---
title: Court Blocks FTC Rule Banning Employment Noncompete Agreements on a Limited Basis
description: Discover how recent judicial decisions are impacting the FTC's new rule banning most post-employment non-compete agreements. Read more on our blog!
---

[BW Insights ](https://www.brownwinick.com/insights)

# [Court Blocks FTC Rule Banning Employment Noncompete Agreements on a Limited Basis](https://www.brownwinick.com/insights/court-blocks-ftc-rule-banning-employment-noncompete-agreements-on-a-limited-basis)

 Written by [Danielle Smid](https://www.brownwinick.com/insights/author/danielle-d-smid) | Jul 10, 2024 2:40:44 PM

On [May 7, 2024, the Federal Trade Commission (FTC) issued a Final Rule](https://www.brownwinick.com/insights/ftc-publishes-final-rule-banning-non-competes) banning most post-employment non-competes for all workers, except senior executives, employed by for-profit employers. However, recent judicial decisions are stirring up problems for the Final Rule.  

## **Important Court Rulings** 

On July 3, 2024, in *Ryan LLC v. Federal Trade Commission*, the U.S. District Court for the Northern District of Texas granted a preliminary injunction, preventing the FTC from implementing or enforcing its blanket ban on noncompete agreements. However, the court declined the request for a nationwide injunction; and thus, the ruling does not affect all other employers subject to the Final Rule with an effective date of September 4, 2024.  

In its ruling, the court cited [*Loper Bright Enterprises v. Raimondo*](https://www.supremecourt.gov/opinions/23pdf/22-451_7m58.pdf), a Supreme Court case that overruled the doctrine of judicial deference to administrative interpretations of federal laws established in *Chevron U.S.A., Inc. v. Natural Resources Defense Council, Inc*. Meaning, courts “must exercise their independent judgment in deciding whether an agency has acted within its statutory authority.”  

## **What This Means Going Forward ** 

The district court stated that it intends to rule on the merits of *Ryan* on or before August 30, 2024, at which point the court could decide to expand its ruling, granting nationwide relief. The court’s reasoning in *Ryan* together with the Supreme Court’s recent decision in *Loper Bright* could mean trouble for the Final Rule.  

However, employers should remain aware of the increasing judicial scrutiny of non-competes, the recent efforts to restrict the use of non-competes, and state and local legislative proposals seeking to restrict or ban non-competes.   

We will continue to follow developments and guidance on this Final Rule. Please contact [Dani Smid](https://www.brownwinick.com/attorneys/danielle-d-smid?hsLang=en) or your BrownWinick [employment attorney](https://www.brownwinick.com/services/employment-labor) with any questions or concerns.   

[View full post](https://www.brownwinick.com/insights/court-blocks-ftc-rule-banning-employment-noncompete-agreements-on-a-limited-basis)

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