Page 28 - Bulletin Vol 28 No 2 - May - Aug. 2023 FINAL

Legal Article | New Laws About Non-Competes

Understanding How to Protect Your Practice (Potentially) Without Non Competes

By: Jennifer Kirschenbaum, Esq.

Congratulations! You have successfully obtained a dental license, found a location, plumbed it, equipped
it, staffed it and filled it with patients. Perhaps enough patients that by now you employ other dentists,
who have not taken the time, energy or capital to open their own office. A question on many minds given

recent news around potential non-competition legislative restrictions is - how do I protect what I have
built from competition? The answer is not as simple as one contractual provision embodied by a
“non-compete”. Over the years, the law has evolved to create contractual protections that are enforcea-
ble in court, which subject violators to monetary and other damages for trying to take what is identified as
employer proprietary information or for competing within a radius and during a time restriction deemed
reasonable. It is important to note that noncompetition language is not our only protection from
competition or theft of proprietary information, and, perhaps, non-competition contractual language is
not even our most useful protection in prohibiting employees or independent contractors from disrupting

our practices. There are many other restrictions supported by case law we can use to protect against
patient or brand attrition/diminution, including, but not limited to, non-solicitation contractual language,
which will contractually restrict the employee from contacting patients, referral sources or vendors of the
practice, to divert them in any manner, confidentiality provisions, which can protect proprietary
information of the practice, and, work product restrictions, which can protect the ideas created by an
individual associated with your practice or non-disparagement provisions, protecting against negative
publicity. None of which are directly under attack, and, each of these are important tools for an employer
to properly deploy in their contracts, to protect against what you have built.

Specifically, as related to non-competition provisions, non-competition provisions are prolific in dentistry
in New York in employment agreements and independent contractor agreements regularly utilized this
restrictive provision to protect against even a 1099 that works one day a week or one day every other
week from potentially poaching or competing in a geographic area that’s near their office More than any
other specialty in healthcare non-competes are excepted by employees and utilized by employers. Which
is why many of you may have been very irked to see that in June the New York state legislature like a few
similarly minded other states passed in the assembly a bill that would ban all noncompetition agreements
indicating that Governor Hochul is in support of this measure, leading employers, to wonder what
protections will remain if this legislation passes. Similarly, we see employer protections being challenged
by the federal government*. Many of a small business owners are wondering why the attack on their

livelihoods and ability to maintain our proprietary businesses. There’s good news and bad news here in
the evolution of a protective provision, like a non-compete. The good news is to date no change has been
made in New York. One potential positive to glean if changes are made, we can anticipate a more liquid
labor market as an employer, with the ability to hire more freely without concern of a potential lawsuit for
hiring an individual that is currently under a non-compete. If you have not run into this issue before, it is

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