business

As the U.S. workforce has become more mobile and the code that once bound employees to employers for entire careers has been shredded, businesses increasingly use noncompete agreements to keep key employees from straying, whether they are IT professionals, sales vice presidents or professional entertainers.

David Bradley Olsen of Henson & Efron has represented them all, including Brock Lesnar, the professional wrestler and ultimate fighting contender.

QIn layman's language, what is a noncompete agreement?

AA contract usually entered into between an employer and employee, or seller of a business, that prohibits the employee from certain activities, such as selling competing products or working for a competing company.

QAre they negotiable?

AIt depends upon your bargaining power and whether you are a ''star'' employee.

QLet's talk about a star in the world of wrestling and ultimate fighting, Brock Lesnar, your client, and his breakup a few years back with World Wrestling Entertainment (WWE).

ABrock was a Big 10 champion wrestler at the University of Minnesota and wanted to become a pro, and the biggest show was the WWE. We got him into WWE and he worked there for a few years and decided, because of the lifestyle, working 300-plus days, never time to heal injuries ... he asked for a release. The company said "sure."

The release included a noncompetiton agreement that said for six years not only could he not work for a competing wrestling company but that he couldn't work anywhere in the world in any capacity in sports entertainment.

QWhat happened?

AWe concluded it was not enforceable for a number of reasons: length of time and the worldwide restriction. And it was ambiguous as to "sports entertainment." We went to federal court and asked for a declaratory judgement. WWE sued Brock for claimed breach of the agreement because he had sat in the audience at a wrestling match in Japan and he was introduced to the audience. After a year we reached an agreement. He had the right to go work for Ultimate Fighting Championship, where he works now, and any other fighting company.

QWhat are the lessons for the rest of us from the Lesnar case?

AThe general rule in Minnesota is that noncompete agreements are enforceable, but only to the extent that they are reasonable and tailored to protect an employer's legitimate business interests. Had the WWE drawn the agreement to try and protect its real interests, performing wrestling shows, and limited the agreement to six months or a year, we would have had a much tougher time challenging the agreement. The lesson to Minnesota employers is to make the agreement specific and drawn to you and your employee's specific interests. Once you overreach, that opens the door to litigation.

QThese agreements are becoming more common?

AWe have a pretty mobile workforce. There's no stigma anymore to moving from job to job, as there used to be. There's a highly trained workforce with a lot of technical training and proprietary and confidential information, and they are moving from one company to another. It's all in their heads. If they move to a competitor and use it, that's a potential threat. It's one thing to leave the computer and documents at an old employer. Absent a noncompete agreement, there's nothing to prevent a former employee from using what he knows [for a different company].

QIf I'm a prospective employee, do I have to reveal that I have a noncompete with my previous employer? 

AAbsolutely: If you lie about it, that's grounds for termination.

QHow much leverage do employees have in these deals?

AIn general, a "star" employee can negotiate some pay during the period you have to sit out. ... sometimes, most to all of salary during the year or two that you have to sit out. In the case of a CEO, a two- or three-year restriction may be upheld.

QYou've represented former Gov. Jesse Ventura from his days in professional wrestling to the governor's office, right?

ASince 1992. It's been a wild ride with Governor Ventura. He started out suing Vince McMahon of the WWE. Since then, we've done TV, books. He argued recently that the TSA violated his Fourth Amendment rights to be free from unreasonable searches and seizures. The case was dismissed in U.S. District Court in St. Paul for lack of jurisdiction. We have 35 or 40 days to appeal to the U.S. Court of Appeals. The governor hasn't decided if he's going to appeal.

Neal St. Anthony • 612-673-7144 • nstanthony@startribune.com