Contributed by Scott R. Leah, Esq., 412.594.5551

In a recent case, several physicians challenged the ability of a medical practice to restrict their ability to practice medicine in accordance with a noncompetition agreement that they had signed. The physicians argued that the agreements were void as they violated state law on restricting the ability of physicians to practice medicine.

The Montana Supreme Court noted that the Montana law in question was not violated so long as the noncompetition agreement places only a reasonable restriction on the rights of a physician to practice medicine.

In that case, the noncompete did not absolutely bar the physicians from practicing medicine in the geographic area, but rather reduced the amount of their partnership interest that they would receive upon departure if they chose to practice medicine in that geographic area.

The Supreme Court reversed the trial court’s granting of summary judgment to the departing physicians, holding that the trial court should have allowed for a factual determination as to whether that restriction was "reasonable."