A Texas federal court Aug. 20 ruled set aside the Federal Trade Commission’s Non-Compete Clause Final Rule. U.S. District Judge Ada Brown held the FTC lacked the authority to enact the rule, which would ban, as an unfair method of competition, contractual terms that prohibit workers from pursuing certain employment after their contract with an employer ends. The court also held that the rule “is arbitrary and capricious because it is unreasonably overbroad without a reasonable explanation.” The FTC rule was set to take effect Sept. 4.

“The AHA welcomes Judge Brown’s decision setting aside the FTC’s non-compete rule nationwide,” said Chad Golder, AHA’s general counsel and secretary. “As the AHA explained in both its comment letter and amicus brief, the rule was a breathtaking assertion of regulatory power by three unelected Commissioners, made worse by the fact that the Commissioners did not attempt to understand the disruptive impact it would have on hospitals, health systems, and the patients they serve. We are pleased that Judge Brown vindicated what the AHA predicted when this unlawful regulation was first released — the ‘only saving grace is that this rule will likely be short-lived, with courts almost certain to stop it before it can do damage to hospitals’ ability to care for their patients and communities.’”

Related News Articles

Headline
The AHA Sept. 29 asked the Trump administration to provide exemptions for health care personnel from the proclamation issued Sept. 19 announcing changes to the…
Headline
The AHA urged the Department of Homeland Security today to maintain “duration of status” as an authorized period of stay for the nearly 17,000 physicians…
Headline
The AHA Sept. 24 expressed support for the Medical Student Education Authorization Act (H.R. 5428), legislation introduced in the House Sept. 17 that would…
Headline
An AHA blog published Sept. 16 highlights programs and practices by Boston Medical Center leaders and staff that support residents’ mental health, emotional…
Headline
The AHA’s American Organization for Nursing Leadership will host its virtual Nurse Manager Institute on Oct. 30, Nov. 6 and Nov. 13. The event is designed for…
Headline
The Department of Homeland Security today released a proposed rule to amend the process for selecting among prospective applicants — known as registrants — for…