Significant new requirements for physician noncompete agreements in Indiana took effect on July 1, 2020, including mandatory language allowing a physician to purchase “a complete and final release” from a noncompete agreement “at a reasonable price.” The law also includes several provisions related to notices that employers must provide to patients and doctors when a physician’s employment has terminated or contract expires.
On December 18, 2019, in American Consulting, Inc. d/b/a American Structurepoint, Inc. v. Hannum Wagle & Cline Engineering, Inc., et al., the Indiana Supreme Court provided clarity about when liquidated damages become unenforceable penalties.
The spread of the coronavirus disease 2019 (COVID-19) has led to changes regarding many legal issues. Despite the changes, companies still need to protect confidential information, goodwill, customer relationships, and competitive marketplace positions. The pandemic raises a variety of issues to consider for restrictive covenants. Employers may want to keep these challenges in mind and tread carefully.
On December 3, 2019, in Heraeus Medical, LLC v. Zimmer, Inc., the Indiana Supreme Court reaffirmed the “blue pencil doctrine,” likening the doctrine to an eraser and stating that Indiana courts may only delete language from overbroad restrictive covenants; they cannot reform or add to such agreements.
On April 15, 2019, the Indiana Court of Appeals issued a ruling that significantly developed restrictive covenant law in two areas: whether courts may reform contracts (as opposed to blue-penciling them) and whether non-solicitation provisions can include prospective customers.
The Indiana Court of Appeals recently issued a restrictive covenant ruling addressing several significant issues.