This week, the FTC extended the comment period for its proposed rule banning harmful noncompete agreements through April 19. As part of a trend in challenging this practice, the FTC struck down noncompetes that harmed low-wage security guard workers. The FTC also announced that it was sending nearly $2.4 million to consumers who were misled by a stock trading website. These stories and more after the jump.
Monday, March 6, 2023
Bureau of Consumer Protection: Consumer Refunds
- In March 2022, RagingBull.com, an online stock trading site, and its owners agreed to pay the FTC $2.425 million after the site used unsupported earnings claims to persuade consumers to sign up for services in hard-to-cancel subscription plans. Almost a year later, the FTC is sending payments totaling nearly $2.4 million to consumers who paid subscription fees to use the stock trading service. The FTC has already sent thousands of Paypal payments to affected consumers. Recipients should accept payment within 30 days.
Public Comment Period Extended for Proposed Rule Banning Noncompete Clauses
- In a 4-0 vote on Monday, the FTC extended the public comment period for its proposed rule to ban employers from imposing noncompete agreements. Comments on the proposed new rule are now being accepted through April 19, 2023. The accompanying Federal Register Notice offers guidance on submitting comments. Commissioner Wilson issued a brief concurring statement. To read about this blog’s coverage of the proposed rule, click here.
Bureau of Competition: Unwinding of Merger
- On March 3, 2023, Altria Group, Inc. relinquished its entire ownership interest in Juul Labs, Inc. Additionally, Altria Group and Juul Labs terminated their 2018 Relationship Agreement and Services Agreement. Because there is nothing more to challenge, respondents filed a motion to take official notice and to dismiss the litigation as moot, or in the alternative, to stay the litigation. To read about the development of this case, click here and here.
Wednesday, March 8, 2023
Bureau of Competition: Unfair Methods of Competition
- On Wednesday, the FTC prohibited two Michigan-based security companies from imposing or enforcing harmful noncompete agreements. The security companies Prudential Security, Inc. and Prudential Command Inc. and their owners allegedly exploited their bargaining power by requiring their employees to sign agreements not to work for a competing business within 100 miles for two years after leaving these companies. The FTC alleged that these security companies enforced their noncompetes by suing their employees and competing businesses. The security guards were paid minimum wage. This is part of the FTC’s recent trend of banning harmful noncompetes.
Thursday, March 9, 2023
FTC Open Commission Meeting March 16
- The FTC announced a tentative agenda for its Open Commission Meeting on Thursday, March 16, 2023. The meeting is scheduled to begin at 11 a.m. ET and will be held virtually. Members of the public must register to attend live or submit questions in advance by Tuesday, March 14 at 8 p.m. ET. The Commission will consider whether to issue 6(b) Orders to several social media and video streaming platforms. Particular attention will be paid to the companies’ ad review practices, including what measures they have taken to detect, prevent, and reduce deceptive advertising. The Commission will also consider whether to issue 6(b) Orders to five business credit reporting agencies. The Commission will focus on how the agencies collect and report data about small businesses as well as marketing of their business credit reporting products.
Friday, March 10, 2023
Comment on Franchise Request for Information
- The FTC is seeking public comment on franchise agreements and franchisor business practices to determine how franchisors may exert control over franchisees and their workers. The FTC is particularly interested in exploring franchisors’ disclosure of aspects and terms of the franchise relationship. The FTC seeks feedback on several issues such as the unequal bargaining power in franchise relationships and franchisors’ control over wages and working conditions. The FTC welcomes comments for 60 days at Regulations.gov.
- The FTC also seeks comment on whether the proposed rule banning harmful noncompetes should apply between franchisors and franchisees. These comments should be submitted through April 19, 2023.