiza, 986 F.2d at 1087.
18. Ibid. Id.
19. Bridgestone/Firestone, Inc. v. Lockhart, 5 F. Supp. 2d 667, 683 (S.D. Ind. 1998).
20. Valley Medical Specialists v. Farber, 982 P.2d 1277, 1286 (Ariz. 1999) (quoting H.M. Blake, "Employee Agreements Not to Compete," Harvard Law Review, 73 (1960): 625-91, at 682-83).
21. Ibid. Id.
22. See, e.g., Wood v. May, 438 P.2d 587, 592 (Wash. 1968).
23. Ikon Office Solutions, Inc. v. Dale, 170 F. Supp. 2d 892, 895-96 (D. Minn. 2001), aff'd, 22 Fed. Appx. 647, 2001 WL 1269994 (8th Cir. 2001).
24. Ibid. Id.
25. Model Rules of Prof'l Conduct R. 5.6 (1990). Most jurisdictions base their codes of legal ethics on the Model Rules, or its predecessor, the Model Code of Professional Responsibility.
26. Model Rules of Prof'l Conduct R. 5.6 cmt. (1990).
27. Dwyer v. Jung, 336 A.2d 498, 500 (N.J. Super Ct. Ch. Div. 1975).
28. Ibid. Id.
29. Code of Medical Ethics, Council on Ethical and judicial Affairs Op. E-9.06 (issued prior to April 1977).
30. Council on Ethical and Judicial Affairs Op. E-10.01 (1993).
31. Council on Ethical and Judicial Affairs Report 1-A-01 (June 2001), available at 〈http://www.ama-assn.org/ama/upload/mm/369/report_116. pdf〉. The quoted language was adopted as AMA. Ethics Policy at the 2001 Annual Meeting of the AMA House of Delegates.
32. A.S. Di Dio, "The Legal Implication of Noncompetition Agreements in Physician Contracts," Journal of Legal Medicine. 30 (1999): 457-77, at 475-76.
33. Id. at 457.
34. Council on Ethical and Judicial Affairs Op. E-9.02 (June 1998).
35. Arthur Murray Dance Studios of Cleveland v. Witter, 105 N.E.2d 685, 703-04 (Ohio Com. Pl 1952).
36. See supra note 9.
37. Colo. Rev. Stat. Ann. § 8-2-113(3) (West 1986); Del. Code. Ann. tit. 6, § 2707 (1993); Mass. Gen. Laws Ann. ch 112, § 12X (West 1991). See X. Johnson, "Noncompetition Clauses in Physician Employment Contracts in Oregon," Oregon Law Review, 76 (1997): 195-206, at 200.
38. Karlin v. Weinberg, 390 A.2d 1161, 1169 (N.J. 1978).
39. See Di Dio, supra note 31, at 473.
40. Karlin, 390 A.2d at 1166.
41. Pittman v. Harbin Clinic Professional Ass'n, 437 S.E.2d 619, 622-23 (Ga. Ct. App. 1993).
42. Fields Foundation, Ltd. v. Christensen, 309 N.W.2d 125, 133 (Wis. Ct. App. 1981).
43. Canfield v. Spear, 254 N.E.2d 433 (Ill. 1969).
44. Farber, 982 P.2d 1277.
45. Id. at 1279-80.
46. Id. at 1286.
47. Id. at 1283.
48. Id. at 1282.
49. Id. at 1283. See Ohio Urology, Inc. v. Poll, 594 N.E.2d 1027, 1032 (Ohio Ct. App. 1991) (finding that physician noncompetition agreements "should be strictly construed in favor of professional mobility and access to medical care and facilities").
50. Farber, 982 P.2d at 1286.
51. Ibid. Id.
52. Id. at 1285; Carter-Shields v. Alton Health Institute, 739 N.E.2d 569, 577 (Ill. App. Ct. 2000) (invalidating noncompetition clause on the ground that "it would deprive at least some patients of an ongoing relationship with the physician of their choice, and thus, is contrary to public policy").
53. Farber, 982 P.2d at 1285.
54. Statesville Medical Group, P.A. v. Dickey, 418 S.E.2d 256, 260 (N.C. Ct. App. 1992).
55. Ibid. Id.
56. Ellis v. McDaniel, 596 P.2d 222, 224-25 (Nev. 1979).
57. Karlin, 390 A.2d at 1169.