UPDATE: On August 20, 2024, the U.S. District Court for the Northern District of Texas, in the Ryan lawsuit, struck down a final Federal Trade Commission rule―which was set to go into effect on September 4, 2024, and ban noncompetition agreements for virtually all U.S. workers―holding that the rule shall not be enforced by the FTC or take effect as to any workers or employers.

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The Federal Trade Commission will vote at an open commission meeting to be held virtually on Tuesday, April 23, 2024, at 2:00 p.m. Eastern on its proposed rule banning employers from entering into noncompete agreements with workers. As reported in our prior Alert, the proposed rule would prohibit employers from entering into, maintaining, enforcing or threatening enforcement of a noncompete clause with virtually any worker and invalidate existing noncompete clauses with both current and former workers. If issued, the final rule would go into effect 60 days following its publication in the Federal Register, and companies would have to be in compliance 180 days after publication. If the noncompete rule takes effect in the same or substantially same form as the proposed rule, it almost certainly will be subject to immediate legal challenges.

For More Information

If you have any questions about this Alert, please contact Lawrence H. Pockers, Shannon Hampton Sutherland, Eve I. Klein any of the attorneys in our Non-Compete and Trade Secrets Group, Sean P. McConnell, any of the attorneys in our Antitrust and Competition Group, any of the attorneys in our Employment, Labor, Benefits and Immigration Practice Group or the attorney in the firm with whom you are regularly in contact.

Disclaimer: This Alert has been prepared and published for informational purposes only and is not offered, nor should be construed, as legal advice. For more information, please see the firm's full disclaimer.