Acordia of Ohio, L.L.C. v. Fishel

Summary

The Supreme Court of Ohio held that noncompete agreements transferred to a surviving company by operation of law after a merger, but remained enforceable only according to their original terms. Because the agreements applied only to the specific original employers and contained no successor or assign language, the employees’ noncompete periods expired when those employers ceased to exist through mergers. The court affirmed summary judgment for the employees.

Holdings

1. Noncompete agreements transfer to the surviving company by operation of law under Ohio's merger statute.
2. Although the noncompete agreements transferred to the surviving company, the surviving company could enforce them only according to their original terms and could not enforce them as though the merger had changed the named employer to include the surviving company.
3. The employees' noncompete periods expired when the specifically named original employers ceased to exist through merger, and all periods had expired before the employees left the L.L.C.; therefore, Acordia had no legal right to enforce the agreements.

Questions Presented

1. Whether noncompete agreements transfer by operation of law to the surviving company in a statutory merger.
2. Whether the surviving company may enforce the transferred noncompete agreements as though it had stepped into the shoes of the original contracting employer.
3. Whether the employees' two-year noncompete periods had expired when they left the surviving company.

Disposition

affirmed