“Hooray, my noncompete is no longer in effect. The FTC just voided it.”
Not so fast.
Everybody knows about the FTC’s 3-2 decision to ban noncompete agreements. There are thousands of news stories on the internet about it, and no need to regurgitate them. I would like to caution everyone who’s bound by a noncompete agreement not to be too euphoric, at least not yet.
For one thing, the rule doesn’t take effect for 120 days. Until then, noncompete agreements are just as enforceable in Texas as they’ve ever been.
Also, multiple lawsuits will contest the FTC’s authority to void tens of millions of contracts between employers and employees. One such lawsuit was filed in federal court in Dallas on the same day the FTC took its vote. Ultimately, whether the FTC had the authority to do what it did will be decided by the United States Supreme Court, and it could take years to get a decision.
Until that decision comes, caution is warranted.