Tag Archives: noncompete

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.”
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.
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.”
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.
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).
Over the past several years, there have been changes to the noncompete laws in 24 states — plus D.C. In some states (such as Illinois, Oregon, and Nevada), there were even multiple changes to the law over the last few years.

To keep track of it all, we’ve prepared a map as a visual supplement to our Changing Trade Secrets | Noncompete Laws page.
Nevada too has modified its noncompete law. Effective October 1, 2021, among other things, noncompetes cannot be used for hourly workers and employers will be at risk of paying attorney’s fees for violating certain aspects of the law.
So far this year, there have been 65 noncompete bills pending in 25 states — excluding the two pending federal noncompete bills, D.C.’s new law to ban most noncompetes, and any proposed bills that are circulating, but have not yet been filed. Five bills have died — leaving the current tally at 59 noncompete bills still pending in 21 states. Today’s post covers the three bills pending in Oregon.
So far this year, there have been 65 noncompete bills pending in 25 states — excluding the two pending federal noncompete bills, D.C.’s new law to ban most noncompetes, and any proposed bills that are circulating, but have not yet been filed. Five bills have died — leaving the current tally at 59 noncompete bills still pending in 21 states. Today’s post covers the three bills pending in New York, including New York’s late-breaking proposal to ban virtually all noncompetes.