Navigating Non-Competes: Understanding the New FTC Ruling and its Implications

About the Episode

The Federal Trade Commission (FTC) has issued a new ruling (as of May 2024) regarding the enforceability of non-compete agreements. This ruling will impact every business, regardless of industry, so attorney Darshan Kulkarni joins M&A Talk to discuss the legal and economic implications of this controversial decision. He highlights how employers and attorneys can handle this situation, discusses the potential effects on employees and the legal hurdles still to come, and offers advice for business owners and sellers. 

“This [non-compete ruling] fundamentally goes to the question of workers’ rights, but it also goes to a business’s right to exist and protect its own interests.”

Darshan Kulkarni

What You’ll Learn

• Enforceability: Insights into the situation since the FTC ruling is facing significant legal challenges and its long-term impact remains uncertain.
• Usability: Discussion about how non-compete clauses are commonly overused but have valid applications, particularly in M&A transactions, and reasonable restrictions may be enforceable.
• Legal Counsel: Business owners should promptly address employment agreements with legal counsel to understand compliance obligations and alternative protections.
• Implications: Thoughts on the future ramifications of this ruling in an overview of the potential legal and economic impact on business owners and employees.

Topics Covered

Want More? Related Resources: 

• M&A Non-Compete Agreement | A Complete Guide
• Alternatives to Non-Competes with Employees
• “State Noncompete Law Tracker, Economic Innovation Group,” Map showing non-compete laws by state in the United States, June 25, 2024
• “Federal Register – Non-Compete Clause Rule,” National Archives document with a summary of the FTC non-compete ruling, May 7, 2024
• “Comparative Perspectives on Non-Compete Clauses in the United States, United Kingdom, and Singapore,” Moynihan, Nadia; American Bar Association, September 14, 2023
• “FTC Announces Rule Banning Noncompetes,” Federal Trade Commission announcement, April 23, 2024

Meet Our Guest

Darshan Kulkarni

Regulatory and Compliance Attorney for the Life Sciences, Kulkarni Law Firm | Philadelphia Area, USA

Darshan Kulkarni is the Principal Attorney at the Kulkarni Law Firm and focuses on helping with the regulatory and compliance needs of FDA-regulated companies and their service providers, including drug, device, and biopharmaceutical companies, advertising agencies, and even other law firms. Dr. Kulkarni has a doctorate in pharmacy, a master’s in quality assurance/regulatory affairs, and a juris doctor, among other degrees and certificates.

LinkedIn: https://www.linkedin.com/in/darshankulkarni/