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Federal Trade Commission (FTC)
Texas Judge Blocks FTC’s Impending Ban on Non-Competes
A Federal Judge from Texas has issued a preliminary order against the FTC’s ban on non-compete agreements. Judge Brown ruled in favor of Ryan LLC, a tax service firm out of Dallas that utilizes non-compete agreements for its employees. Ryan LLC argued that the FTC was overstepping its legal authority by banning non-competes.
The FTC originally proposed a rule banning most non-compete agreements in January 2023. The final rule was issued on April 23, 2024, with a 3-2 vote. They ruled that non-compete clauses are “unfair methods of competition” under Section 5 of the FTC Act and therefore should be banned with few exceptions for existing non-compete clauses. This ban was scheduled to come into effect September 4, 2024. The full rule can be found here.
Ryan LLC sued to block the rule, and on July 3rd, Judge Brown decided to postpone the date that the non-compete ban would come into effect with the final ruling expected on August 30. The court has tipped its hand in its decision, stating that “The court concludes the commission has exceeded its statutory authority in promulgating the non-compete rule, and thus plaintiffs are likely to succeed on the merits.”
As of now, employers should follow the results of the August 30 ruling. Despite it appearing that the court will rule in favor of Ryan LLC, it is possible that it will decline to issue a nationwide injunction in which companies that utilize non-compete agreements may find themselves at risk of lawsuit, should they fail to comply.
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Consumer Financial Protection Bureau (CFPB)
CFPB Updates Small Business Lending Filing Instructions Guide
The CFPB issued the 2025 Small Business Lending Filing Instructions Guide, which updates the compliance dates used in the filing instructions to correspond with the new compliance dates for the rule. The 2025 updates include updating:
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The applicable filing period for this guide to reflect the updated Tier 1 compliance dates of July 18, 2025, through December 31, 2025, (as discussed in the Interim Final Rule).
The CFPB has also updated other resources to reflect the extended compliance dates.
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