In April, the Federal Trade Commission (FTC) voted to ban noncompete agreements for almost all U.S. workers, effective September 4, 2024. The ban would affect an estimated 30 million workers, who are currently under agreements preventing them from joining competing firms or launching one of their own. The ban would nullify existing noncompete agreements for most employees and prevent new such agreements in the future.

A federal court in Texas has temporarily enjoined the FTC ban from taking effect in the case of Ryan, LLC, a Dallas-based tax services firm. In this case, Ryan, LLC, accused the FTC of overstepping its statutory authority by declaring all noncompetes unfair and anticompetitive. It argued that the ban would inflict serious and irreparable damage to its business by putting its confidential information at risk and enabling competitors to poach its employees, whose valuable knowledge and extensive training would go out the door.