Category Archives: Fair Competition News

Fairly Competing, Episode 12: Wisk Aero LLC v. Archer Aviation Inc. (How to Avoid Dismissal and Get an Injunction in Trade Secret Cases)

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Episode 12 of Fairly Competing is out! In this episode, Ben Fink, John Marsh, and I explore Wisk Aero LLC v. Archer Aviation Inc., an extremely well-reasoned decision offering an object lesson about preliminary injunctions in trade secret cases, highlighting that it’s no longer safe to assume you will get a preliminary injunction simply because a former employee downloaded 5,000 documents — even if he invokes the 5th Amendment.

FTC Commissioner Wilson Testifies to Congress about Noncompetes

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“Non-compete agreements that are unreasonable as to temporal length, subject matter, and/or geographic scope will be found to violate both federal and state antitrust laws.”

That’s new — especially because it’s from Federal Trade Commission Commissioner Christine Wilson.

But, at the end, Commissioner Wilson observed, “The elected officials in each state are best situated to weigh the costs and benefits of non-competes and make decisions tailored to the unique circumstances in their jurisdictions. . . . A federal solution at this time is premature.”

Another Step Closer to FTC Regulation of Employee Noncompetes?

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Contracts containing restrictive covenants (noncompetes, nonsolicitation agreements, and the like) have been the province of state regulation for over 200 years. However, starting in 2015, the federal government has been stepping into the breach through proposed legislation (most recently two bills to ban all employee noncompetes and one to amend the FLSA to ban noncompetes for nonexempt workers), FTC review (starting with a workshop in January 2020), and an Executive Order (on July 9, 2021) “encouraging” the FTC to “curtail the unfair use of non-compete clauses . . . .” While that’s not news, what is news is that earlier this week (September 14, 2021), the FTC issued a public statement that — if it is as broad as it appears — seems to presume that the FTC has authority to regulate these types of contracts.

Are Noncompetes Ethical?

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A recent paper, “The Ethics of Noncompete Clauses,” by University of Georgia Professor Harrison Frye, expands the policy discussion around noncompetes, and argues for a more thoughtful analysis. As Professor Frye details, seeing noncompetes “as solely advancing the interests of employers is myopic.”

Eight States with 24 Noncompete Bills: New Jersey

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If you’ve been following along with this series of posts, you know that there have been 66 noncompete bills pending in 25 states this year — plus three pending federal noncompete bills, D.C.’s new law to ban most noncompetes, and a bill to rein in D.C’s new law before it becomes effective (which is anticipated to be in April 2022). Today’s post discusses New Jersey’s proposed noncompete legislation.

We Have Another Piece of the Consideration Puzzle under the Mass Noncompete Act

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On Thursday, July 15, 2021, United States District Court Judge Hillman issued what I believe is the first (readily available, anyway) non-dicta, substantive decision on the Massachusetts Noncompetition Agreement Act (the MNAA). Read more about Judge Hillman dismissal of a claim based on a nonconforming noncompete in KPM Analytics North America Corporation v. Blue Sun Scientific, LLC (C.A. No. 4:21-cv-10572-TSH).

D.C.’s Proposed Noncompete Ban Not To Take Effect Until Next Year — And May Be Amended

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The D.C. Council held two proceedings related to its recent noncompete ban last week. During both, at-Large Councilmember Elisa Silverman recommended pushing back the implementation date of the new law to April 1, 2022. During the hearing, the Council received wide-ranging testimony about a potential amendment: some objective, verifiable input and some partisan rhetoric; some spot on and some inaccurate. Now we wait.

Déjà vu all over again (again): The Freedom to Compete Act Redux

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As of Friday (July 16, 2021), we again have competing approaches to federal legislation proposing limits on noncompetes. In addition to the previously reintroduced Workforce Mobility Act, proposing an outright ban, Senators Marco Rubio (R-Fla.) and Maggie Hassan (D-NH) have now reintroduced the Freedom to Compete Act to ban noncompetes for most workers who are not exempt under the Fair Labor Standards Act of 1938.

Quick Update: President Biden Issued an Executive Order on Noncompetes (and other things)

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This afternoon, President Biden signed an “Executive Order on Promoting Competition in the American Economy,” which included pushing for the regulation of noncompetes by the FTC. Based on his comments during today’s press conference (discussed in the post), we expect that any regulation will be balanced, focusing on regulating the abuses, rather than a throw-the-baby-out-with-the-bathwater wholesale ban.
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