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ARTICLE · 22 MAY 2025

Noncompete Bans Proliferate In States

Manatt, Phelps & Phillips, LLP
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With the Federal Trade Commission's (FTC) proposed ban on noncompete agreements facing a nationwide injunction...

United StatesEmployment and HR
Stephanie Roeser
Stephanie Roeser

With the Federal Trade Commission's (FTC) proposed ban on noncompete agreements facing a nationwide injunction, states are stepping forward to enact their own laws.

In April 2024, the FTC issued a final ruling finding that noncompete agreements constitute an unfair method of competition in violation of Section 5 of the FTC Act, banning nearly all noncompetes.

The rule, set to take effect in September 2024, faced immediate challenges in multiple courts before a nationwide injunction halting its enforcement was issued.

In response, New York, Ohio, Texas, Virginia, Washington and Wyoming have all introduced or enacted legislation of their own, potentially joining California, Minnesota, North Dakota and Oklahoma to prohibit such agreements.

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