Not So Fast: FTC Rule Barring Non-Competes Put On Hold

On Wednesday, July 3, a Texas federal judge granted a preliminary injunction preventing the FTC’s rule barring most non-competes from taking effect in September.  In the meantime, the court will consider if the FTC has authority to issue the sweeping ban. The court’s order indicates that it intends to rule on the ultimate merits of the challenge by August 30, but a review so far suggests the ban will be struck down. So for the time being, employers should continue with their non-compete strategies until they hear otherwise.

This is developing scenario and we will continue to keep employers apprised of any developments.  Please reach out to your Stradling attorney if you wish to discuss how this ruling affects your practices.