Covenant not to compete as a condition of fellowship

[Obnoxious Dad]

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I just ran across a glaucoma fellowship that required incoming fellows to sign a covenant not to compete as a condition of obtaining the fellowship. Is this a common occurrence? Here's the link:
http://medicine.utah.edu/ophthalmology/education/fellowship/glaucoma.php

Do you think that these covenants could be applied to medicare funded fellowships?

 

[gutonc]

It's very common in ophtho sub-specialties in particular.

 

[Law2Doc]

Whether it's enforceable will depend on Utahs views of these agreements and whether the restriction is limited enough in scope. Especially whether the counties specified are reasonable in terms of geography. If those counties combined span more than, say, 25 square miles, it's probably not even enforceable. They can't box you out of a big chunk of the state, they can just limit your ability to take their training to the competitor down the block.

 

[DoctwoB]

Whether it's enforceable will depend on Utahs views of these agreements and whether the restriction is limited enough in scope. Especially whether the counties specified are reasonable in terms of geography. If those counties combined span more than, say, 25 square miles, it's probably not even enforceable. They can't box you out of a big chunk of the state, they can just limit your ability to take their training to the competitor down the block.

If the contract included an essentially nonenforcable non-compete does that usually get thrown out or do lines just get redrawn on a more reasonable scale?

 

[Law2Doc]

If the contract included an essentially nonenforcable non-compete does that usually get thrown out or do lines just get redrawn on a more reasonable scale?

Depends on the state, and what the contract provides -- most noncompete agreements have a "savings" clause that saves the provision to the extent the law provides. Some states won't enforce noncompetes at all as a Matter of public policy though, so knowing what the state law is matters.

 

[gutonc]

I completely defer to L2D's interpretation of the law(s) as written and appreciate his insight. But the stark reality of non-competes in medicine is that, in a particular market, everyone knows who has one in their particular specialty, and just won't touch those people with a 10 foot stethoscope. There is a work-around in these settings...if a group really wants to hire you and you have a non-compete, they'll hire you as locums which some non-competes (including mine) don't count, until your non-compete expires.

I've been monitoring the local ecology of my subspecialty for the last 6 or 7 years and can count on 2 fingers the number of people (out of 60 or so of us) who have left one group to join another...and both had non-competes. 1 went the locums route for 2 years, the other moved into administration rather than clinical work, so technically it's 1/60 or so.

 

[IlDestriero]

There's a big difference between thinking, possibly correctly, that the non compete clause is excessive and not enforceable, and being the guy that actually breaks it and gets fired/suspended by their new job while they spend a year or more in protracted litigation to hash it out. It's easier to just move, or provide services that are not prohibited. For example I had one that was just limited to peds anesthesia. I could have taken a job across the street doing adults for a year.

 

[Law2Doc]

There's a big difference between thinking, possibly correctly, that the non compete clause is excessive and not enforceable, and being the guy that actually breaks it and gets fired/suspended by their new job while they spend a year or more in protracted litigation to hash it out. It's easier to just move, or provide services that are not prohibited. For example I had one that was just limited to peds anesthesia. I could have taken a job across the street doing adults for a year.

Fair enough. But just bear in mind that a lot of times lawyers put things like this into contacts assuming no judge is likely to enforce it, on the mere chance that most doctors wouldn't know that and would take exactly the "not worth the hassle" approach you are describing. That's almost as good as it actually being legally enforceable. Sort of like scaring off a prospective robber with a "Beware of Dog" sign even though you don't even have one.