Ryan’s lawsuit halts Federal Trade Commission (FTC) ban on non-compete agreements

Federal Judge Issues Stay and Preliminary Injunction Against FTC in Response to Tax Services Firm’s Challenge

DALLAS, July 3, 2024–(BUSINESS WIRE)–Today, a federal court ruled in favor of Ryan (a leading global provider of tax services and software) and against the U.S. Federal Trade Commission (FTC), halting the FTC’s ban on non-compete agreements that is set to go into effect this fall. U.S. District Court Judge Ada Brown of the Northern District of Texas issued a stay and preliminary injunction against the FTC in response to Ryan’s lawsuit challenging the new rules. The judge’s decision halts implementation of the rules, which were originally scheduled to go into effect on September 4. The judge said she intends to issue a final decision on the merits of the case by August 30, 2024.

Ryan’s lawsuit, filed April 23, challenges the FTC’s authority to issue such rules, which impose an extraordinary burden on business owners seeking to protect their intellectual property and retain top talent in the professional services industry. Chairman and CEO Ryan G. Brint Ryan describes the FTC’s ban as “one of the most outrageous examples of government abuse of power I’ve seen.”

In her ruling, Judge Brown stated that “the Court finds that the Commission exceeded its statutory authority in promulgating the non-compete rule and, therefore, Plaintiffs are likely to succeed on the merits.” She emphasized that “the role of an administrative agency is to do what Congress directs, not to do what the agency believes it should do.”

“The court’s decision is an important step toward invalidating a rule that burdens not only Ryan, but his clients and a host of employers and employees across America,” said John Smith, Ryan’s general counsel and general counsel. “We are grateful that the U.S. Chamber of Commerce and the Texas Association of Business joined our case shortly after it was filed. We appreciate the many organizations — which together represent a large portion of the American economy — that filed briefs in support of Ryan’s position.”

Smith added, “Ryan will seek a final substantive decision that overturns the FTC’s unlawful ban. In the same spirit, the U.S. Supreme Court in recent days has reaffirmed constitutional and statutory limits to deterring government abuses of power. This week, Americans celebrate our nation’s Declaration of Independence from an abusive royal crown. Non-compete agreements predate the American Revolution, and our lawsuit seeks to preserve strong freedom of contract for future generations of enterprising Americans.”

About Ryan

Ryan, an award-winning global tax services and software provider, is the largest firm in the world dedicated exclusively to business tax. With global headquarters in Dallas, Texas, the firm provides an integrated suite of federal, state, local and international tax services on a multi-jurisdictional 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 his commitment to world-class customer service. With a dynamic myRyan A work environment that 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 more than 30,000 clients in over 80 countries, including many of the world’s most well-known Global 5000 companies. For more information about Ryan, visit ryan.com.

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Communication

Allie Bandemer
Public Relations Specialist
Ryan
331.251.1050
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