Federal court in Texas halts FTC action on non-competes

A Federal Trade Commission rule that would ban company employee non-compete agreements has been temporarily halted by a U.S. district court in Texas.

“The FTC’s blanket ban on noncompetes is an unlawful power grab that defies the agency’s constitutional and statutory authority and sets a dangerous precedent where the government knows better than the markets,” said U.S. Chamber’s Chief Counsel Daryl Joseffer after a preliminary injunction was granted by Judge Ada Brown of the Northern District of Texas.
The tax firm Ryan LLC filed the suit with the U.S. Chamber earlier this year. Judge Brown intends to make a final ruling “on or before August 30, 2024,” according to the injunction order.

Separately, the U.S. Chamber is one of the TBA’s co-plaintiffs challenging the joint federal banking agencies’ CRA rule in the Northern District of Texas. The court has already issued a preliminary injunction in our CRA suit, stating that TBA and our aligned co-plaintiffs have a substantial likelihood of prevailing on the merits of that case.

Read more on the preliminary injunction here.