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Justices split on transfer of noncompete case

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Two Indiana Supreme Court justices disagreed with their colleagues in not accepting an appeal, finding that a ruling from the state's intermediate appellate court muddled caselaw on medical business and noncompete agreements, and significantly jeopardizes the public's access to medical care.

In a seven-page dissent authored by Chief Justice Randall T. Shepard and joined by Justice Brent Dickson, the two jurists get into why they would have granted transfer in the case of Mercho-Roushdi-Shoemaker-Dilley Thoraco-Vascular Corp. (MRSD) v. James W. Blatchford, III, M.D., and Eve G. Cieutat, No. 84A01-0801-CV-30.

The Feb. 5, 2009, Court of Appeals decision involves the enforceability of a noncompete agreement between doctors and a physicians' group, and this transfer denial keeps in place that holding that could significantly impact Indiana's medical community.

Originating from Vigo Superior No.1, the case goes back more than a decade and involves a group of open-heart surgeons in Indianapolis and Terre Haute who recruited a husband-wife team from Texas to provide more staff capacity at one location. All parties negotiated agreements covering multiple aspects of their business relationship, from stock purchasing to dissolution procedures and noncompete provisions. When the Texas doctors decided several years later to set up a competing practice of their own in Terre Haute, they and their former associates sued each other.

That first round of litigation went to the Court of Appeals, which in 2001 affirmed a trial judge's denial of injunctive relief for the Indiana-based physicians on grounds that an adequate remedy existed at law. But a second round of litigation ensued, and the Court of Appeals affirmed that ruling and held that the noncompete agreements weren't enforceable. In its decision from earlier this year, the three-judge panel unanimously held that enforcing the physicians' business agreements in this case is harmful to patients and contrary to public policy. Specifically, it affirmed solely based on the public interest prong of noncompetition agreement evaluation.

Deciding on the issue during its weekly conference Dec. 17, three justices agreed with the appellate panel's decision and voted not to accept the case. But Chief Justice Shepard and Justice Dickson disagreed with their colleagues.

The chief justice found issues with how James Blatchford and Eve Cieutat had no Indiana connections yet raised arguments that "people would die without (them) practicing in Terre Haute, that it would be very difficult to recruit doctors with their level of training to the area, and that there would be a shortage of capable doctors if they left." The two doctors have since left the state to practice elsewhere.

The chief justice wrote that the physicians group MRSD, and others in similar situations, likely wouldn't have recruited the Texas doctors or any others from outside Indiana if noncompete agreements weren't an option.

"While it is appropriate to treat employment agreements involving doctors with special care, failure to enforce at law the business agreements among doctors will mean fewer doctors available to patients, not more," he wrote, adding later that the Court of Appeals decision "muddles the caselaw of the medical business."

"This case illustrates why non-enforcement of such agreements has the potential to detract from the public interest. Denying damages to a practice seeking to enforce its business arrangements detracts from the very public interests that this Court's decisions aim to protect - patient access to medical care," Chief Justice Shepard wrote. "I think the patients (and doctors) would be well served by vacating the Court of Appeals' declaration that business arrangements between physicians are not enforceable."

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  1. I will continue to pray that God keeps giving you the strength and courage to keep fighting for what is right and just so you are aware, you are an inspiration to those that are feeling weak and helpless as they are trying to figure out why evil keeps winning. God Bless.....

  2. Some are above the law in Indiana. Some lined up with Lodges have controlled power in the state since the 1920s when the Klan ruled Indiana. Consider the comments at this post and note the international h.q. in Indianapolis. http://www.theindianalawyer.com/human-trafficking-rising-in-indiana/PARAMS/article/42468. Brave journalists need to take this child torturing, above the law and antimarriage cult on just like The Globe courageously took on Cardinal Law. Are there any brave Hoosier journalists?

  3. I am nearing 66 years old..... I have no interest in contacting anyone. All I need to have is a nationality....a REAL Birthday...... the place U was born...... my soul will never be at peace. I have lived my life without identity.... if anyone can help me please contact me.

  4. This is the dissent discussed in the comment below. See comments on that story for an amazing discussion of likely judicial corruption of some kind, the rejection of the rule of law at the very least. http://www.theindianalawyer.com/justices-deny-transfer-to-child-custody-case/PARAMS/article/42774#comment

  5. That means much to me, thank you. My own communion, to which I came in my 30's from a protestant evangelical background, refuses to so affirm me, the Bishop's courtiers all saying, when it matters, that they defer to the state, and trust that the state would not be wrong as to me. (LIttle did I know that is the most common modernist catholic position on the state -- at least when the state acts consistent with the philosophy of the democrat party). I asked my RCC pastor to stand with me before the Examiners after they demanded that I disavow God's law on the record .... he refused, saying the Bishop would not allow it. I filed all of my file in the open in federal court so the Bishop's men could see what had been done ... they refused to look. (But the 7th Cir and federal judge Theresa Springmann gave me the honor of admission after so reading, even though ISC had denied me, rendering me a very rare bird). Such affirmation from a fellow believer as you have done here has been rare for me, and that dearth of solidarity, and the economic pain visited upon my wife and five children, have been the hardest part of the struggle. They did indeed banish me, for life, and so, in substance did the the Diocese, which treated me like a pariah, but thanks to this ezine ... and this is simply amazing to me .... because of this ezine I am not silenced. This ezine allowing us to speak to the corruption that the former chief "justice" left behind, yet embedded in his systems when he retired ... the openness to discuss that corruption (like that revealed in the recent whistleblowing dissent by courageous Justice David and fresh breath of air Chief Justice Rush,) is a great example of the First Amendment at work. I will not be silenced as long as this tree falling in the wood can be heard. The Hoosier Judiciary has deep seated problems, generational corruption, ideological corruption. Many cases demonstrate this. It must be spotlighted. The corrupted system has no hold on me now, none. I have survived their best shots. It is now my time to not be silent. To the Glory of God, and for the good of man's law. (It almost always works that way as to the true law, as I explained the bar examiners -- who refused to follow even their own statutory law and violated core organic law when banishing me for life -- actually revealing themselves to be lawless.)

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