Joliet Medical Group, Inc. v. Ensminger

Case Date: 04/04/2003
Court: 3rd District Appellate
Docket No: 3-02-0141 Rel

No. 3-02-0141


IN THE

APPELLATE COURT OF ILLINOIS

THIRD DISTRICT

A.D., 2003

JOLIET MEDICAL GROUP, INC.,

          Plaintiff-Appellant,

                    v.

SCOTT A. ENSMINGER, D.O.,

          Defendant-Appellee.

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Appeal from the Circuit Court
of the 12th Judicial Circuit
Will County, Illinois


No. 01-CH-070

Honorable Herman Haase,
Judge, Presiding


JUSTICE LYTTON delivered the opinion of the court:


 

Plaintiff, Joliet Medical Group (Joliet Medical), anddefendant, Dr. Scott A. Ensminger, entered into an employment andnon-competition agreement in 1998. The non-competition agreementprohibited Ensminger from operating a medical practice within a twomile radius of Joliet Medical's principal offices for a period ofthree years. In 2000, Ensminger resigned from Joliet Medical andopened two offices outside the geographic limitation. However, hemaintained staff privileges at Provena-St. Joseph Medical Center(St. Joseph), a hospital located within the restricted radius. Joliet Medical brought an action for a preliminary injunction toenforce the non-competition agreement. Both parties filed motionsfor summary judgment. The trial court granted Ensminger's motion,finding that his actions at St. Joseph did not constitute a medicalpractice as contemplated by the non-competition agreement. Weagree and affirm.

FACTS

Joliet Medical is a professional corporation that employsphysicians to treat patients in the Joliet area. In 1998, JolietMedical negotiated an employment agreement with Ensminger thatcontained a non-competition agreement. The agreement not tocompete prevented Ensminger from operating a medical practicewithin two miles of Joliet Medical's principal office for a periodof three years after leaving Joliet Medical.

"This Agreement shall prevent Doctor directly orindirectly, on his behalf or as an employee, officer,agent, director, partner, consultant or advisor, duringthe period of their Agreement (i) from forming, owning,joining, controlling or seeking, applying for ...develop[ing] or operat[ing] a medical practice within theGeographic Area, or (ii) from otherwise participating inthe ownership of or being otherwise affiliated with anyperson or entity engaged in the type of businessprohibited by this Agreement in the Geographic Area"(emphasis added).

As part of his employment, Ensminger maintained staff privileges atSt. Joseph.

In 2000, Ensminger resigned from his position with JolietMedical and signed a letter acknowledging the binding effect of thenon-competition agreement. After his resignation, Ensmingeropened offices in Lemont and Shorewood, outside the two milelimitation contained in the agreement. Ensminger modified hisinformation on file at St. Joseph to reflect his employment change. He maintained his privileges at the hospital and began to admitpatients there. St. Joseph is the only hospital that services theShorewood area, but it is located within two miles of JolietMedical.

Joliet Medical filed a complaint for injunctive relief, askingthe court to enjoin Ensminger from "practicing medicine orotherwise ... violating the Agreement." The parties filed crossmotions for summary judgment. The trial court granted Ensminger'smotion. The court held that prohibiting Ensminger from admittingpatients to St. Joseph unreasonably prevented him from operating amedical practice in Shorewood and unfairly extended the scope ofthe agreement.

ANALYSIS

Summary judgment is properly granted if the pleadings,depositions, and admissions on file, together with any affidavits,show there is no genuine issue as to any material fact and that themoving party is entitled to judgment as a matter of law. Largosav. Ford Motor Co., 303 Ill. App. 3d 751, 753 (1999).

Joliet Medical argues that St. Joseph qualifies as a "medicalpractice"; it claims that by treating and admitting patients to St.Joseph, Ensminger established a medical practice within the twomile restricted area. Ensminger admits that he practices medicineby treating and admitting patients to St. Joseph, but denies thatthe hospital is a medical practice.

The practice of medicine occurs whenever doctors perform anactivity for which they must be licensed according to the MedicalPractice Act of 1987, including writing prescriptions, treatingdiseases or diagnosing patients. 225 ILCS 60/3 (West 1998).

In contrast, a "medical practice," simply stated, is thephysician's business. It includes physical assets and goodwillthat can be liquidated, such as offices, patient files, furniture,medical equipment, instruments, professional books, fixtures, andbuildings. See generally Lieberman and Kraff, M.D., S.C. v.Desnik, 244 Ill. App. 3d 341, 342 (1993) (where medical practiceincluded patient cards and records, office furnishings, equipmentand other assets). It is a distinct entity, the business of whichis to medically treat patients.

Certainly doctors practice medicine at a hospital. However,the physical location at which a doctor practices medicine does not automatically qualify it as a medical practice. Physicians may have a medical practice at an office; when they treat patients ata hospital, they are practicing medicine, but their medicalpractice has not moved from the office to the hospital. A hospitalis merely a necessary tool of the practice. Similarly, if physicians made house calls to visit patients, they would bepracticing medicine at patients' homes, but their medical practicedoes not thereafter include the patients' homes.

Here, Ensminger's medical practice is located at his officesin Lemont and Shorewood, and he has staff privileges to treat hispatients at St. Joseph. The hospital is merely an element of hispractice, a place where he can practice medicine.

The non-competition agreement prohibited Ensminger fromestablishing a medical practice, not from practicing medicine. Itmay not have been unreasonable to prohibit Ensminger frompracticing medicine (see Carter-Shields, M.D. v. Alton HealthInstitute, 201 Ill. 2d 441 (2002)), but that is not what theagreement says.

Joliet Medical cites Berlin v. Sarah Bush Lincoln HealthCenter, 179 Ill. 2d 1 (1997), in support of its position thattreating patients in a hospital constitutes treatment in a medicalpractice. In Berlin, the issue was whether an employment agreementexecuted between a doctor and a hospital violated the prohibitionon the corporate practice of medicine. Our supreme court held thata duly licensed hospital possesses the authority to practicemedicine by employing licensed physicians. Berlin, 179 Ill. 2d at19. The court did not hold that a hospital constituted a medicalpractice.

Joliet Medical also cites Cockerill v. Wilson, 51 Ill. 2d 179(1974), where two veterinarians executed a non-competitionagreement when they formed an association to practice veterinarymedicine. The court found that the agreement not to competeprevented the defendant from practicing veterinary medicine. Cockerill, 51 Ill. 2d at 184-85. As we have stated, languageprohibiting the practice of medicine does not appear in theagreement executed by Joliet Medical and Ensminger. We findCockerill inapposite.

Since we have determined that the hospital is not a medicalpractice and that Ensminger is not in violation of the agreement,we need not reach other issues asserted by Joliet Medical.

The judgment of the circuit court of Will County is affirmed.

Affirmed.

JUSTICE SLATER, dissenting:


 

The majority finds that admitting patients to St. Joseph'shospital and treating them there is "practicing medicine" but thedefendant is not engaging in a "medical practice" in doing so. Even if one accepts the majority's restrictive definition of amedical practice as encompassing only the physical assets "such asoffices, patient files, furniture, medical equipment, instruments,professional books, fixtures, and buildings" (slip op. at 4), Ifail to see how the hospital escapes this definition. After all,the hospital certainly has all of the physical assets referred toby the majority, in abundance. Indeed, in explaining how a"medical practice" differs from "practicing medicine," the majoritystates that the former is "a distinct entity, the business of whichis to medically treat patients." Slip op. at 4. This definitionprecisely describes a hospital. See Berlin, 179 Ill. 2d at 17, 688N.E.2d at 113 (hospitals are authorized, even mandated, by statuteto provide medical services). Nevertheless, the majority curiouslyconcludes that "the hospital is not a medical practice". Slip op.at 6.

I would find, at a minimum, that St. Joseph's hospital isengaging in a "medical practice." Under the non-competitionagreement the defendant is prohibited not only from engaging in amedical practice but also from "being otherwise affiliated with anyperson or entity engaged in the type of business prohibited by thisAgreement in the Geographic Area." In my view, any reasonableinterpretation of this provision bars the defendant frommaintaining staff privileges at the hospital.

Accordingly, I would reverse the entry of summary judgment infavor of the defendant and enter summary judgment in favor of theplaintiff.