On September 4, 2025, the FTC announced an enforcement action and proposed settlement with Gateway Pet Memorial Services (the “Company”), a pet cremation company, over the Company’s overuse of post-employment non-competes with certain terms it found concerning. At nearly the same time, the FTC withdrew its appeals pending in the Fifth and Eleventh Circuits of district court rulings issued last year, which enjoined the FTC from enforcing its final rule banning most non-competes nationwide.

In an accompanying statement, Chair Andrew Ferguson, joined by Commissioner Melissa Holyoak, emphasized their dissent to the non-compete final rule (issued by the FTC during the previous administration), and signaled that, going forward, the FTC will step away from broad rulemaking in this area and instead pursue a “steady stream” of enforcement actions to define, case by case, the boundaries of lawful non-compete agreements under the FTC Act and the Sherman Act.

In addition, in his statement concurring with the withdrawal of the FTC’s appeals, Commissioner Mark Meador set forth his views on the “appropriate framework” for evaluating non-compete agreements. Commissioner Meador identified several factors that impact the “competitive character” of a non-compete, including:

• Employee wage and skill level: non-competes may be harder to justify for low-wage roles, but more defensible for highly skilled employees.
• Deployment in a distribution network: non-competes may present greater concern...

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