It's about the beer
Gina Miller and Bill Keeper
I know we're both excited that Toppling Goliath from Iowa is now available in our area. They
make great beer but they recently had a dust up with a former brewer that gives them, in my
opinion, a small dark cloud. It's not what you think. It has nothing to do with any cease and
desist order are seemingly the most common legal action among breweries. No this is a more
uncommon form of litigation over worries about the loss of “proprietary recipes, formulas and
techniques,” TG got an injunction against former brewer Chris Flenker saying he signed non-
compete clause, with them and broke it by going into business with his brother, Travis, less
than 150 miles from TG's Decorah HQ. As for why Mr. Fleker singed in the first place he would
have been fired if he didn't. I guess he might have been able to bring a wrongful termination
lawsuit if that happened but I've been told those are not easy to win.
Now before you state quoting me laws Bill, let me say I fully understand that Toppling Goliath is
within its legal right as a business to enforce the contractual agreement, but the ethics related
to such a move feel a bit off for craft beer, which I've always seen as a congenial and
supportive segment of the brewing world.
As best as I understand the situation the reason Toppling Goliath has non-competes in the
first place is due to a problem with prior brewers. Considering they asked brewers to put in 60-
70 hours a week on a $22,000/year salary with no overtime or benefits I can see why some
brewers were unhappy enough to leave and form their own competing brewery. That's exactly
what they did less than a five-mile drive from Toppling Goliath..That brought on the non-
compete clause which stated a leaving or fired brewer would not be allowed to work ifor several
years within 150 miles of TG. Years? 150 miles? Are they kidding?
That brings us back to Mr. .Flenker who clearly wasn’t creating copycat recipes that mimicked
Toppling Goliath beers. He’s 100 miles away and working at a brewery making a fraction of the
production volume, yet TG has gone after him. In essence they are trying to deny him the
chance to make a living for himself and his family. To me, that's not right.
And a lot of the breweries in Iowa agree with me. For example Eric Sorensen, head brewer at
Glenwood, Iowa’s Keg Creek Brewing Co., said his brewery is among others participating in a
planned fundraiser to help offset legal fees for Thew and Chris Flenker. That's the craft
brewing community I know.
That's it from me, chug-a-lug, Bill.....see you next time!
Hello Gina -
I do admit to loving Toppling Goliath's IPAs, pale ales and barrel-aged stouts. In fact Ratebeer
named them the second best brewery in the world. So we're not talking about some unknown
place making bad beer.
As I understand it, Flenker, in connection with his job, had access to nearly all of the Toppling’s
confidential and proprietary information, including recipes, formulas, processes and techniques..
In fact one version of the story says that Flenker told Clark Lewey, Toppling’s owner, that he
intended to open a brewery with his brother using the knowledge he gained working for Lewey
and would beat him in the marketplace. If true, and that's a big if, then I can understand TG's
concern. So it is possible that Flenker who signed the non-compete agreement could have
“acted maliciously and wantonly" as the lawsuit alleges..
Having said that, from what I understand, non-competes are almost never binding when taken to
court, though it depends on what "consideration" he/she was given in return for signing the non-
compete as well as how "reasonable" the court deems it. I've always thought that the main
reason for non-competes, even when they aren't enforceable, is as a scare tactic, either to ward
off other companies or to scare the employee into compliance with the fear of legal fees and
the court system. I guess I should add that neither my source nor I are lawyers. And we're
proud of it.
Let's be honest Gina, noncompete agreements let the employer control its former employees’
actions long after they leave the company, which doesn’t fit well with our country’s honored
traditions of free enterprise and the right to make a living. That’s why some states don’t allow
noncompete agreements at all. Even states that recognize these agreements won’t enforce a
noncompete that lasts too long, covers too much territory, or otherwise places too many limits
on an employee’s right to move on to greener pastures without leaving his or her chosen
Like you Gina, I understand companies want to protect their intellectual property. But most new
hires sign a confidentiality agreement, which more than offsets the issue. And when a company
tries to prevent employees from taking any sort of knowledge to other companies, or as in this
case, form their own business, they are confusing the employee--the 'key asset' that they claim
to value so highly - with the product. My take is that In the end, noncompetes are not only bad
for the workers signing away their rights, but also have negative ramifications for companies,
industries, innovation, production, employment, the economy, and the jet stream. I just threw
that last one in to see if you were still paying attention Gina.. .
Here's looking at you Gina