Raimonde v. Van Vlerah - 42 Ohio St. 2d 21, 325 N.E.2d 544 (1975)

Rule:

A covenant restraining an employee from competing with his former employer upon termination of employment is reasonable if it is no greater than is required for the protection of the employer, does not impose undue hardship on the employee, and is not injurious to the public. Courts are empowered to modify or amend employment agreements to achieve such results. 

Facts:

Appellant, James T. Raimonde, and appellee, Donald Van Vlerah, are doctors of veterinary medicine in a small town. Van Vlerah was hired by Raimonde, and signed a covenant not to compete within 30 miles of Raimonde for three years from the date of termination of employment. Van Vlerah later terminated his employment but opened his own practice less than 30 miles from Raimonde. Raimonde sued on the covenant, but it was dismissed as an unreasonable restraint of trade.

Issue:

Was the dismissal of the complaint for a violation of a covenant not to compete, on the ground that the contract was an unreasonable restraint of trade, proper?

Answer:

No.

Conclusion:

The court reversed and held that it was abandoning the "blue pencil" test in favor of a rule of reasonableness. The court also reversed the finding that Raimonde could only have been granted the relief prayed for in his complaint, which was for three years from the date of termination of the contract. According to Ohio R. Civ. P. § 54(C), the facts determined the relief granted in each case. The court remanded for a reconsideration of the contract under the new rule and appropriate injunctive relief, if warranted.