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The United States District Court for the Northern District of Texas issued an order blocking the Federal Trade Commission’s (FTC) non-compete ban from taking effect on Aug. 20, 2024. In Ryan LLC v. Federal Trade Commission, 2:24-cv-986, Plaintiffs successfully argued that the FTC exceeded its statutory authority in propounding a nationwide ban on non-compete agreements. Originally set to take effect on Sept. 4, 2024, the ban—which would have voided millions of employment agreements—has now been paused as a result of the decision.Continue Reading FTC’s non-compete ban blocked by Texas federal judge

The dust is still settling after the U.S. Federal Trade Commission (FTC) issued its long anticipated final Rule on Tuesday, April 23 banning most non-compete agreements in the employment context. Although the effectiveness of the Rule is likely to be delayed, potentially for years, by court challenges, employers are understandably jittery about their existing non-compete agreements and other restrictive covenants.  Here with answers to some of the most commonly asked questions are Porter Wright employment attorneys Jennifer Huelskamp and Nicole Mayo. Continue Reading Answers to common questions about the FTC’s non-compete ban: What’s next?

On Jan. 5, 2023, the Federal Trade Commission (FTC) announced a slate of proposed rulemaking. Of interest to employers in particular is a proposed rule that would completely ban the use of non-competition or non-compete agreements, which prevent employees from working for a competitor or starting a competing business. Typically, these agreements often last months or years and are limited to a certain geographic scope. The FTC noted that it believes non-compete agreements often have the effect of lowering workers’ wages.Continue Reading FTC announces proposed rule prohibiting non-compete agreements

Apple, Adobe, Google, and Intel had a $415 million settlement approved last week to settle the terms of a lawsuit brought by software engineers alleging that the companies had violated wage and anti-trust laws by agreeing not to recruit or “poach” each other’s employees.

The case began in 2009 when the U.S. Department of Justice…

We previously discussed here the antitrust case involving several high-tech companies who allegedly entered into bilateral agreements in which they agreed not to solicit each other’s employees. These companies settled with the U.S. Department of Justice and were subsequently sued by a class of software engineers. Early on, Intuit and Pixar/Lucasfilm settled, and recently the…

Sometimes, the worlds of antitrust law and employment law intersect. For example, as most businesses know, it is generally permissible under federal, state, and local law for employers to enter into non-recruitment or non-competition agreements with their employees that are reasonably tailored to prevent unfair competition. A non-recruitment agreement typically prohibits an employee from stealing…

Describing it as a “rather novel issue,” a federal court recently held that a former employee’s public posts on his personal Facebook page did not constitute solicitation of his former co-workers under the terms of his non-solicitation agreement with his former employer. [See Pre-Paid Legal Services, Inc. v. Cahill, No. 12-CV-346, Doc. 31 (Jan. 22, 2013), Report and Recommendation affirmed and adopted, Doc. 32 (Feb. 12, 2013)] The court further noted that invitations sent to former co-workers to join Twitter were not solicitations under the agreement because the invitations did not request the co-workers to “follow” the former employee, they did not contain any information about the new employer, and they were sent by Twitter instead of as targeted email blasts by the former employee.

Though the court found that the former employee’s social networking activities did not constitute solicitation under his agreement, it did enter a preliminary injunction against the former employee based on his direct solicitation of one of his former co-workers through a private in-person meeting and follow up text messages sent to the co-worker. The court entered the injunction until the issues could be presented to an arbitrator pursuant to the parties’ arbitration agreement.Continue Reading Facebook Posts Not “Solicitation” Under Former Employee’s Restrictive Covenant Agreement

In Nitro-Lift Technologies, L.L.C. v. Howard, the U.S. Supreme Court this week held that if a contract contains an arbitration provision and there is a challenge to the validity of the contract, it is for the arbitrator and not a court to hear that challenge. The case is important for employers because the challenge was to the validity of a non-competition agreement.
Continue Reading United States Supreme Court: A Challenge To The Enforceability Of A Non-Competition Agreement Must Be Presented To The Arbitrator, And Not A Court, If The Contract Contains An Arbitration Provision