On July 23, 2024, a federal judge in Pennsylvania declined to grant a temporary injunction against the Federal Trade Commission’s (FTC) forthcoming ban on employment noncompete agreements. District Judge Kelley Brisbon Hodge ruled that the FTC acted within its regulatory authority in issuing the ban. The court held that the FTC has the statutory power to establish both procedural and substantive rules to prevent unfair competition practices, rejecting the Plaintiff’s contention that such authority was limited to procedural rules only.

The ruling contrasts with a separate case in Texas, where another judge has preliminarily blocked the FTC’s rule. The differing outcomes suggest potential appellate challenges ahead, highlighting the uncertainty over the rule’s implementation set to take effect on September 4, 2024.