AIPLA Comments on Federal Trade Commission Non-Compete Clause

Arlington, VA. April 21, 2023 - The American Intellectual Property Law Association (AIPLA) submitted comments to the Federal Trade Commission in response to their published notice on Non-Compete Clause Rulemaking, 88 FR 3482, on January 19, 2023. The proposed rule would effectively ban the use of non-competes, with few exceptions.

The comments offer AIPLA's perspective on the potential impacts of the proposed rule on protecting trade secrets and, consequently, on the businesses, economy, and national security of the United States. The comments suggest that a proposed rule effectively forbidding throughout the U.S. the use of a common and, in most states, accepted method of protecting trade secrets raises substantial concerns for intellectual property protection. In particular, the AIPLA expressed its concern about the impact the inevitable, unintended consequences of the rule will have on American businesses, economy, and national security which depend heavily on trade secrets. Furthermore, the comments note that often non-compete agreements are the most effective tool to protect sensitive and valuable trade secrets.

Therefore, AIPLA urges the Commission to withdraw the proposed rule and consult and coordinate with other agencies, as called for by the Executive Order on Promoting Competition in the American Economy (July 9, 2021).

To view the complete comments, please download the comment letter posted to the right of this page.