Category Archives: Noncompetes

Once again, we have resounding unanimity on the issues and recommendations to the FTC and DOJ, as they consider whether to regulate (and if so, how) noncompetes, nondisclosure agreements, and other restrictive covenants. 70 lawyers who practice extensively in the area of trade secret and restrictive covenant law agree: federal regulation is likely inappropriate, definitely premature, and, in any event, should be limited.
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.
“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.”
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.”
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.