Florida Hematology Specialists v. Tummala

• Decision Date: 01 November 2007
• Docket Number: No. SC06-993.,SC06-993.
• Citation: 969 So.2d 316
• Parties: FLORIDA HEMATOLOGY & ONCOLOGY SPECIALISTS, etc., et al., Petitioners, v. Rambabu TUMMALA, M.D., et al., Respondents.
• Court: Florida Supreme Court

969 So.2d 316

FLORIDA HEMATOLOGY & ONCOLOGY SPECIALISTS, etc., et al., Petitioners, v. Rambabu TUMMALA, M.D., et al., Respondents.

No. SC06-993.

Supreme Court of Florida.

November 1, 2007.

Application for Review of the Decision of the District Court of Appeal — Direct Conflict Fifth District — Case No. 5D05-1950 (Lake County).

H. Gregory McNeill of Lowndes, Drosdick, Doster, Kantor, and Reed, P.A., Orlando, FL, and Thomas M. Ervin, Jr. of Ervin, Kitchen, Chapman, and Ervin, Tallahassee, FL, for Petitioners.

Christopher V. Carlyle, Shannon McLin Carlyle, and Gilbert S. Goshorn, Jr. of the Carlyle Appellate Law Firm, the Villages, FL, for Respondents.

PER CURIAM.

We originally accepted jurisdiction to review Florida Hematology & Oncology v. Tummala, 927 So.2d 135 (Fla. 5th DCA 2006), pursuant to article V, section 3(b)(3) of the Florida Constitution. See Fla. Hematology & Oncology Specialists v. Tummala, 937 So.2d 122 (Fla.2006) (granting review). However, after hearing oral argument, we have determined that jurisdiction was improvidently granted. Accordingly, we hereby discharge jurisdiction and dismiss this review proceeding.

It is so ordered.

WELLS, ANSTEAD, PARIENTE, QUINCE, CANTERO, and BELL, JJ., concur.

LEWIS, C.J., dissents with an opinion.

LEWIS, C.J., dissenting.

After accepting jurisdiction and conducting oral argument, we have now simply dismissed this case. I dissent from the majority's decision to dismiss the instant case because I believe jurisdiction was not improvidently granted. We should resolve the express and direct conflict which clearly exists between the decisions in Florida Hematology & Oncology v. Tummala, 927 So.2d 135 (Fla. 5th DCA 2006), and Southernmost Foot & Ankle Specialists, P.A. v. Torregrosa, 891 So.2d 591 (Fla. 3d DCA 2004). We should exercise our discretion to resolve the conflict to fulfill our constitutional responsibilities to maintain uniformity in Florida law, rather than leaving this split which will continue to cause impact until resolved.

To understand the irreconcilable conflict here, it is necessary to analyze the decisions involved in the issues in the instant case. The present legal issue and controversy is centered upon whether referring physicians are a "legitimate business interest," pursuant to section 542.335 of the Florida Statutes, in the hematology and oncology context. Under section 542.335, a restrictive covenant is enforceable only if it protects a "legitimate business interest." See § 542.335(1)(b), Fla. Stat. (2004). Here, Dr. Tummala entered into a restrictive covenant at the start of his employment with Florida Hematology & Oncology Specialists, P.A., Lake County Oncology & Hematology, P.A., and Roy M. Ambinder, M.D. (collectively "the Corporation"). See Tummala, 927 So.2d at 137. The restrictive covenant prohibited Tummala from practicing medicine within a fifteen-mile radius of any office of the Corporation for a period of two years after termination of his employment. See id. After Tummala terminated his employment and contrary to the restrictive covenant, he immediately opened an office within fifteen miles of an office of the Corporation, and received client referrals from physicians with whom he had previously developed a relationship while working for the Corporation. See id. The Corporation has asserted a significant drop in new patients previously referred by these other physicians. See id.

The Corporation attempted to enforce the restrictive covenant, and Tummala has asserted that the covenant is unenforceable as a matter of law under section 542.335. See id. On appeal, the Fifth District held that referring physicians are not a statutory "legitimate business interest." Tummala, 927 So.2d at 139. The Fifth District reasoned that referring physicians supply a "stream of unidentified prospective patients," and a conclusion that referring physicians are a "statutory `legitimate business interest' would completely circumvent the clear statutory directive that `prospective patients' are not to be recognized as such." Id. Moreover, and most importantly, the Fifth District recognized a conflict in making the following specific observation: "We recognize that this holding ... appear[s] to conflict with [Torregrosa]," in which a different district court upheld a determination that referral physicians were within the category of "legitimate business interests." Tummala, 927 So.2d at 139 n. 4 (emphasis added).

In Torregrosa, Dr. Torregrosa entered into an employment contract, which contained restrictive covenants, with Southernmost Foot & Ankle Specialists, P.A. ("Southernmost"). See 891 So.2d at 592. After Torregrosa's employment with Southernmost ended, Southernmost attempted to enforce the restrictive covenant provisions, while Torregrosa argued that the "restrictive covenants were void because they did not protect a legitimate business interest." Id. at 593. On appeal, the Third District concluded:

The trial court properly found ... that the restrictive covenant was reasonably necessary to protect Southernmost's legitimate business interests in its patient base, referral doctors, specific prospective and existing patients, and patient goodwill.

Id. at 594 (emphasis added). This conclusion was not dicta. Rather, it was included within and an essential element in the Third District's holding, which was that various aspects of the restrictive covenants (i.e., duration, geographic breadth, etc.) should not be modified. See id. at 594-95. As described above, a restrictive covenant is enforceable only if it protects a "legitimate business interest" pursuant to section 542.335. Thus, the Third District affirmed that the trial court had properly found that referral doctors are a "legitimate business interest" before it could ever reach the issue of whether the restrictive covenants should be modified.

With this unquestionable express and direct conflict, this Court should have exercised its discretion and accepted review here.¹ I believe jurisdiction should have been accepted here as the instant case is precisely the kind of conflict this Court should be deciding to maintain uniformity in Florida law. There is no way to harmonize Tummala and Torregrosa. The two decisions are irreconcilable, which the Fifth District specifically acknowledged in Tummala. Moreover, a uniform interpretation of section 542.335 is critical not only to medical doctors but to those in all walks of life, because this legislation applies to all types of restrictive covenants. On a daily basis, economic futures are placed at risk through the use of such covenants and reliance upon such covenants. It is clear to me that referral professionals are "legitimate business interests" subject to protection in the geographic jurisdiction of Dade and Monroe counties. However, those in the geographic jurisdiction of the Fifth District...