Ryan Lawsuit Halts Federal Trade Commission (FTC) Ban on Non-Compete Agreements
03 July 2024 - 11:35PM
Business Wire
Federal Judge Issues a Stay and a Preliminary
Injunction Against the FTC in Response to Tax Services Firm’s
Challenge
Today, a federal court ruled for Ryan (a leading global tax
services and software provider) and against the U.S. Federal Trade
Commission (FTC), halting the FTC’s ban on non-compete agreements
set to take effect this fall. U.S. District Court Judge Ada Brown
of the Northern District of Texas issued a stay and a preliminary
injunction against the FTC in response to Ryan’s lawsuit, which
challenges the new rule. The judge’s decision halts implementation
of the rule, originally set to take effect on September 4. The
judge stated she intends to issue a final decision on the merits by
August 30, 2024.
Ryan’s lawsuit, filed on April 23, challenges the FTC’s
authority to issue such a rule, which imposes an extraordinary
burden on business owners seeking to protect their intellectual
property and to retain top talent within the professional services
industry. Ryan Chairman and CEO G. Brint Ryan describes the FTC ban
as “one of the most outrageous examples of government overreach
that I have seen.”
In her ruling, Judge Brown stated, “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.” She emphasized “the role of an administrative agency is to
do as told by Congress, not to do what the agency think[s] it
should do.”
“The court’s decision is an important step toward invalidating a
rule that burdens not only Ryan, but also Ryan’s clients, and
multitudes of employers and employees across America,” said John
Smith, Ryan Chief Legal Officer and General Counsel. “We’re
grateful that the U.S. Chamber of Commerce and Texas Association of
Business joined our case shortly after we filed it. We appreciate
the many organizations—which together represent a vast swath of the
American economy—that filed briefs supporting Ryan’s position.”
Smith added, “Ryan will pursue a final decision on the merits
that strikes down the FTC’s unlawful ban. In the same spirit, the
U.S. Supreme Court in recent days has reasserted constitutional and
statutory constraints to reverse overreach by the administrative
state. This week, Americans celebrate our nation’s Declaration of
Independence from an overreaching royal crown. Non-compete
agreements predate the American Revolution, and our lawsuit seeks
to preserve a robust freedom of contract for generations of
enterprising Americans to come.”
About Ryan
Ryan, an award-winning global tax services and software
provider, is the largest Firm in the world dedicated exclusively to
business taxes. With global headquarters in Dallas, Texas, the Firm
provides an integrated suite of federal, state, local, and
international tax services on a multijurisdictional basis,
including tax recovery, consulting, advocacy, compliance, and
technology services. Ryan is an 11-time recipient of the
International Service Excellence Award from the Customer Service
Institute of America (CSIA) for its commitment to world-class
client service. Empowered by the dynamic myRyan work environment,
which is widely recognized as the most innovative in the tax
services industry, Ryan’s multidisciplinary team of more than 4,800
professionals and associates serves over 30,000 clients in more
than 80 countries, including many of the world’s most prominent
Global 5000 companies. More information about Ryan can be found at
ryan.com.
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Allie Bandemer Public Relations Specialist Ryan 331.251.1050
allie.bandemer@ryan.com