The 7th Circuit Court of Appeals remanded a district court's dismissal of an antitrust case that could have implications for noncompete agreements, according to a Sept. 8 JDSupra article from law firm Shearman & Sterling.
Here are five things to know:
1. The court ruled that the district court had not "sufficiently analyzed whether or not the per se rule should apply," in the case, which challenged no-hire and nonsolicitation clauses in McDonald's franchise agreements, according to the report.
2. The decision could indicate that courts may be wary to dismiss no-hire and nonsolicitation cases like this at an early stage, according to the report.
3. The Justice Department and FTC have been aggressively prosecuting employee noncompete agreements, the report said.
4. The court's decision reflects the high level of scrutiny in recent years and is another reason employers should be cautious about using no-hire or nonsolicitation clauses.
5. The decision "serves as a reminder that no-hire and non-solicitation clauses continue to be subject to significant litigation — both civil and criminal," the report said.