On Friday, September 5, 2025, the Federal Trade Commission (FTC or the Commission) brought its multiyear effort to ban employee noncompete agreements to a conclusion. As readers of this blog will certainly remember, in April 2024, the FTC voted to adopt a regulation (the Noncompete Rule or the Rule) that would have banned the great majority of employee noncompete agreements across the country. The Noncompete Rule was immediately challenged in court and, in August 2024, a federal court in Texas held the Noncompete Rule unlawful and issued a broad order vacating the Rule in its entirety. The FTC appealed that decision to the Fifth Circuit Court of Appeals but, given the subsequent change in presidential administrations, it was long anticipated that the Trump-Vance FTC was likely to abandon its efforts to defend the Biden-era Noncompete Rule. On September 5, these expectations came to fruition, as the FTC finally and definitively announced its decision to “accede to the vacatur” of the Noncompete Rule. This means that the Texas court’s order remains in place, with the result being that the Noncompete Rule cannot take effect or be enforced in any form.
While this decision marks the end of the FTC’s efforts to ban employee noncompete agreements outright, the FTC has made clear that it will continue to challenge overbroad noncompete agreements going forward. In fact, the day before announcing the end of the Noncompete Rule, the FTC announced a consent order restricting one...
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