In the case of Carothers v. Shumaker, Loop & Kendrick, L.L.P., 2023-Ohio-1907, an appellate court held that (1) an arbitrator may enforce an attorney noncompete agreement in relation to retirement and (2) an arbitrator may modify an attorney noncompete agreement in respect to the geographic and timing restrictions when the issue is brought to the arbitrator and the agreement does not limit the remedies the arbitrator may utilize.
In this case, the former employee argued that (1) the arbitrator incorrectly decided to enforce the noncompete agreement because Ohio public policy prohibits noncompete agreements for attorneys and (2) the former employee submitted the entirety of the noncompete issue to the arbitrator to decide. The law firm argued that (1) Ohio is not required to follow an advisory opinion by the American Bar Association (“ABA”) when Ohio law permits noncompete agreement associated with the retirement from law and (2) the former employer did not specifically mention the scope of the geographic or timing restriction in the noncompete agreement nor did the former employee ask for these restrictions to be modified by the arbitrator. The appellate court agreed with the law firm on the noncompete issue and with the former employer on the geographic and timing restrictions modification issue.
In support of its decision in favor of the law firm on the noncompete issue, the appellate court explained that the arbitrator took into consideration all applicable laws, including the ABA advisory opinion, and concluded that the noncompete agreement relating to retirement did not violate Ohio public policy.
In support of its decision in favor of the former employee on the geographic and timing restrictions modification issue, the appellate court explained that the former employee specifically requested that the arbitrator resolve the dispute on whether the time and scope restrictions were unreasonable, unenforceable, and not narrowly tailored. The appellate court further explained that the arbitration clause did not contain a restriction on the arbitrator’s authority to resolve the claim, and therefore the arbitrator could modify the geographic and timing restrictions.
To read this case, click here.
Authors: Matthew John Markling and the McGown & Markling Team.
Note: This blog entry does not constitute – nor does it contain – legal advice. Legal jurisprudence is like the always-changing Midwestern weather. As a result, this single blog entry cannot substitute for consultation with a McGown & Markling attorney. If legal advice is needed with respect to a specific factual situation, please feel free to contact a McGown & Markling attorney.