On Tuesday, August 20, a Federal Judge in Texas struck down the Federal Trade Commission (FTC) Final Rule that has implemented a nationwide ban on noncompete agreements for employees. Judge Ada Brown reasoned that the FTC, as an administrative agency, exceeded its prescribed authority given to it by Congress.
With the Final Rule struck down, this means that, for now, businesses no longer have to comply with the noncompete restrictions proposed by the FTC, and the previous deadline of September 4, 2024 for removing such clauses from employment contracts is no longer in effect.
The FTC has indicated they are considering an appeal of the ruling. Further legal developments are expected. Buxton & Collie will continue to monitor these developments and will provide updates to this page as they become available.
