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A Texas federal judge recently struck down a Federal Trade Commission (FTC) ban on noncompete agreements that was set to take effect on Sept. 4.
The court concluded “the FTC lacks statutory authority” to ban most noncompetes, and that the rule issued by the agency was “arbitrary and capricious,” US District Judge Ada Brown wrote in an Aug. 20 opinion.
The final rule, which was issued by the FTC in April, would have banned employers from including noncompete agreements in employment contracts. Noncompetes are common in industries ranging from hair styling to medicine, and may keep workers from joining another company, or