After a series of preliminary, narrowly decided, and conflicting court decisions concerning requests for preliminary injunctions (see August 20, 2024 Alert), a federal district court in Texas has now entirely set aside the Federal Trade Commission (FTC) rule that would have invalidated tens of millions of non-compete agreements in the United States (see judge’s order). The court ordered that “[t]he Rule shall not be enforced or otherwise take effect on its effective date of September 4, 2024, or thereafter.” This is hardly the final chapter in this saga, however, and both employers and employees should be aware not only of the inevitable appeals and the possibility of the non-compete rule’s revival but also of other state and federal laws that will continue to impact non-compete agreements.
