MIAMI NON-COMPETE AGREEMENT: FTC ALLOWS NONCOMPETITION AGREEMENTS

In September 2025, the Federal Trade Commission (FTC) formally withdrew its appeal in the pivotal case titled Ryan LLC v. FTC and Properties of the Villages v. FTC, which struck down the FTC’s 2024 attempt to generally ban non-compete agreements and similar restrictive covenants across the board. In Ryan, you may recall that the United States District Court for the Northern District of Texas issued a nationwide injunction prohibiting the FTC from enforcing its general nationwide ban against restrictive covenants. Ryan LLC v. FTC, 2024 WL 3879954 (N.D. Tex., Aug. 20, 2024) (The “Court hereby holds unlawful and sets aside the Rule… The Rule shall not be enforced or otherwise take effect on its effective date of September 4, 2024, or thereafter.”). The FTC’s appeal withdrawal signaled the end of its attempt to broadly ban restrictive covenants nationwide. The Miami business litigation attorneys of the Mavrick Law Firm represent businesses and their owners in breach of contract litigation and related claims of fraud, non-compete agreement litigation, trade secret litigation, trademark infringement litigation, employment litigation, and other legal disputes in federal and state courts and in arbitration.

The FTC shifted its restrictive covenant strategy several months after withdrawing its Ryan appeal by moving away from a sweeping national ban and, instead, focusing on a case-by-case enforcement approach. In a workshop hosted by the FTC in late January 2026, the FTC confirmed it will not pursue a national rule ban against non-competition agreements but will bring targeted enforcement actions against agreements the FTC deems overly broad or unjustified. The FTC will focus on non-competition agreements associated with lower-wage earners or non-specialized roles because it views them as anticompetitive, legally suspect, lacking clear business justification. Therefore, business owners should review their existing non-compete agreements to ensure they are narrowly tailored, reasonable in scope and duration, and based on a legitimate business interest because the FTC will focus enforcement actions on overboard agreements.

The final nail in the coffin for the FTC’s 2024 rule generally banning non-compete agreements came in February 2026 when the FTC published a rule officially removing 16 CFR Part 910 from the Code of Federal Regulation. 16 CFR Part 910 was the FTC’s rule banning most non-competition and non-solicitation agreements nationwide that went into effect September 4, 2024. Removing this rule from the Code of Federal Regulation nullifies it enforceability and prohibits litigants from using 16 CFR Part 910 to avoid restrictive covenants.

Lawsuits involving restrictive covenants will therefore turn on the types of issues previously discussed at length in this blog. Is the agreement in writing, does the enforcer possess a legitimate business justifying enforcement of the restrictive covenant, did the enforcer breach the restrictive covenant first, can the enforcee overcome the presumption of irreparable harm, and is the restriction reasonable under the circumstances? Defendants facing restrictive covenant enforcement actions will obviously have more difficulty avoiding enforcement of restrictive covenants without the FTC’s ban while business owners will have an easier time enforcing their agreements with employees and others. Whether you are the enforcer or the enforcee, it is important to consult legal counsel about your restrictive covenant agreement to determine whether it is enforceable and to what extent it can be enforced.

The Miami business litigation lawyers of the Mavrick Law Firm also represent clients in Fort Lauderdale, Boca Raton, and Palm Beach. This article does not serve as a substitute for legal advice tailored to a particular situation.