As we continue to report, noncompete agreements have been subject to unprecedented scrutiny over the past few years. Last April, the Federal Trade Commission (FTC) finalized a rule (“Final Rule”) ostensibly banning noncompetes, which has been mired in significant legal challenges. Additionally, four states have banned noncompetes (California, Minnesota, North Dakota, and Oklahoma), and the list continues to grow, with Ohio recently joining the list of states with proposed bans. In light of these developments, we have provided guidance to employers seeking to incorporate noncompete provisions in their employment agreements. However, employers in states with existing or proposed noncompete bans can still protect their legitimate business interests through other tools, even without ordinary noncompetition agreements.
Noncompetes Incident to the Sale of a Business:For starters, even if ordinary employment-based noncompetes are banned, there may be exceptions to the general prohibition. For example, the FTC’s ban on noncompetes contains an express carveout for the “bona fide sale of a business entity, of the person’s ownership interest in a business entity, or of all or substantially all of the business entity’s operating assets.” Even California — widely regarded as one of the most hostile jurisdictions toward noncompetes — will enforce noncompetes when they are part of the sale of a business or its associated goodwill and the dissolution of a partnership or limited liability...
After Sydney Sweeney‘s Bathwater Bliss soap sold out within minutes, Dr. Squatch warned about the fake ones at Walmart. Earlier this month, the men’s personal care company launched a limited-editi...