For 2025, and perhaps beyond, the writing appears to be on the wall for true non-competes. Prudent employers looking down the road should make sure they are doing what they can to strengthen their other restrictive covenants and protection of confidential information and trade secrets.
Articles Discussing Restrictive Covenants In The Workplace And Other Topics Relating To Unfair Competition.
Countering the Trend Against True Non-Competes
“All of this is to say that for 2025, and perhaps beyond, the writing appears to be on the wall as to true non-competes. They, whoever they are, are coming for employers who are aggressive in their choice of which employees are bound by true non-competes, the extent of the restrictions and the enforcement actions taken.”
2024’s Top Stories in Unfair Competition and Trade Secrets Law
Federal agencies continued their efforts to restrict the use of restrictive covenant agreements in employment, but such efforts appear largely to have fallen short. Washington expanded and clarified its non-compete statute, while six other states passed laws restricting the use of non-compete agreements in the healthcare sector.
Federal Trade Commission’s Non-Compete Rule Update
Labor and employment attorney Mitchell Greggs discusses the latest news regarding the FTC’s Non-Compete Rule and how employers can navigate the changing developments.
FTC Appeals Injunction Against Final Rule Banning Non-Compete Employment Agreements
By: FTC Appeals Injunction Against Final Rule Banning Non-Compete Employment Agreements
Last Friday, the Federal Trade Commission (“FTC”) gave notice to appeal Judge Brown’s nationwide bar on the FTC’s final rule creating a Non-Compete Ban or enforcement of the rule in the case of Ryan LLC v. Federal Trade Commission. This appeal followed another appeal by the FTC of an adverse ruling from Properties of the Villages, Inc. v. Federal Trade Commission.
While it is still early days on the appeals, because the Ryan appeal is within the Fifth Circuit and the Villages appeal is within the Eleventh Circuit, conflicting opinions could result. And, if there are conflicts among the Circuit Courts, the United States Supreme Court will likely give the last word as to whether the FTC’s ban must be followed or not.
For the moment, employers are relieved from any Federal rules in this area but should continue to monitor and ensure compliance with state laws governing non-compete agreements in the employment arena.
If you need assistance with determining the enforceability of non-compete agreements, please reach out to Dan M. Forman or your favorite CDF attorney.
FTC Appeals Texas District Court Ruling That Blocked Noncompete Ban to Fifth Circuit
The Federal Trade Commission (FTC) is appealing a Texas federal court ruling that struck down the FTC’s noncompete ban nationally, teeing the case up to be heard by the U.S. Court of Appeals for the Fifth Circuit.
Why Employers’ Non-Competes Could Still Be at Risk Despite FTC Rule Being ‘Set Aside’
Related links:
Workplace Law After ‘Loper’: Are Non-Competes Dead?
The recent SCOTUS Loper Bright decision, the FTC’s final rule banning non-competes, and ongoing litigation may present significant challenges for employers enforcing non-compete agreements.
FTC to Appeal Florida Court’s Preliminary Injunction of Noncompete Ban Following Texas Court’s Block
The Federal Trade Commission (FTC) is appealing a Florida federal court ruling temporarily blocking the FTC’s noncompete ban a month after a Texas federal judge in a separate case blocked the FTC’s ban on a nationwide basis.
Court Rules Federal Trade Secrets Law Applies To Conduct And Sales Outside The U.S.
Battle Over/War Isn’t: Employer Considerations Now That FTC Non-Compete Ban Is Set Aside
A Texas court has set aside the Federal Trade Commission’s (FTC’s) Final Rule banning almost all non-compete clauses days before it was set to take effect on Sept. 4. Ryan LLC v. FTC, No. 3:24-CV-00986-E, 2024 U.S. Dist. LEXIS 148488 (N.D. Tex. Aug. 20, 2024). The court’s ruling bars the FTC from enforcing the Final Rule nationwide. Although the FTC lost this battle, it may be winning the war.
Federal Judge Stymies FTC Efforts to Outlaw Non-Compete Agreements
On August 20, 2024, Judge Ada Brown of the US District Court for the Northern District of Texas set aside the Federal Trade Commission’s (FTC) rule that effectively prohibited the use of non-compete agreements. Interpreting the Administrative Procedure Act, which provides for judicial review of the actions of federal agencies like the FTC, the court found that the FTC’s non-compete ban was unlawful.
Court Issues Nationwide Injunction Against FTC’s Noncompete Ban
As of yesterday afternoon, employers across the country that utilize noncompete agreements may breathe a sigh of relief, as Judge Ada Brown beat her self-imposed deadline of August 30, 2024 and ordered an end to any enforcement of the Federal Trade Commission’s (“FTC”) Noncompete Rule.
Judge Brown, of the Northern District of Texas, evaluated competing motions for summary judgment filed by the Plaintiff, the related parties, and the FTC. She denied the FTC’s motion and granted the Plaintiffs’ motions. In reaching her decision, Judge Brown concluded that the FTC both exceeded its statutory authority derived from the Federal Trade Commission Act when it issued the Noncompete Rule earlier this year, and acted in an arbitrary and capricious manner in violation of the Administrative Procedures Act (“APA”).
Judge Brown concluded that the Federal Trade Commission Act provided a limited role for making “housekeeping” rules to preclude unfair and deceptive practices, and as a result, the FTC lacks the authority to create substantive rules such as the Noncompete Rule that it promulgated.
Federal Court Vacates FTC Non-Compete Ban
The post Federal Court Vacates FTC Non-Compete Ban appeared first on Hirsch Roberts Weinstein LLP.
Federal District Court Blocks FTC’s Noncompete Rule
Real World Impact: Making good on her promise to make a ruling on the FTC Noncompete Rule on or before August 30, 2024, United States District Judge Ada Brown granted a motion for summary judgment that sets aside the FTC Noncompete Rule and prohibits its enforcement nationwide. This means employers should go “pencils down” and stop preparing the notices we suggested here. The FTC Noncompete Rule is no longer a concern.