Ever since reports of Jim Ross’ “retirement” surfaced, there has been a never-ending stream of speculation regarding the actual story behind this interesting situation. While a general consensus has developed that JR did not elect to leave WWE voluntarily, there continues to be a number of questions surrounding JR’s current status and his future plans.
I want to make it absolutely clear that I am not privy to any inside details regarding this situation. While this post will contain some speculation, such speculation only is meant to provide an understanding of some of the legal issues that MAY be steering the current situation. Once again, the analysis provided in this post is not meant to be read as a definitive statement of the underlying facts.
With that disclaimer out of the way, I’d like to focus on a few of the possible legal scenarios that likely are operating behind the scenes in this instance.
Many fans and analysts alike have been questioning why JR has not spoken out on this issue and, more specifically, why he has not slammed WWE. Furthermore, rumors have run rampant that JR soon will be riding on a white horse to provide his invaluable services to TNA.
A recent tweet by JR quickly shot down these rumors and implied further confirmation that legal constraints likely are guiding his present and his future. His statement that “[w]orking in wrestling [is] not an option” hints that one of two possible versions of a so-called “Non-Compete Agreement” currently is at work.
One of the most common types of Non-Compete Agreements occurs when an employee or an independent contractor first agrees to perform work for an employer (or business in the case of an independent contractor). Frequently, these arrangements will occur in a field of work that requires the employer to provide training for the worker. In those instances, the employer usually requests a Non-Compete Agreement in order to protect its investment.
As an example, an employer does not want to spend months training an individual to perform a medical sales position, only to see that individual run off to a competitor down the street at the end of training. In these situations, the parties generally will agree upon a reasonable length of time following the termination of the work relationship that the employee/contractor will wait to work within that industry within a specified radius of distance…In our example, the employee/contractor could agree not to work in the medical sales field within 50 miles of the former employer.
In general, these types of agreements are not looked upon favorably. The general public policy is to limit any type of impediment towards seeking employment. In other words, many employees/contractors are forced to agree to these conditions simply because they need to work. In such situations, the employer has a large upper-hand in an unequal bargaining situation.
Nevertheless, courts do recognize the interest of employers in seeking such agreements, and will uphold them if the time period and radius of distance is no more constraining on the individual than need be. Courts will take into consideration the sophistication of the parties involved in determining if an employer took advantage of an individual who simply needed employment.
In JR’s situation, although training is not necessarily involved, WWE certainly had the right to request a Non-Compete Agreement prior to any services that he provided. Nevertheless, I believe that a second type of Non-Compete Agreement likely is at work in this situation.
While courts are reluctant to place burdens on an individual’s ability to work, they are much less likely to set aside a restraint that results from an evenly bargained agreement. For this reason, it is highly likely that the current situation is being controlled by a Non-Compete Agreement and a Non-Disparagement Agreement that was negotiated as part of a Severance Agreement.
When JR parted ways with WWE, he had a number of legal options at his disposal. Depending on the strength of any pre-employment Non-Compete Agreement, he had the option of working for another wrestling company. Challenging such an agreement could have resulted in a costly legal battle for both JR and WWE.
He also had the legal right to participate in interviews about his current situation or any of WWE’s past treatment of him (Be a Star!) In addition, he had the right to file a lawsuit against WWE pursuant to any number of legal theories such as disability discrimination under the Americans with Disabilities Act.
When an individual holds a legal right to perform a number of acts, any interested party has the ability to offer that individual money in consideration for his or her agreement not to perform the acts. In these situations, if both parties are sophisticated and represented by legal counsel, courts generally uphold the agreements even when they contain restrictions on the ability to work. These agreements can be overturned if the restrictions on work are shockingly unreasonable, but sophisticated parties generally are presumed to be bound by the terms.
If you recall Brock Lesnar was in a similar situation back when he ended his first run in WWE. At the time he was under a 10 year contract with WWE, and when he chose to leave the company, his contract prohibited him from working for UFC, TNA, or a similar fighting/wrestling company. The court later deemed the contract unfair, and although Lesnar did sign the contract, the court ruled that the length of time in the deal was unreasonable, and prevented Lesnar from making a living.
WWE certainly has a huge interest in avoiding the negative PR that could come from an angry individual who holds the level of respect of Jim Ross. It also certainly has a large interest in ensuring that a rival such as TNA does not obtain his expert services.
Likewise, JR has an interest in receiving guaranteed income in exchange for sacrificing many of the rights discussed above. The fact that he hasn’t spoken out and hasn’t indicated an interest or ability to work for another company tells me that this likely is what occurred.
Depending on the amount WWE could have paid for such an agreement, I wouldn’t hold my breath waiting for JR to make his TNA debut any time soon.
***Nothing in the preceding column is intended to be construed as constituting legal advice***