* * * Moreover, an interpretation which renders the covenant fair and reasonable in its application to the circumstances of the given case will be preferred to one which results in its complete nullification.'
In the present motion, however, plaintiff contends that if paragraph 7 of the employment agreement is not void and unenforceable upon its face, the factual background against which the counterclaimant seeks enforcement of the covenant discloses that the covenant is broader than is reasonably necessary for the protection of the defendant, imposes an undue and oppressive hardship upon the plaintiff, and constitutes such a restraint of trade as to be repugnant to the public interest and policy. On a motion for summary judgment, as has been noted above, this Court is not permitted to do any fact-finding, but must merely determine whether any genuine material issue of fact exists. A perusal of the plaintiff's contentions under point 2 of his brief not only fails to disclose the absence, but indeed manifests the presence of several genuine issues of fact, in the light of which the reasonableness of the restrictive covenant must be determined. The specific references made by the plaintiff to factual items which happen to be admitted by the plaintiff and by defendant's president respectively, fail to prove the absence of ultimate factual issues which must be resolved after a consideration of all of the evidence to be presented and by the drawing of inferences from specific items of proof. The following genuine issues of material fact are manifest upon the present motion:
(1) Does plaintiff control Metalead?
(2) Has Metalead threatened to produce and sell metallic soap paint dryers?
(3) Would such production and sale by Metalead constitute a breach of plaintiff's covenant?
(4) Would enforcement of his covenant work an undue hardship upon plaintiff?
(5) Will breach of the covenant cause irreparable injury to defendant?
(6) Is the scope of plaintiff's covenant reasonably necessary for defendant's protection?
Because, therefore, the reasonableness of the covenant is an ultimate question of fact to be determined after consideration of all of the evidence bearing upon the question, a summary judgment determining that the particular covenant is or is not reasonable is precluded at this point in the litigation by the language of Rule 56 (F.R.Civ.P.).
Plaintiff's next attack upon the counterclaim is to be found in his contention that the covenant contained in paragraph 7 of the employment agreement is indivisible and, therefore, may not be partially enforced. My determination that the covenant is not void on its face renders immaterial the question of its divisibility. Enforcement of the covenant within territory in which plaintiff or Metalead would be in competition with defendant would not be making a new contract for the parties nor reducing any space limitation prescribed or implicit in the contract. If the agreement to refrain from participation in competition is not per se invalid, then the competitive area must be shown by the evidence. When the competitive area is thus shown, the reasonableness of the restrictive covenant may be determined. See Award Incentives, Inc. v. Van Rooyen, supra. While a bargain is in restraint of trade when its performance would limit competition in any business, or restrict a promissor in the exercise of a gainful occupation, such a bargain is illegal only if the restraint is unreasonable. Such a restraint of trade is unreasonable if it is greater than is required for the protection of the person for whose benefit the restraint is imposed, or imposes undue hardship upon the person restricted, or is based on a promise to refrain from competition not ancillary to a contract of employment. An agreement by an employee not to compete with his employer during the term of the employment or thereafter within such territory and during such time as may be reasonably necessary for the protection of the employer without imposing undue hardship on the employee does not impose an unreasonable restraint of trade. Restatement, Contracts §§ 513-516. Whether paragraph 7 of the employment agreement in this case possesses any of the foregoing saving characteristics depends upon what the evidence upon a plenary trial of the case will disclose. It may not be held void on its face. Under the law of New York, as I find it to be, the language of the covenant does not, of itself, spell out an illegal restraint of trade. Per contra, it is well within those limits recognized as appropriate, subject to factual circumstances which only the proofs will disclose. Plaintiff appears to argue that it is only unfair competition which equity will restrain by injunction. Whether such competition, if any, threatened (if at all) by the plaintiff through Metalead is unfair or otherwise, can be ascertained only after the evidence has been presented. In any event, in the language of the covenant there appears nothing unreasonable or unfair either in the obligation which the plaintiff understandingly and voluntarily assumed in entering into it, nor in the election of the former employer to attempt to hold the former employee to the terms of his covenant. See Award Incentives, Inc. v. Van Rooyen, supra, 263 F.2d at page 177.
I therefore conclude that plaintiff's motion for summary judgment upon defendant's amended counterclaim must be denied. The contention of defendant-counterclaimant that it should have summary judgment upon the amended counterclaim, despite defendant's failure to cross-move therefor, is without support in the authority which it cites. Summary judgment for defendant will not be granted upon the present record. The enforceability of the covenant is determinable only upon evidence yet to be disclosed upon the question of the reasonableness of its terms.
An order may be presented in accordance with the views hereinabove expressed.