On October 12, 2023, the Wisconsin legislature introduced Assembly Bill 481, which proposes the ban of employee non-compete agreements in the Badger State. Currently, employee non-compete agreements in Wisconsin are allowed if limited to a specified territory, a specified time, and only if the “restrictions imposed are reasonably necessary for the protection of the employer or principal.” Wis. Stat.

Continue Reading Wisconsin Legislature Proposes Joining Other States in Ban of Non-Compete Agreements

On January 1, 2022, the latest amendments to the Illinois Freedom to Work Act (“Act”) became effective. As we previously described, that Act sets forth various requirements governing restrictive covenant agreements in Illinois. Among other things, the Act codified the so-called Fifield Rule by defining adequate consideration for enforcement of a restrictive covenant to be either two years of

Continue Reading Questions Remain Regarding Adequate Consideration under Illinois’ Freedom to Work Act

For those interested in commenting on the FTC’s proposed rule banning nearly all non-competes, today, April 19, is your deadline to do so!

To date, approximately 25,000 comments have been submitted to the FTC, from individuals, corporations, and various industry groups and legal associations. That includes a comment from the U.S. Chamber of Commerce (as part of a coalition

Continue Reading Today’s the Day: Deadline to Submit Comments to the FTC

The FTC announced yesterday that it was extending the deadline to submit public comments on its proposed rule banning employment non-competes.

With the extension, the FTC will now be accepting comments on the proposed rule until April 19. Originally, the deadline for submitting comments was March 20.

Information on how to submit comments can be found in the Federal Register notice.Continue Reading FTC Extends Public Comment Deadline on Proposed Rule Banning Employment Non-Competes Until April 19th

On February 16, 2023, the FTC hosted a public forum for the purpose of examining the proposed rule banning non-compete agreements. The agenda included, among other things, opening remarks from Chair Kahn, an overview of the rulemaking process by the FTC’s general counsel, a panel discussion, and comments from the public. A recording of the forum is available here.

In her preliminary remarks, Chair Kahn claimed that the proposed rule would increase workers’ earnings significantly and non-competes are an unfair method of competition. She claimed that the FTC has deep expertise on non-competes based upon enforcement, analysis, and addressing public comments. During the explanatory session, FTC staff explained that the comment period ends March 20th and encouraged the submission of additional comments. Staff also explained the functional test in the proposed rule and indicated that the ban applies to any agreement that functionally operates as a non-compete, which could be an overly broad non-disclosure agreement or training repayment agreement. FTC staff stated that the proposed rule does not apply to “run of the mill non-disclosures.”Continue Reading FTC Holds Public Forum Examining Proposed Rule to Ban Noncompete Clauses and Business Organizations Sharply Criticize It

Earlier today, the Federal Trade Commission (“FTC”) published a proposed rule which would ban all non-compete agreements between employers and “workers” (broadly defined to include employees, independent contractors, interns, and others). If adopted, the proposed rule will bar both prospective and existing non-compete agreements. The FTC included an overview fact sheet describing the proposed rule.

The FTC is seeking public comment on the proposed rule, which is based on a preliminary finding that non-competes constitute an unfair method of competition and therefore violate Section 5 of the Federal Trade Commission Act. This proposed rule aligns with the FTC’s recent statement to attempt to reinvigorate Section 5 of the FTC Act, which bans unfair methods of competition.Continue Reading FTC Proposes Rule Banning Use of Non-Competes with Employees and Workers and Limiting Employer Protections Against Unfair Competition

federal non-compete ban legislationOn September 1, 2022, Representative Mike Garcia (CA-25) introduced H.R. 8755, titled The Restoring Workers’ Rights Act (the “RWRA”), which would effectively ban non-compete agreements for non-exempt (low-to-mid wage) employees nationwide. If enacted, the RWRA would follow similar legislation in states such as Illinois, Colorado, Washington, and others that have imposed statutory income minimums that must be met in order for employers to bind employees to post-employment restrictive covenants.
Continue Reading California Representative Mike Garcia Introduces Federal Bill Barring Non-Compete Agreements

trade secrets litigationIn June 2022, a federal judge sitting in the Southern District of New York issued an order denying defendants Lionbridge Technologies, Inc. (“Lionbridge”) and its parent company HIG Middle Market, LLC (“HIG”) attorneys’ fees and costs related to their assertion that plaintiff Transperfect Global, LLC (“Transperfect”) brought a misappropriation of trade secrets claim under the Defend Trade Secrets Act (“DTSA”) in bad faith. The 2019 lawsuit was filed roughly 15 months after completion of a bidding war for the sale of Transperfect in a Delaware court-supervised auction. One of the participants in the auction was HIG, which had acquired Lionbridge—a competitor of Transperfect—in February 2017. In its suit, Transperfect alleged that HIG engaged in “fake bidding” during the auction so that it could access trade secrets in the form of confidential pricing data and customer lists and improperly share them with Lionbridge to poach two of Transperfect’s biggest clients.
Continue Reading No Fees for Failure to Show “Bad Faith” in Prosecution of Trade Secrets Claim

Seyfarth Partners Robert Milligan, Erik Weibust, and Marcus Mintz, as well as senior associate Alex Meier will each be participating in the 2021 Annual Meeting of The Sedona Conference Working Group 12 (WG12) on Trade Secrets on December 13-14, 2021 in Phoenix, Arizona.

The mission of Working Group 12 is to develop consensus and nonpartisan principles for managing trade secret
Continue Reading Seyfarth Attorneys to Participate at 2021 Annual Meeting of The Sedona Conference Working Group 12 (WG12) on Trade Secrets