A federal judge in Pennsylvania denied a request to delay the rule, siding with the agency and diverging from another court’s decision this month.The New York Times reports that a federal judge in Pennsylvania has denied a request to delay the Federal Trade Commission’s ban on noncompete agreements. This decision diverges from another court’s ruling earlier this month, which found the agency’s move to be legally questionable.

The ruling clears the way for the FTC’s ban, which is set to take effect on September 4th. The ban will prohibit almost all noncompete agreements, which prevent employees from switching jobs within the same industry. These agreements affect approximately one in five American workers.

Several business groups had filed a lawsuit to block the ban, arguing that it would limit their ability to protect trade secrets and confidential information. One of these groups, ATS Tree Services, claimed that it used noncompetes to provide specialized training to its employees and prevent them from using that training to benefit a competitor.

However, Judge Kelley Brisbon Hodge ruled that ATS had not proven that it would suffer irreparable harm from the ban. She denied the company’s motion for a preliminary injunction, stating that the lawsuit was unlikely to succeed in the long run.

According to Douglas Farrar, a spokesman for the FTC, Judge Hodge’s decision fully supports the agency’s authority to ban noncompete clauses. These clauses harm competition by restricting workers’ freedom and mobility, and ultimately hinder economic growth.

Josh Robbins, a lawyer representing ATS, expressed disappointment with the court’s decision and stated that the firm will continue to fight against what they see as a power grab by the FTC. It is unclear at this time if the firm intends to appeal the ruling.

In conclusion, a federal judge in Pennsylvania has denied a request to delay the FTC’s ban on noncompete agreements, siding with the agency and diverging from another court’s decision. The ban is set to take effect on September 4th and will affect approximately one in five American workers. 

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