FTC’s Sweeping Non-Compete Ban: Summary, States’ Views, and Litigation Challenges

On April 23, 2024, the FTC voted 3-2 to adopt a final rule banning the use of non-compete agreements nationwide, impacting 30 million workers by the FTC’s own estimates. This near categorical ban on the non-compete agreements is a contrast from a regime in which these agreements had been recognized to have potential procompetitive value and therefore were reviewed for reasonableness. It also marks a departure from the state law in many jurisdictions. Less than 24 hours after the vote, two lawsuits have challenged the rule based on statutory and Constitutional grounds. This breaking news panel discussed the final rule, grounds for statutory and Constitutional challenges, and state AG reactions.
Featuring:
Tyler S. Badgley, Senior Counsel, U.S. Chamber Litigation Center
Gwendolyn J. Lindsay Cooley, NAAG Antitrust Task Force Chair and Assistant Attorney General for Antitrust, Wisconsin Department of Justice
Julian W. Kleinbrodt, Partner, Gibson, Dunn & Crutcher LLP
Chris Mufarrige, Chief of Staff, FTC Commissioner Melissa Holyoak
Moderator: Alexander P. Okuliar, Co-chair, Global Antitrust Law Practice Group, Morrison Foerster
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As always, the Federalist Society takes no position on particular legal or public policy issues; all expressions of opinion are those of the speaker.

[@KFitzG35competitor]

Anyone arguing against this ruling, is an idiot. This ruling is beyond necessary, if a company wants to keep employees, they need to make sure they have a reason for employees to stay, not ways to force them to stay.

[@nickstockbridge3334]

It is my understanding: The ruling is basically saying I can work for both McDonalds and Burger King (names just as examples). So I can work for or start my own business in that industry, while working for that business. However this ruling doesn't over turn non-disclosure, non-solicitation, or non-recruitment agreements. Still cannot sell trade secrets, take clients, or other employees. If such agreements were/are signed.

[@Eduardo-bi2rv]

Huge W

[@kylemccormack1785]

I can't believe there are any sane humans arguing in favour of literally owning other humans. Which is what a non-compete is. It is a contract in which you engage in legal slavery.

[@EricSchumann007]

Legal slavery and in most cases no consideration (money) to bind the contract