Federal judge in Texas overturns FTC ban on noncompete agreements

A federal judge in Texas has blocked a new rule from the Federal Trade Commission that would have made it easier for employees to quit a job and work for a competitor.

In a ruling Tuesday, U.S. District Judge Ada Brown granted a motion for summary judgement filed by the U.S. Chamber of Commerce and other plaintiffs, and rejected the FTC's own petition for a judgement in its favor.

In reaching his decision to overturn the ban, Brown concluded that that the FTC "exceeded its statutory authority" in making the rule, which the judge called "arbitrary and capricious." The judge also concluded that the rule would cause irreparable harm.