Wausau Medical Center v. Asplund

514 N.W.2d 34, 182 Wis. 2d 274, 1994 Wisc. App. LEXIS 363
CourtCourt of Appeals of Wisconsin
DecidedFebruary 8, 1994
Docket92-3117, 93-0890
StatusPublished
Cited by28 cases

This text of 514 N.W.2d 34 (Wausau Medical Center v. Asplund) is published on Counsel Stack Legal Research, covering Court of Appeals of Wisconsin primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Wausau Medical Center v. Asplund, 514 N.W.2d 34, 182 Wis. 2d 274, 1994 Wisc. App. LEXIS 363 (Wis. Ct. App. 1994).

Opinion

CANE, P.J.

Wausau Medical Center (WMC) appeals four orders that: (1) denied WMC a temporary injunction prohibiting Mark Asplund, M.D., from practicing medicine in Marathon County; (2) granted summary judgment to Asplund and his service corporation, dismissing WMC's counterclaim asserting causes of action against Asplund in contract, promissory estoppel, negligent and intentional misrepresentation, and conspiracy to injure business in violation of § 134.01, STATS.; (3) granted Asplund summary judgment on an amended claim alleging breach of good faith and fair dealing; and (4) granted Asplund costs for items WMC contends are not taxable. Because WMC presents a number of arguments to support this appeal, each argument will be set out within our discussion of that argument. We reject WMC's arguments, and, therefore, affirm.

*279 FACTS

Dr. Asplund was twice employed as a general and vascular surgeon at WMC, a multi-specialty clinic. His first employment was from August 1988 to the end of July 1989. Asplund was WMC's first vascular surgeon, and this was Asplund's first professional practice following his residency. With this employment, Asplund entered into a contract with WMC that contained a restrictive covenant. Asplund voluntarily terminated his employment and moved to Iowa to participate in a transplant program in July 1989. WMC did not have a vascular surgeon between July 1989 and August 1990.

Within a year, Asplund decided that he wanted to return to Wausau. Asplund began negotiations with WMC. The negotiations broke off at one point because Asplund wanted the restrictive covenant stricken from the new contract, and WMC refused to do so. Nevertheless, Asplund commenced a second term of employment in August 1990 after signing an employment contract that contained a restrictive covenant. The covenant, which was identical to the one contained in his first contract, stated:

Covenant Not to Compete. The Employee agrees that if his employment with the Corporation is terminated for any reason he will not engage in the practice of medicine or any phase or specialty thereof in competition with the Employer for a period of two (2) years from the date of termination of his employment within Marathon County, Wisconsin. The Employee hereby consents to an issuance of an injunction by a court of competent jurisdiction to enjoin the violation of the foregoing in addition to any other remedies available to the Corporation. In lieu of said injunction, the Corporation shall have the option to recover as liquidated *280 damages from the Employee a sum equal to twenty percent (20%) of the total cumulative professional charges made by the Employee during the twelvemonth period immediately preceding the termination date.

In September 1990, forty-five days after he started, Asplund gave WMC sixty days' notice of his employment termination. Asplund formed a service corporation, Mark Asplund, S.C., while still employed at WMC. After his employment at WMC was terminated, he began his surgery practice in Wausau as an employee of the service corporation.

Asplund originally commenced this action by seeking to have the restrictive covenant declared unenforceable. 1 Initially, WMC obtained a five-day temporary restraining order but was later denied a temporary injunction following a hearing. WMC filed a counterclaim and a third-party complaint against Asplund and his service corporation. Asplund voluntarily dismissed his claim, making WMC the plaintiff, and he then moved for summary judgment dismissing all WMC's claims against him and the service corporation. The trial court granted summary judgment in favor of Asplund, who sought costs, which were also granted.

THE RESTRICTIVE COVENANT

When reviewing a summary judgment, we apply the same methodology as the trial court. Green Spring Farms v. Kersten, 136 Wis. 2d 304, 314-15, 401 N.W.2d

*281 816, 820 (1987). Whether a particular employment restraint is reasonably necessary has been held to be a question of law that must be resolved with reference to the facts of the particular case. Geocaris v. Surgical Consultants, Ltd., 100 Wis. 2d 387, 388, 302 N.W.2d 76, 77-78 (Ct. App. 1981). Summary judgment is proper when there is no genuine issue of material fact in dispute relative to the reasonableness of the agreement. Rollins Burdick Hunter, Inc. v. Hamilton, 101 Wis. 2d 460, 470, 304 N.W.2d 752, 757 (1981).

The following canons of construction of restrictive covenants have been adopted: (1) These restrictions are prima facie suspect; (2) they must withstand close scrutiny to pass legal muster as being reasonable; (3) they will not be construed to extend beyond their proper import or further than the language of the contract absolutely requires; and (4) they are to be construed in favor of the employee. Streiff v. American Family Mut. Ins. Co., 118 Wis. 2d 602, 610-11, 348 N.W.2d 505, 510 (1984) (citing Zimmermann v. Brennan, 78 Wis. 2d 510, 514-15, 254 N.W.2d 719, 721 (1977); Gary Van Zeeland Talent, Inc. v. Sandas, 84 Wis. 2d 202, 218-19, 267 N.W.2d 242, 250 (1978)). Although WMC correctly points out that restrictive covenants between physicians are not disfavored, this was with regard to a specific set of facts. See Oudenhoven v. Nishioka, 52 Wis. 2d 503, 505, 190 N.W.2d 920, 921 (1971). 2 Oudenhoven does not provide an exception to the gen *282 eral rule that restrictive covenants are prima facie suspect. However, it illustrates how a covenant's necessity is determined according to each particular set of facts. See Geocaris, 100 Wis. 2d at 388, 302 N.W.2d at 77-78.

Under § 103.465, STATS., 3 a covenant not to compete within a specific time and a specific territory is lawful "only if the restrictions imposed are reasonably necessary for the protection of the employer." Five inquiries are made in evaluating the enforceability of a covenant not to compete. The covenant must: (1) be necessary for the protection of the employer; (2) provide a reasonable time restriction; (3) provide a reasonable territorial limit; (4) be reasonable as to the employee; and (5) be reasonable as to the general public. Chuck Wagon Catering, Inc. v. Raduege, 88 Wis. 2d 740, 751, 277 N.W.2d 787, 792 (1979).

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Bluebook (online)
514 N.W.2d 34, 182 Wis. 2d 274, 1994 Wisc. App. LEXIS 363, Counsel Stack Legal Research, https://law.counselstack.com/opinion/wausau-medical-center-v-asplund-wisctapp-1994.