I. Facts: Plaintiff Dr. Kapinski opened a second office in Ithaca because his clients find it difficult to travel to his original office in Auburn. He hired Dr. Ingrasci, a Buffalo General Hospital trainee on oral surgery, as his assistant. They signed a contract stating that Dr. Ingrasci was to live in Ithaca and that Dr. Ingrasci “will never practice dentistry and/or Oral Surgery in Cayuga, Cortland, Seneca, Tompkins or Ontario counties except: in association with Dr. Karpinski or if Dr. Karpinski terminates the agreement and employs another oral surgeon.” Also, the defendant was to execute a $40,000 promissory note in case he practices in the five enumerated counties. In 1968, Dr. Ingrasci left his employer and opened another clinic in Ithaca. This led to the closure of Dr. Karpinski’s Ithaca clinic.
II. Contentions of the Parties: Plaintiff avers that there was a breach of the restrictive covenant and prays not only injunction but an award of $40,000 as well. The Supreme Court, Cayuga County granted the injunction and award of damages. The defendant appealed the decision where the Appellate Division reversed the judgment and held that the restrictive covenant was “impermissibly broad”
III. Issue: The issue is whether the restrictive covenant is impermissibly broad.
IV. Decision: The Court of Appeals averred that the plaintiff has a rightful interest in protecting the practice of surgery, which he has built through the years. The Court held that the restrictive covenant was within the limits of permissibility thus, granting the injunction but for oral surgery alone. As the plaintiff only practices oral surgery. The Court also awarded the plaintiff with the actual damages he suffered in the course defendant practiced oral surgery within the five counties. The case was remanded to Supreme Court, Cayuga County for further proceeding in accordance with the CA opinion.
V. Legal Reasoning/Rule of Law: The Court’s decision was based on an established doctrine that a professional, who had been an assistant to another, may bind himself not to engage in the same practice after his term of employment within a reasonable territorial extent. The Court viewed that the territories stipulated in the restrictive covenant are within permissible limits.