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Background
In May 2024, just a few months ago, this this firm published a blog regarding the Federal Trade Commission’s nationwide ban on non-compete agreements (Noncompete Rule).
The blog explained the history behind the Noncompete Rule, how and why the Federal Trade Commission (FTC) recently determined that non-compete agreements violated the Federal Trade Commission Act, defined non-compete agreements and related terms, and detailed steps employers must take to notify certain workers bound to non-compete agreements prior to the effective.
At that time, the FTC’s Noncompete Rule effective date was September 4, 2024.
Challenging Lawsuits
The blog also noted that several plaintiffs challenged the FTC’s Noncompete Rule. One involved a Texas tax service firm that claimed the FTC did not have the constitutional authority to issue the rule.
On July 3, 2024, the United States District Court Judge in Ryan LLC v. Federal Trade Commission issued a temporary order prohibiting the FTC from enforcing the Noncompete Rule. At present, the ruling pertains only to the parties. The court, however, expects to issue a final ruling by August 30, 2024. The court could expand the ban and completely prohibit the Noncompete Rule.
The challenge brought in the United States District Court for Eastern District of Pennsylvania, ATS Tree Services, LLC v. The Federal Trade Commission, which seeks a nationwide injunction against the ban is still pending. The ATS Tree Services Court has indicated it will issue its decision by July 23rd.
Watch this space for further developments.
The Fleischmann Law Firm, P.C.
The Fleischmann Law Firm specializes in business law and can guide your corporation through these and other rule and notice updates and changes.
The firm’s attorneys partner with you to minimize risk and liability, offer objective and fair assessments, and weigh all circumstances and options. They offer solid recommendations and provide superior representation.
Attorney Craig J. Fleischmann and staff offer over three decades of experience, integrity, cost-effectiveness, value, and integrity. Contact the Fleischmann Law Firm today.
