Employment / 1 min read
On July 3, a federal trial court entered a preliminary injunction staying the effective date on the Federal Trade Commission’s (FTC) ban on noncompete clauses. The Court’s order also prevents the FTC from enforcing the ban.
The preliminary injunction, however, is limited to the plaintiffs in that lawsuit. Thus, the ruling applies only to the parties in the case and, at least for now, does not apply nationwide. The effect is that the noncompete ban is still alive for everyone who is not involved in that lawsuit.
FTC Overreach. The Court found that the FTC lacks substantive rulemaking authority for unfair methods of competition and that the noncompete ban was arbitrary and capricious.
Final Ruling Coming. The Court will issue a final decision by August 30, 2024, which might block the FTC’s noncompete ban nationwide. Stay tuned.