Non-compete agreements: When veterinary associates and practice owners clash - DVM
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Non-compete agreements: When veterinary associates and practice owners clash
Conflict can erupt when expectations fail, veterinarians report


Protecting good will

Sprinkle is well versed in the intricacies of non-competition covenants. His company buys veterinary hospitals nationwide. "We have to put in non-competes that protect our investment and are fair," he says.

After all, the greatest part of any such purchase is good will. Good will is often derived from the owner, who has built a practice over many years. But, Sprinkle acknowledges, "the larger the practice, the less the good will resides with any one individual."

That service reputation is something owners try to protect when hiring new associates. Plus, owners want to retain those clients built from that good will. Sprinkle does acknowledge, however, that some clients may want to follow an associate who leaves a practice.

"The client always has the right to see whomever they wish or to go to whomever they wish," he says. Plus, he adds, "I would hope that an associate veterinarian worth anything, working in a hospital for more than two years, would have some sort of following by a certain number of people."

When it comes to separation, Sprinkle says that the most important key to preventing conflict is communication, and keeping it out of court is his number one goal. "We have had experiences with non-competes that have been tested by the courts, and I never want it to happen again," he says. And though both instances came out in his company's favor, Sprinkle says that it was, "a long and onerous process where nobody wins except the attorneys. It's a waste of energy and a waste of time. I'd rather have dialogue and prevent these things from happening."

Unfortunately for Cichra, the only path to resolution lay in the courts. In retrospect, she says, she shouldn't have signed the contract that included the non-compete, but she wanted to buy the business.

Cichra hired a lawyer, and — $8,000 later — was released from her non-compete.

Moving on

Cichra says she will never sign another non-compete. And, for now, the prospect isn't looming. Cichra owns her own business, a mobile veterinary unit, and says she couldn't be happier.

And to those facing signing a non-compete, she offers some advice: "Remember what you're worth, and don't just sign something because you need a job. You need to hire a lawyer to read it over and understand the implications of it."


Source: DVM360 MAGAZINE,
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