Moore & Van Allen PLLC’s Post

A vote to ban non-competes is set for next week. If passed, this rule would make non-competes unfair competition except in the circumstance of a business sale. And if passed, the rule is certain to face immediate challenges concerning the FTC’s authority to regulate in this way. #noncompete #traderegulation #businesslitigation #employment

Non-compete clauses remain what they were pre April 23, 2024, and have not been banned nationwide! Yesterday marked what was to be the end of non-competes everywhere. HOWEVER, on August 20, 2024 a federal judge conclusively struck down the FTC's total ban on non-competes. Bans on non-competes still exist in select cities and states. Please see the article below. www.highridgesearch.com

Noncompetes in the Crosshairs: It was only a brief delay in the Texas federal court (5 weeks or so) before the judge made a ruling that put a halt to the September 4 effective date of the FTC Noncompete ban. The judge ruled that the ban was beyond the statutory mandate for the FTC under the FTC Act. It has been remarkable how many folks have heard about this FTC ban and presumed that noncompetes are dead. Not so fast! Sooner or later this will hit the appellate courts who will decide it. Given the recent trends in the Supreme Court it seems like only a matter of time before this ban is struck down. If that happens it will be up to Congress and the President to change that law or for states to decide on the legality of noncompetes within their borders.

In a victory for employers, The U.S. District Court for the Northern District of Texas has struck down the FTC’s blanket ban on noncompete agreements, which was set to take place on September 4 nationwide. Despite the ruling, existing state laws governing non-compete agreements stay in place. However, the FTC and state Attorneys General may continue to challenge overly broad non-compete agreements, particularly in egregious cases, even as these agreements remain legally permissible in some states. Hence, Companies should evaluate their use of non-competes to ensure compliance with state laws and protect legitimate business interests. #legalframeworks #employmentlaws #noncompetes https://lnkd.in/gEZzvTCP

⚖ 🗣 On August 20, the U.S. District Court for the Northern District of Texas issued a significant ruling in Ryan, LLC v. Federal Trade Commission, 𝐛𝐥𝐨𝐜𝐤𝐢𝐧𝐠 𝐭𝐡𝐞 𝐞𝐧𝐟𝐨𝐫𝐜𝐞𝐦𝐞𝐧𝐭 𝐨𝐟 𝐭𝐡𝐞 𝐅𝐓𝐂 𝐑𝐮𝐥𝐞 𝐭𝐡𝐚𝐭 𝐰𝐨𝐮𝐥𝐝 𝐡𝐚𝐯𝐞 𝐛𝐚𝐧𝐧𝐞𝐝 𝐧𝐨𝐧𝐜𝐨𝐦𝐩𝐞𝐭𝐞 𝐚𝐠𝐫𝐞𝐞𝐦𝐞𝐧𝐭𝐬 𝐧𝐚𝐭𝐢𝐨𝐧𝐰𝐢𝐝𝐞. Initially scheduled to take effect on September 4, 2024, the rule was found to exceed the #FTC's authority and be overly broad and based on inconsistent evidence. 𝐀𝐬 𝐚 𝐫𝐞𝐬𝐮𝐥𝐭, 𝐞𝐱𝐢𝐬𝐭𝐢𝐧𝐠 𝐧𝐨𝐧-𝐜𝐨𝐦𝐩𝐞𝐭𝐞 𝐚𝐠𝐫𝐞𝐞𝐦𝐞𝐧𝐭𝐬 𝐫𝐞𝐦𝐚𝐢𝐧 𝐞𝐧𝐟𝐨𝐫𝐜𝐞𝐚𝐛𝐥𝐞, 𝐚𝐧𝐝 𝐧𝐞𝐰 𝐨𝐧𝐞𝐬 𝐜𝐚𝐧 𝐬𝐭𝐢𝐥𝐥 𝐛𝐞 𝐟𝐨𝐫𝐦𝐞𝐝. However, this isn't the final word. The FTC is expected to appeal, and the case may eventually reach the Supreme Court of the U.S. Employers should stay vigilant and continue reviewing their non-compete agreements to prepare for any potential future changes. It's also worth noting that while this ruling applies at the federal level, individual states may still impose their own restrictions on non-compete agreements. For more details, you can read the court’s decision https://lnkd.in/g6MT26RW #noncompetes #ftcrules #executivesearch

While the FTC's new rule in ending non-compete agreements is a great step, it's not a slam dunk. The rule is already facing legal challenges, and because the FTC makes rules, not laws, there could still be fights over existing agreements. Stay tuned for updates! #FTCRule #NonCompeteFight #KeepYourOptionsOpen #noncompete #texasemploymentlawyer

In a major ruling, a Texas federal judge has overruled the FTC’s nationwide ban on non-compete agreements. This decision keeps non-competes enforceable in many jurisdictions, but the legal battle is far from over. Employers, make sure your agreements comply with state laws, and employees, be aware of your rights. Stay informed as the landscape continues to evolve. Need advice? We’re here to help. Contact us at team@lengealaw.com for personalized guidance on this critical issue. Read more: 🔗 https://lnkd.in/e5SpvuGZ #LegalNews #NonCompete #EmploymentLaw #LengeaLaw

FTC VOTES TO APPROVE RULE BANNING NONCOMPETES Today, the FTC voted 3-2 to ban most noncompete agreements in the United States. The Rule, if it survives anticipated legal challenges, takes effect in 120 days and could have a profound impact on employers. Click the link below for a brief summary. Stay tuned for a more detailed analysis of the FTC's Rule. #FTC #NoncompeteAgreements #EmploymentLaw

Earlier this year, the Federal Trade Commission (FTC) announced a final rule which would have banned almost all non-compete clauses nationwide. On August 20, 2024, a federal judge in Texas blocked the ban on non-competes that was set to take effect on September 4, 2024. This means that for now, non-competes will continue to be enforceable under federal law and employers will not have to issue any notices to employees on this subject. It’s important to note, however, that non-competes are still subject to any applicable state requirements. We will be watching for appeals on this, but for now, this rule will not take effect. #compliance #ftc #noncompetes

The ND Texas Court that had the Ryan LLC case challenging the FTC's ban on non-compete agreements just handed down its final judgment in the case, effectively striking down the FTC's Rule on non-compete agreements. Unlike the previous orders in this case, which were limited to the participating parties, the final judgment applies nationwide unless an appellate court reverses. As such, it is safe to say that the September 4th deadline will not have to be complied by employers (there is no chance the 5th Circuit will hear the case before that nor issue a stay in favor of the FTC). Big picture: Non-Competes are back (well, they never left).