Phase Three Brewing (2019)

In Illinois, there are probably a number of brewers who aren't paid enough to even legally be bound in a non-compete. The Illinois Freedom to Work act prohibits non-competes on employees who aren't making $13 an hour or minimum wage (whichever is greater) and the minimum wage is on its way to $15 an hour. Besides that, there is also fairly recent case law in Illinois (Reliable Fire Equip. Co. v. Arredondo) that sets up "rules" for what constitutes reasonable "restraint of trade" for an employee. Under those rules, I also doubt you could keep most non-owner brewers in Illinois tied up with a non-compete.

Their best bet would have been to give him some equity and tie him up in the Operating Agreement for the corporation... then he would have had to walk away or sell his interests BEFORE he started ANY work on P3 otherwise they could have sued him for a breach of his fiduciary responsibility to them.

 

Why would this matter? If the beer is good, you will probably drink it.

 

Can we get back on track and talk about the beer? How does it taste?

 

Different era and much smaller system. To make a competitive brewery at a level worthy of an established brewer they would need significantly more money that PW started with. I doubt Shaun wants to run the equivalent of a garage operation for the next 4 years.

 

They couldn't have waited a week to release it during Miami Pride Week?

 

Zero time wasted

 

Zero fucks also given

 

Jesus Christ, your posts make me so God-damned hard.

Keep going . . . I'm almost there.

 

Feeling like a broken record here, but why do people keep saying they should have signed him to a non-compete? As if they are the only ones to make that choice! That's not how it works! That's not how any of this works!

M: "We're starting a brewery! Want to be a head brewer? We'll pay you XOXO and give you creative freedom."
S: "Yes, that sounds great, I have been thinking about leaving for a while!"
M: "Oh, also, you have to sign a non-compete clause"
S: "Never mind."

 

More should be fine, its probably the best restaurant in VP anyways and the locals seems to enjoy going there and they probably didnt even know who Shaun was

 

Yeah I think people are really overestimating shauns impact on getting people in the brewery. They will still be busy just about every day because they have an incredible taproom and hands down the bets food you can get at a brewery in the area. As others have said, I also enjoy that they have TV's and it's not some beer sanctuary where you can't see sports.

They will be fine. They might not be making anything new and crazy, but I'm sure they can still push out the stuff they've been doing with shaun.

 

Exactly. I'd bet 75% of people that go there regularly (not just for releases) have any idea who shaun is.

 

I think most people in this forum would agree with this. The brewpub in VP will be fine as locals will still frequent it. The much bigger issue was More's plan for expansion and distribution which I think are going to have to be reevaluated. At least in the short term. I'd be curious to see if More has/will go through with the financing for expansion anyway. Not sure if there was any commitment made on the space they were looking to expand into.

 

Well I think if they opened a place in areas with no breweries they will be successful with or without shaun. You don't need incredible beer to be a successful restaurant/brewery. I would be worried about expanding production as much as they planned with their head brewer walking out. Not sure who is stepping in but I'm guessing he won't have nearly as much experience.

 

Maybe a new thread can be created next month that is actually about Phase Three and their beer...

 

While no one asked about the finer legal points of LLC's, a person does not have a fiduciary duty to an LLC solely by virtue of their ownership of equity - he would have had to have some sort of control over the overall enterprise. And LLC agreement that's worth a dime typically waives any fiduciary duties of the members and usually the board as well. Some Operating Agreements do include noncompetes for so long as you own equity, which would have put Shaun in the position of selling or being subject to the restrictions.

Realistically they could have paid (likely did?) him enough to warrant a noncompete under his employment agreement, but to 3xAnthony's point, they could only impose reasonable restrictions in time, scope and territory, which almost certainly does not include "you cannot brew and sell beer anywhere". They probably could have stopped him from opening a brewpub in Villa Park and perhaps a 10-25 mile radius for a year or two, but much beyond that would be likely to have enforcement issues. In fact, it's possible that he is subject to a restriction along those lines and that's why opening his own space is estimated to be late 2020 rather than immediately.

And so ends today's lesson on corporate law and restrictive covenants for beer fans.

 

My favorite part of this thread is how everyone here is on a first name basis with all of the people being talked about

 

Maybe he can buy the name Speculation Brewing from it's current owners....

 

I mean, yeah, they did a Kickstarter, but.....

I wouldn't want to claim to know anything about what their costs were because I'm not affiliated, but having what knowledge I do have on the upfront costs of opening a brewery, I'm gonna go off on a limb and say the 30-40K (whatever it was after fees) they raised didn't go very far.

It's a great way to build a community around your brand, and get people involved early and get them hyped, but.... not likely to move the financial chains all that much.