As we have
previously blogged about, in 2016 the Nevada Supreme Court refused to adopt the “blue pencil” doctrine and held that Nevada courts could not modify over-broad restrictive covenants. The following year, we alerted readers that the Nevada legislature amended Nevada Revised Statute 613, governing non-competition agreements. Among other things, the amendment granted courts the authority to “blue-pencil” non-competition agreements, overturning the Nevada Supreme Court’s 2016 decision in
Golden Road Motor Inn, Inc. v. Islam.
Now, the Nevada Supreme Court chimed in again on the “blue pencil” doctrine. In
Duong v. Fielden Hanson Isaacs Miyada Robison Yeh, Ltd., two doctors signed noncompetition agreements in 2016 in exchange for continued employment subsequent to a merger. The agreements prohibited the doctors from working at certain facilities upon termination of their employment relationship. The agreements notably contained an express blue-penciling provision stating that if any provision were found to be unreasonable by a court, “any such portion shall nevertheless be enforceable to the extent such court shall deem reasonable, and, in such event, it is the parties’ intention . . . and request that the court reform such portion in order to make it enforceable.”