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contractmotionsummary judgmentmotion for summary judgment
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O’Sullivan v. Sunil Gupta, M.D., LLC, Not Reported in Fed. Supp., 2017 WL 3438349

Facts

Sean O'Sullivan, an ophthalmologist, was employed by the Retina Specialty Institute (RSI), owned by Sunil Gupta, M.D., LLC. Upon joining RSI, O'Sullivan signed a Noncompetition and Nonsolicitation Agreement that restricted his ability to compete against RSI after leaving the company. O'Sullivan later challenged the legality of certain provisions in the agreement, arguing they violated Louisiana law.

O'Sullivan works at RSI’s two locations in Louisiana, one in Metairie and the other in Covington.

Issue

The main legal issue is whether specific provisions of the Noncompetition and Nonsolicitation Agreement signed by O'Sullivan are enforceable under Louisiana law, particularly La. R.S. § 23:921.

O'Sullivan argues that certain portions of the RSI Agreement—namely, paragraphs 5 through 8, as well as paragraphs 11 and 13—violate Louisiana law, and are therefore null and void.

Rule

Under La. R.S. § 23:921, any contract that restrains a person from exercising a lawful profession, trade, or business is null and void unless it meets specific requirements regarding geographic scope and duration.

Under La. R.S. § 23:921 , the general rule is that '[e]very contract or agreement, or provision thereof, by which anyone is restrained from exercising a lawful profession, trade, or business of any kind … shall be null and void.'

Analysis

The court analyzed the provisions of the RSI Agreement in light of Louisiana law, determining that several clauses constituted covenants not to compete and failed to meet the geographic and time requirements set forth in La. R.S. § 23:921. The court emphasized that the geographic limitation defined in miles was insufficient and that the absence of a specified parish or municipality rendered the provisions unenforceable. Additionally, the court found that the provisions aimed at protecting confidential information also functioned as noncompetition agreements, thus subjecting them to the same legal scrutiny.

The Court concludes that subsection (d) falls within the scope of § 23:921 . Subsection (d) explicitly targets O'Sullivan’s ability to 'accept or engage in [ ] business or activity.'

Conclusion

The court granted O'Sullivan's motion for summary judgment, declaring the challenged provisions of the RSI Agreement null and void and severing them from the agreement.

IT IS ORDERED that the motion is GRANTED as set forth herein. Paragraph 5, subsections (a), (b), (c), and (d); paragraph 8, subsections (a)(1) and (b); and paragraph 13 of the RSI Agreement are hereby declared NULL AND VOID, and are severed from the RSI Agreement.

Who won?

Sean O'Sullivan prevailed in the case because the court found that the provisions of the Noncompetition and Nonsolicitation Agreement violated Louisiana law and were unenforceable.

Sean O'Sullivan prevailed in the case because the court found that the provisions of the Noncompetition and Nonsolicitation Agreement violated Louisiana law and were unenforceable.

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