By Samantha Halem, Tavish Brown August 22, 2024
On August 20, 2024, the Federal District Court for the District of Northern Texas issued its anticipated final order in Ryan, LLC v. FTC, concerning the lawfulness of the FTC’s non-compete ban. The order concluded that the FTC exceeded its statutory authority in issuing the ban. As such, the court “set aside” the non-compete ban, holding that the ban “shall not be enforced or otherwise take effect on its effective date of September 4, 2024, or thereafter.”[1]
The order has nationwide effect. Thus, unless the order is vacated on appeal (if appealed), employers in any jurisdiction do not have to comply with the ban. The FTC has thirty days to appeal the order.
The bottom line: the FTC’s non-compete ban will not go into effect on September 4th, if at all.
Hirsch Roberts Weinstein will continue to monitor the matter for developments. In the interim, employers may continue to utilize non-compete agreements with employees to the extent permitted under other applicable federal and state laws.
Questions?
For any questions about compliance with laws concerning non-compete agreements or other restrictive covenants, do not hesitate to reach out to the lawyers below or any other member of the Hirsch Roberts Weinstein team.
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[1] For a refresher on the FTC’s non-compete ban, please review Hirsch Roberts Weinstein’s client alert regarding the ban here.
