Quick Update: Small Business Majority seeks to tag in for the FTC, FTC says no

There are currently two appeals of adverse rulings on the FTC’s Noncompete Rule. One is pending in the 5th Circuit in the Ryan LLC case, which “set aside” (read “vacated”) the Rule. The other is in the 11th Circuit in the Properties of the Villages case, which issued a preliminary injunction prohibiting the FTC from enforcing the Rule against the plaintiff.

With the change of Administrations, conventional wisdom is that the FTC will dismiss both appeals.

In that regard, Chair Ferguson and the other republican commissioner, Commissioner Holyoak, have been outspoken critics of the rule. In a joint dissent on the vote to issue the Rule, the Chair Ferguson and Commissioner Holyoak questioned the FTC’s power to issue it and the wisdom of a wholesale ban. Now that Chair Ferguson has been appointed, and especially with former-Chair Lina Khan announcing that she will be leaving the FTC by the end of the month, the handwriting is indelibly on the wall.

While the 5th Circuit and U.S. Supreme Court are both likely to keep the Ryan Court’s set-aside order in place and the 11th Circuit is likely to keep the preliminary injunction in the Properties of the Villages case in place, it’s not over until it’s over.

So, for those opposed to the ban, it’s good news that the FTC will likely drop the appeals.

But if you’re in favor of the ban, it’s bad news.

For those in favor, enter the misnamed, Small Business Majority.¹ Recognizing the fate of the FTC’s Rule, on January 13, 2025, the Small Business Majority filed a Hail Mary motion to intervene to allow it to pick up the ball in both the 5th Circuit (in the Ryan appeal) and the 11th Circuit (in the Properties of the Villages appeal) in case the FTC dismisses those appeals.

Not surprisingly, the FTC opposed the motion in the Ryan appeal and in the Properties of the Villages appeal. Also not surprisingly, Ryan also opposed the motion in its case and Properties of the Villages opposed in its.

Presumably, the Small Business Majority will file reply briefs in both cases.

Stand by.

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Firm resources: 

We know how hard it is to keep up with the ever-changing laws and requirements around the country for how you can protect company’s trade secrets, customer goodwill, and the integrity of your workforce. To help, we have created the following resources (available for free):

	50-State Noncompete Law Chart, the first of its kind and regularly updated (downloadable PDF) (to be updated for the new exemptions in Illinois and Pennsylvania)50-State and Federal Trade Secret Law Chart, providing a comparison of the trade secrets laws nationally to the Uniform Trade Secrets Act (downloadable PDF)
	Chart of Noncompete “Low-Wage” Thresholds and Criteria (downloadable)
	Notice requirements summary chart, providing details for each of the 8 states (plus D.C.) that has notice requirements related to noncompetes (downloadable PDF)
	“Changing Trade Secrets | Noncompete Laws” (dedicated blog page) now provides a current detailed summary of the changing landscape of trade secret laws and noncompete laws around the country, state by state and at the federal level
	Trade secret and other legitimate business interest protection plan strategy and checklist

We hope you find all of these resources useful. More will be coming.

And please note, we are grateful for all of the input we’ve received over the years. We welcome any suggestions for improvements that you may be willing to share.