Early Court Loss for FTC Noncompete Ban Signals States in Charge

A federal court decision partially blocking the Federal Trade Commission’s worker noncompete ban indicates regulation will remain with the states, which have met recent resistance to barring the contracts, even from Democratic governors.

The FTC’s April rule to ban nearly all these contracts, framing them as harmful to labor competition, is a notable foray by the federal government into regulating noncompetes.

But in a July 3 decision, Judge Ada Brown in the US District Court for the Northern District of Texas put the FTC ban on hold until she makes a final ruling on whether the agency overstepped its ...