On April 23, 2024, the Federal Trade Commission (FTC) voted to ban all employers from using noncompete clauses. Providing that employers' use of noncompete agreements amounts to an "unfair method of competition" that runs afoul of Section 5 of the FTC Act, the Final Rule bans all new noncompete agreements nationwide and renders existing noncompete agreements binding most workers unenforceable.
McDermott is closely tracking the Final Rule and related litigation as it proceeds. Explore our available insights and resources to stay up to date. For any questions, please contact your regular McDermott lawyer or one of the contacts in the resources below.
INSIGHTS
Pennsylvania Court Rejects Attempt to Block FTC Noncompete Ban: On July 23, 2024, 20 days after the Texas ruling, the US District Court for the Eastern District of Pennsylvania declined to stay the September 4, 2024, effective date for ATS Tree Services LLC.
Texas Court Postpones FTC Noncompete Ban for Ryan LLC Parties: On July 3, 2024, the US District Court for the Northern District of Texas stayed the September 4, 2024, effective date of the Final Rule, preliminarily enjoining the FTC from enforcing the Final Rule against the parties to a lawsuit filed by Ryan LLC, a private tax services firm.
Revisiting Trade Secret Strategies Following the FTC's Ban on Noncompete Agreements: The Final Rule marks a pivotal moment for trade secret protection and enforcement strategies as it promises to reshape the relationship between employers and employees and impact safeguards for proprietary information.
FTC Issues Rule Banning Worker Noncompete Agreements: The FTC voted 3-2 along party lines to ban all new noncompete agreements and render existing noncompete agreements binding most workers unenforceable.
FTC Proposes Rule Banning Noncompete Agreements: The FTC's noncompete ban was first proposed on January 5, 2023, on the heels of the FTC's policy statement in November 2022 asserting its intention to rigorously enforce and expand the scope of Section 5 of the FTC Act's ban on unfair methods of competition.
WEBINARS
FTC's Final Noncompete Rule: Developing Your Game Plan: Dive into the legal-, practical employment-, and executive compensation-related issues legal and human resources teams should consider if the Final Rule is upheld in full or in large part through this webinar's key takeaways and recording.
FTC's Final Noncompete Rule: What It Means and Next Steps for Employers: View the key takeaways from and recording of a webinar that explains the impact of the Final Rule on current noncompete agreements, examines the legal issues around enforcing a noncompete ban and ensuing litigation, and outlines what employers should do next.
What Employers Need to Know Now About the FTC's Proposed Noncompete Ban: Hear insights from our multidisciplinary team of employment and antitrust lawyers regarding the impact of the rule and legal challenges when the rule was first proposed.
IN THE NEWS
FTC, State Scrutiny of Noncompetes Shifts Labor Market, Modern Healthcare
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