Valley Medical Specialists v. Farber

982 P.2d 1277 (1999)

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Nature of the Case

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Facts

Valley Medical hired Farber who treated AIDS and HIV positive patients and performed other procedures. A few years after joining, Farber became a shareholder, officer, and director. In 1991, the three directors entered into new stock and employment agreements. The employment agreement had a restrictive covenant. In 1994, Farber left and began practicing within the confines of the restrictive covenant. Valley Medical (P) sued Farber (D). The trial court denied a request for a preliminary injunction in that the covenant violated public policy or was unenforceable because it was too broad. The court found that any covenant over six months was unreasonable because it covered 235 square miles and the restriction was unreasonable because it did not provide an exception for emergency medical aid and was not limited to pulmonology. The appeals court reversed and noted that there were eight hospitals outside the restricted area where D could practice. The court also held that the severability clause permitted the trial court to modify the restrictions to exclude emergency services. P had also stipulated that D could perform brachyterapy and treat AIDS and HIV patients within the restricted area even though the covenant contained no such provision. The three-year time was also found to be reasonable because it might take a replacement that length of time to develop a pulmonary practice. This appeal resulted.