Texas Court’s Non-Compete Decision Good for Business

In welcome news to the business community, a federal judge in Texas invalidated the Federal Trade Commission’s attempted ban of non-compete agreements. “The role of an administrative agency is to do as told by Congress, not to do what the agency thinks it should do,” Judge Ada Brown, wrote.

More on Judge Ada Brown’s ruling can be found here, but generally speaking this ruling permanently enjoins the Federal Trade Commission’s enforcement of the Commission’s proposed non-compete ban on a nationwide basis. Our firm will provide further analysis on this issue as it continues to develop.  While this particular outcome is good news for employers, scrutiny on non-competes remains high.  Accordingly, employers should carefully tailor their restrictive covenant agreements such that they only protect their legitimate business interests.