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Navigating the New Non-Compete Ban: Staying Informed and Consulting Your Attorney

Staying informed about legal changes is crucial for chiropractors, and the recent Federal Trade Commission (FTC) ban on non-compete agreements has implications worth understanding. 

The FTC's ban primarily applies to employer/employee agreements, excluding non-compete agreements in business sales. Meaning, chiropractors can still include non-compete agreements when buying and selling practices.

Non-compete agreements in business sales are allowed under the FTC's final rule because these agreements protect buyers from competition by sellers, preserving the value of the acquired business.

This exception from the FTC ban ensures that the buying doctor still has the essential protection a non-compete provides in a practice acquisition: 

“A non-compete agreement within a business sale is an agreement between a buyer and a seller where the seller agrees not to compete directly or indirectly with the buyer's newly acquired business. Essentially, the non-compete agreement protects a buyer from having to compete against the person (aka the seller) who knows the business in question the best.”

The law is slated to come into effect September 2024, but many lawsuits have been filed challenging the rule, which are expected to delay the effective date.

Implications for Chiropractors:

Understanding the implications of the FTC's ban on non-compete agreements is crucial for chiropractors. While the ban primarily affects employer/employee agreements, non-competes in business sales remain permissible. It is important to stay informed, consult with your attorney, and adapt to navigate this new landscape successfully. Your attorney will be able to provide you with the most accurate and up-to-date legal advice tailored to your specific situation.

Given opposition and potential legal challenges, the full impact of this ruling on employment non-competes for chiropractors may take years to materialize.

Stay informed, consult with your attorney, and adapt to navigate this new landscape successfully. Your attorney is your best resource for legal advice and guidance in light of the FTC's ban on non-compete agreements.

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