April R. Walkup obtained summary judgment for Vanguard Health Systems in a lawsuit brought by AR Imaging, a former exclusive radiology service provider, alleging breach of a provision of the Radiology Services Agreement which restrained Vanguard Health Systems from directly or indirectly hiring or affiliating with any entity that hired any radiologists who had provided professional radiology services through AR Imaging during the term of its three-year Agreement with Vanguard Health Systems. The lawsuit, filed in the Circuit Court of Cook County, also alleged that Vanguard Health Systems tortiously interfered with the contractual relationship AR Imaging had with two radiologists, resulting in those radiologists breaching the restrictive covenants contained in their respective employment agreements with AR Imaging. AR Imaging further alleged that Weiss Memorial Hospital unjustifiably induced these radiologists to breach their contracts by allowing them to remain on staff at its hospital after the expiration of the Agreement with AR Imaging.
Vanguard Health Systems argued, and the court agreed, that the restraint contained in the Radiology Services Agreement was unenforceable as a matter of law because its effect was to prohibit a third party radiology services provider from hiring those radiologists that had provided services through AR Imaging. The court found that this was an unlawful restraint on trade and entered judgment in favor of Vanguard Health Systems.
The court also agreed with Vanguard Health System's argument that it did not tortiously interfere with AR Imaging's contractual relationships with two former radiologists because the restrictive covenants in those radiologists' employment agreements were unenforceable as a matter of law because they were not designed to protect a near permanent relationship AR Imaging had with Vanguard Health Systems, or any patients. In addition, the court found that the Hospital did not actively induce the two radiologists to breach their restrictive covenants. Finally, the court held that AR Imaging could not establish that it suffered any damages as a result of the radiologists' conduct. As such, the court entered judgment in Vanguard Health Systems' favor.
If you have any questions or would like more information regarding this matter, please contact April Walkup directly at awalkup@querrey.com or 312.540.7506.
