Noncompete rule: FTC appears and asks for more time

A hearing on the FTC’s noncompete rule is coming soon in Tyler, Texas…

You will recall that two days ago (April 24), the U.S. Chamber of Commerce and several other organizations filed a lawsuit challenging the FTC’s authority to issue the new rule to ban noncompetes.

You will also recall that (as expected) the Chamber promptly filed a motion to stay operation of the FTC’s rule or for an injunction preventing enforcement of the rule.

Not missing a beat, yesterday, the FTC and Chair Khan entered their appearance in the case and immediately filed an unopposed motion asking for an extra week to prepare their papers in opposition to the Chamber’s motion.

The FTC and Chair Khan note that the plaintiffs conditioned their agreement not to oppose the FTC’s motion on the FTC’s agreement that the plaintiffs receive an extra five days to file their reply to the opposition.

Given this, assuming the Court grants the motion (which it is likely to do), the timeline on the motion to stay or enjoin the FTC’s noncompete rule is as follows:

  • Chamber’s motion was filed on April 24
  • FTC’s opposition will be due on May 15 (instead of May 8)
  • Chamber’s reply brief will be due on May 28

Mark your calendars for May 15! 

We’ll let you know once the hearing FTC’s noncompete rule is scheduled, but it should be in early June. 

In the meantime, don’t forget to use this time to make sure your agreements, policies, and procedures comply with existing laws, upcoming changes (in particular in Washington), and are coupled with appropriate training, especially at on-boarding and off-boarding.

And, if you are an employee making a job change, make sure you leave with nothing and start your new job in compliance with existing obligations.