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Community Hospital Group12/29/2003
NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION
Argued December 2, 2003
Plaintiff The Community Hospital Group, t/a JFK Medical Center, seeks to enforce a post-employment restrictive covenant with defendant neurosurgeon Jay More, a former employee of plaintiff's New Jersey Neuroscience Institute. The covenant as written states that defendant is prohibited from practicing within a thirty-mile radius of plaintiff's location in Edison for a period of two years. Plaintiff claims that after his resignation from plaintiff's employ in July 2002 defendant violated the covenant by joining another neurosurgery practice located several miles from plaintiff.
Plaintiff applied to the Chancery Division to preliminarily enjoin defendant from engaging in the new practice, relief which that court denied in an order dated November 21, 2002. We denied plaintiff's motion for leave to appeal on January 8, 2003, but the Supreme Court granted plaintiff's motion for leave to appeal in a March 25, 2003 order that summarily remanded the matter to us"to consider the appeal on its merits." Having done so, we grant the preliminary injunction on the terms stated below.
Before the preliminary injunction hearing the parties took considerable discovery. The following facts, on which we rely in this appeal, are essentially undisputed.
I.
Plaintiff JFK Medical Center is a not-for-profit hospital in Edison. The New Jersey Neuroscience Institute is part of the Hospital and is a not-for-profit medical care provider specializing in the treatment of neurological disorders. The Institute's mission goals are clinical care, education, and research in the areas of neurology and neurosurgery. It deems itself a"tertiary care provider" of neurology-related services, receiving the majority of its patients through referrals from physicians in other specialties.
Since its inception in 1992, the Institute has sought to develop an extensive clinical neurological program and has devoted approximately fourteen million dollars to its development. It also invests approximately two hundred thousand dollars annually on advertising and promotion. It offers a stroke treatment program, as well as epilepsy and neuro-oncology programs, and is the only New Jersey medical facility to provide "Gamma Knife" treatment, a non-surgical technique used to treat certain brain tumors and vascular malformations.
In 1996, the Institute established an accredited neurological residency program, an activity that can be distinguished from a neurosurgery program. It claims that its continued viability is dependent upon its ability to recruit and retain a sufficient number of skilled physicians that will enable it to generate the necessary volume of patients to support its services, such as the residency program. It claims that without a sufficient number of physicians on staff, it would be unable to attract the case diversity necessary to provide training for the residency program and, therefore, might lose its accreditation.
On July 1, 1994, plaintiff hired defendant as a neurosurgeon immediately upon the completion of his residency at Mt. Sinai Hospital in New York. Defendant did not bring with him to this position any practice or patient base. In December 1994, the parties entered into a written one-year employment contract whose term ran until June 30, 1995. The parties entered into successor employment agreements effective July 1, 1995, for four years and July 1, 1999, for a term of five years.
Each of the three employment agreements contained post employment restrictive covenants which prohibited defendant from certain medical practic
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