## Facts

- Four employees of an insurance-brokerage firm signed employment agreements containing two-year post-termination noncompetition covenants.
- The original employer underwent a series of statutory mergers, with Acordia of Ohio, L.L.C. as the surviving entity.
- The noncompete agreements did not expressly state they were enforceable by “successors or assigns.”
- After the mergers, the employees left to work for a competing insurance agency.
- Acordia sued the employees to enforce the noncompetition covenants; the employees contended the covenants were not enforceable by Acordia after the merger.

## Issues

1. Whether, after a statutory merger, the surviving company may enforce employees’ noncompetition agreements as the original employer could, even absent express “successors or assigns” language.
2. Whether Ohio’s merger statute, R.C. 1701.82(A)(3), transfers noncompetition agreements to the surviving entity by operation of law as corporate “assets” or contract rights.
3. Whether the court’s analysis was limited to noncompetition agreements rather than contracts generally.

## Decision

- On reconsideration, the Supreme Court of Ohio reversed the appellate court’s judgment and remanded.
- The court held that, under R.C. 1701.82(A)(3), noncompetition agreements transfer by operation of law to the surviving company in a statutory merger.
- The surviving company may enforce the noncompetition agreements as if it were the original contracting employer, without needing additional contract language naming successors.
- The case was remanded for the trial court to decide whether the specific noncompetition covenants were reasonable and enforceable under Ohio law.

## Legal Principles

- In a statutory merger, all assets and property of each constituent entity—including employment contracts and agreements—transfer to the surviving entity by operation of law under R.C. 1701.82(A)(3).
- Employee noncompetition agreements are transferable contract rights within the statute’s scope and may be enforced by the surviving entity with the same enforcement rights held by the predecessor.
- A merger-based transfer by operation of law is distinct from an assignment or novation and does not require separate employee consent.
- The successor’s ability to enforce does not eliminate ordinary limits on noncompetes; enforceability still depends on reasonableness (e.g., duration, geographic scope, and restrictions) and equitable application.
- The holding is limited to noncompetition agreements in the merger context.

## Conclusion

The Ohio Supreme Court held that a surviving entity in a statutory merger may enforce inherited employee noncompetition covenants as the predecessor could because the agreements transfer automatically by operation of law, and it remanded for a traditional reasonableness analysis of the specific covenants.


Acordia of Ohio, L.L.C. v. Fishel, 978 N.E.2d 823 (Ohio 2012)