Virginia Campbell County Breached Covenant Not-compete Lawyers Attorneys
VIRGINIA CASE FOR NON COMPETE
FACTS:
A corporation filed its amended motion for judgment against a doctor, alleging that the doctor, the corporation’s former employee, breached a covenant not to compete. After the Circuit Court of Campbell County (Virginia) denied the doctor’s motion to dismiss, and following a bench trial, a judgment was entered in favor of the corporation. The doctor appealed. He asserted that the former corporation cannot “engage in the practice of medicine” in Virginia because it does not have a license to practice medicine in this Commonwealth. As a consequence, he contends that the former corporation does not have a legitimate business interest in enforcing the covenant not to compete.
ISSUES:
The issue here is whether the corporation, which is not a professional corporation, has a legitimate business interest in enforcing a covenant not to compete with its former employee, a licensed physician.
DISCUSSION:
When the parties executed the employment agreement, the corporation was a professional corporation, and its sole director and shareholder was a physician. The employment agreement contained a non compete provision. Later, the corporation converted from a professional corporation to a non-professional corporation by operation of law upon the physician’s death. The doctor asserted that the corporation was not permitted to “engage in the practice of medicine” in Virginia because it did not have a license to practice medicine in Virginia. A covenant not to compete between an employer and an employee will be enforced if the covenant is narrowly written to protect the employer’s legitimate business interest, is not unduly burdensome on the employee’s ability to earn a living, and does not violate public policy. Restrictive covenants are disfavored restraints on trade and, therefore, the employer bears the burden of proof and any ambiguities in the contract will be construed in favor of the employee. Each non-competition agreement must be evaluated on its own merits, balancing the provisions of the contract with the circumstances of the businesses and employees involved. The Court first considered whether the Family Care Center, a non-professional corporation, may lawfully engage in the practice of medicine in Virginia, as set forth in the employment agreement. A non-professional corporation cannot engage in the practice of medicine in Virginia. It is unlawful for a corporation to practice a profession or occupation without holding a valid license as required by statute or regulation. Specific terms of the employment agreement states, in part, that Family Care Center “is presently engaged in the practice of medicine.” Family Care Center could not and cannot do so because it does not have a license to practice medicine from the Board of Medicine as required by Code §§ 54.1-2902 and -2929. Therefore, the Court held that the Family Care Center, which cannot practice medicine, cannot engage in a competing practice of medicine with Dr. Parikh, who is a physician licensed to practice medicine in this Commonwealth. Since the Family Care Center cannot lawfully engage in the practice of medicine, it has no legitimate business interest in enforcing the covenant not to compete with Dr. Parikh.
JUDGMENT:
The judgment was reversed and final judgment was entered in favor of the doctor.
Disclaimer:
These summaries are provided by the SRIS Law Group. They represent the firm’s unofficial views of the Justices’ opinions. The original opinions should be consulted for their authoritative content
Maryland Retail Transaction Consumer Protection Lawyers Attorney
MARYLAND CASE FOR COMMERCIAL LITIGATION
Facts:
The two-count complaint in this case, a putative class action, was filed on February 4, 2009, by plaintiff, Alicia Gomez (“Gomez”), against defendant Jackson Hewitt, Incorporated (“Jackson Hewitt”). The complaint alleged a violation of the Credit Services Business Act (“CSBA” or the “Act”) and a violation of the Consumer Protection Act (“CPA”) arising out of Jackson Hewitt’s arrangement of Refund Anticipation Loans (“RALs”) on behalf of Gomez and other Maryland customers of its tax preparation services. Defendant filed a motion to dismiss the complaint for failure to state a claim. When defendant moved to dismiss, no motion for class certification had been filed
Issue:
Whether the defendant’s motion to dismiss the complaint for failure to state a claim should be granted?
Discussion:
This court held that while Md. R. 2-231(c) directed it to determine, as soon as practicable, whether the case could be maintained as a class action, if, as defendant alleged, there was no viable cause of action, then the court could rule on the motion to dismiss before determining whether a class should be certified. The complaint arose out of a refund anticipation loan (RAL) that defendant allegedly arranged for plaintiff. However, plaintiff paid a third party, not defendant, to obtain the RAL. Her claim that she “indirectly” paid defendant to arrange the RAL was insufficient to bring the transaction within the ambit of the CSBA. Moreover the CSBA was not intended to cover the extension of credit by a third-party, who is not privy to the primary transaction which was ancillary to the customer’s purchase of the goods or services provided by the merchant. The CSBA only applied to credit repair transactions, not to ordinary retail transactions like the provision of tax preparation services. Because relief under the CPA claim was dependent upon a cognizable claim under the CSBA, the CPA claim failed as well. The plaintiff in this case neither had a contract with Jackson Hewitt in return for credit services nor a contract for the extension of credit. The documents appended to her complaint make it clear that her contract in this regard was with the third party and that the fee she paid for the extension of credit was paid by her to third party only. The only fee plaintiff was obligated to pay to Jackson Hewitt was the $ 284.00 she agreed to pay for the preparation of her income tax returns.
Judgment:
This court hence dismissed both the counts for failure to state a claim.
Disclaimer:
These summaries are provided by the SRIS Law Group. They represent the firm’s unofficial views of the Justices’ opinions. The original opinions should be consulted for their authoritative content
Virginia Commercial Lease Expiry Landlord Arbitrary Lawyers Attorney
VIRGINIA CASE FOR COMMERCIAL LITIGATION
Facts:
The parties entered into a lease agreement for a 20-year period. There was some discrepancy as to when the lease term ended. The lease provided that the tenant had the right to sublet the leased premises to any subsidiary of the tenant. In consolidated cases, plaintiff landlord brought an action against defendant tenant for unlawful detainer. The landlord claimed that the tenant breached a sublease provision of a primary lease and that the primary lease had expired. The tenant claimed that the primary lease term had not expired and that the landlord acted unreasonably and arbitrarily in denying the sublease and that the landlord’s motive was to extract rent concessions.
Issue:
Whether the primary lease term had not expired and that the landlord acted unreasonably and arbitrarily in denying the sublease?
Discussion:
This court held that the Tenant bears the burden of establishing that the Landlord’s action was arbitrary and unreasonable. Because this is a commercial lease, the Landlord’s actions are governed by principles of fair dealing and commercial reasonableness. This court held that the lease term had not expired, but found for the landlord in the second detainer action. After finding that the lease term had not expired, this court looked to whether the landlord acted unreasonably in bringing a second unlawful detainer action based on the lease provision that the tenant had to sublet to a subsidiary. The tenant had notice of the landlord’s position that the intended sublease was a breach of the primary lease and had allowed the tenant 30 days to either rescind the sublease or clarify that the sublessee was a subsidiary. The tenant failed to take appropriate action to correct the breach. The landlord’s refusal to allow the sublease was not unreasonable or arbitrary. Having concluded that tenant rightfully possessed the leasehold and that the Landlord acted reasonably this court determines that the Landlord’s correspondence was in accordance with Provision 1.10 of the Primary Lease. It afforded tenant sufficient notice of the breach and allowed him thirty days to correct its position either by rescinding the sublease or by clarifying that the sublessee, was an affiliate of the tenant in which case the Landlord’s consent would not be required. (Primary Lease Provision 1.10. The Landlord is entitled to proceed on the second unlawful detainer action, because tenant failed to take appropriate action to correct the breach within thirty days.
Judgment:
This court entered judgment for the tenant in the first unlawful detainer action and entered for the landlord in the second unlawful detainer action.
Disclaimer:
These summaries are provided by the SRIS Law Group. They represent the firm’s unofficial views of the Justices’ opinions. The original opinions should be consulted for their authoritative content
Non Compete Agreement Virginia Maryland Lawyers Attorneys
Non-Compete Law in Virginia and Maryland
Non-compete agreements are often contained in an employment agreement or independent contractor agreement, but may also be executed as a separate document. Non-compete agreements are intended to ensure that during the term of employment or for a period thereafter, an employee or former employee will not directly compete with his or her employer. The non-compete agreement often contains provisions intended to prevent former employees from using proprietary information obtained during the employment relationship to appropriate their former employer’s customers at the expense of their former employer. Most non-compete agreements specify a period during which the former employee is expected to refrain from engaging in activities that will place him or her in direct competition with a former employer. Not all provisions contained in non-compete agreements are lawful – the validity of each provision is determined by state law.
Many employment or business relationships require that one of the parties agree not to compete with the other in a certain territory or for a certain time. The courts of law will sometimes uphold such agreements, and sometimes not. Advice from a qualified Virginia or Maryland non compete attorney is essential in this area. If you require assistance with a covenant not to compete or a non-compete agreement, either in negotiating or drafting such an agreement or in litigating such a dispute in Virginia or Maryland, the non compete attorneys of the SRIS Law Group, P.C. will bring their understanding of competition law to bear in aggressively assisting you with your case.
FACTS:
A corporation filed its amended motion for judgment against a doctor, alleging that the doctor, the corporation’s former employee, breached a covenant not to compete. After the Circuit Court of Campbell County (Virginia) denied the doctor’s motion to dismiss, and following a bench trial, a judgment was entered in favor of the corporation. The doctor appealed. He asserted that the former corporation cannot “engage in the practice of medicine” in Virginia because it does not have a license to practice medicine in this Commonwealth. As a consequence, he contends that the former corporation does not have a legitimate business interest in enforcing the covenant not to compete.
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FACTS:
The former employee went to work for a competitor. Sometime during his employment with the employer, the employer presented a confidentiality and covenant not to compete agreement, which prohibited the former employee from working for a competing business within a 75-mile radius of the employer’s principal place of business for one year after leaving, subject to a liquidated damages provision of $ 50,000 in the event of a breach. The employer paid $ 50 to the former employee for signing the agreement. After a bench trial, the trial court awarded the employer nominal damages of one dollar, rejecting the employer’s argument that it was entitled to liquidated damages pursuant to the terms of agreement. Appellant employer challenged the judgment of the Circuit Court for Montgomery County (Maryland) in favor of appellee, a former employee. The employer had filed a breach of contract action against the former employee, seeking to recover liquidated damages based upon the terms of an employment contract.
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