This seems incredibly important. I know non-compete rules personally held me back at a previous tech job. I'm interested to see how this hits finance firms – I know people who were forced to take a year off between jobs (although they were compensated the whole time). Always thought that would be a pretty sweet deal.
> I know non-compete rules personally held me back at a previous tech job. Yeah. Remember this when you go to vote in November. Elections matter.
FTC announces rule banning noncompetes
261–270 of 530 posts
Re: FTC announces rule banning noncompetes
#262This seems incredibly important. I know non-compete rules personally held me back at a previous tech job. I'm interested to see how this hits finance firms – I know people who were forced to take a year off between jobs (although they were compensated the whole time). Always thought that would be a pretty sweet deal.
I was denied a job I was well qualified for because, (paraphrased, besides the quoted part): Our CEO and your CEO have a "gentleman's agreement" not to hire people that work at eachother's company. I have no idea why the recruiter was willing to put this in writing, and thankfully, I was able to find other work instead. I know it's not a non-compete, but there are other ways that companies can illegally form cartels…
Re: FTC announces rule banning noncompetes
#263Earlier quoted context omitted.
> I've always thought of that as representing a stifling of innovation. The short lifetime of patents and the requirement that you publish detailed information about the invention significantly mitigates this. If they were measuring innovation by the number of copyrights filed, then I might agree with you.
In theory maybe, but in practice it seems like the opposite. The current growth of the 3D printer market is in part directly tied to the lapsing of several key patents in the area. Further, most patents may contain key details, but they also intentionally contain as much broad information as to create a massive exclusionary zone, not to mention burying any legitimately useful information.
Re: FTC announces rule banning noncompetes
#264Earlier quoted context omitted.
"short lifetime" is relative. Had Apple been granted a patent on the idea of a smartphone the same year they released the iPhone, that patent would only expire in three years. There are some industries where due to slow-moving markets the 20 year patent period is still sensible, but for most sectors we would be better off with a 5 or 10 year patent period to account for the increased speed of innovation.
Apple did not invent the smart phone. The invented several features that make them useful (even their version one lacked apps), but others made smart phones before them. What Apple really did was make them useful by eliminating several of the things that made them annoying not not useful before.
Also, the point counts even if Apple just patented enough to block comparable phones.
The point: For the smartphone market, 20 years would be a very long effective time for any foundational or gatekeeping patents.
Re: FTC announces rule banning noncompetes
#265Earlier quoted context omitted.
Generally federal law will preempt state law. See the Court's decisions regarding California's attempt to ban arbitration agreements in employment contracts. Now, that doesn't mean the Supreme Court won't come up with their own hot take, but at some point appeals and district courts are just going to say no when they send a case back. What is the Supreme Court going to do? Federal judges can only be removed by impeac…
The odds of the conservative activism SCOTUS siding with employees and COTUS (bought off by corporate lobbyists) passing a worker-friendly prohibition on noncompetes are both zero. OTOH, it's not outside the realm of possibility that COTUS might pass a federal law superseding laws in California, Colorado, Illinois, Oregon, Nevada, Washington state, and Washington DC to roll back states rights favoring workers. Simila…
Re: FTC announces rule banning noncompetes
#266Full text of the ruling here: https://www.ftc.gov/system/files/ftc_gov/pdf/noncompete-rule... It's not surprising after thinking about it for a minute, but it did startle me to read that the FTC measures innovation by the number of patents issued. > In addition, the final rule is expected to help drive innovation, leading to an estimated average increase of 17,000 to 29,000 more patents each year for the next 10 year…
Sadly, over my long career as a tech startup entrepreneur, my experience has been that your assumption is correct the vast majority of the time. Now when I teach or mentor young tech entrepreneurs I'm often explaining why they probably don't want to prioritize filing patents as part of their startup strategy. While there are certain exceptions, especially in pharma, biotech, materials science or medical fields, the years it takes for a patent to become enforceable and then the upfront cost + further years required to actually get a judgement, make patents largely ineffective in most startup contexts. There's also substantial uncertainty as to whether a startup can get the patent granted at all. After that, there's the challenge of getting it granted in a form which remains defensible and can't be easily worked around. Many people don't realize patent examiners can refuse to grant a patent unless the applicant narrows the claims.
Conversely, as a tech startup these days you do need to worry about patents potentially being used against you. The majority of tech patent cases are giant vs giant fighting over turf, a large incumbent trying to kneecap an emerging startup competitor (usually filing suit to make the startup unattractive to investors for a year and never intending to actually go to court) or patent troll vs everyone. Personally, I had both a giant trying to stop my startup's Series A funding and several patent trolls. Despite having no actual merit, the giant's suit did freeze our Series A and we nearly died. After seven months we'd demonstrated we could survive without a Series A so they dropped the suit (of course) but by then they'd cost us more than half our cash in just defending an obviously sham claim. As one investor told me, "Yes, it's clearly a bullshit claim but it will still cost serious money and a lot of founder attention over the next 18 months to get it thrown out and that, unfortunately, tips this deal over our risk threshold." And responding to the constant patent trolls just burns up startup founder attention and scarce cash in nuisance legal fees.
Despite the old-school trope of "garage inventor patents invention, makes fortune", frankly, from the perspective of fostering typical tech startups, you'd probably prefer a world where there were no patents outside of pharma, medical, bio, etc.
Re: FTC announces rule banning noncompetes
#267Earlier quoted context omitted.
> completely abandoned its duty to pass laws That's the duty of the legislature? To make more rules?
Pass, repeal, and revise laws, yes. That's literally what the word "legislator" means.
Re: FTC announces rule banning noncompetes
#268Earlier quoted context omitted.
> FTC doesn't really have the ability to do this, since contract law is part of state law The federal government can absolutely regulate both employment and contract law. (Merger agreements are contracts. The FTC was established to block bad mergers.) Whether the FTC can do this is untested. But that’s more a Chevron issue than a federal powers one.
Generally federal law will preempt state law. See the Court's decisions regarding California's attempt to ban arbitration agreements in employment contracts. Now, that doesn't mean the Supreme Court won't come up with their own hot take, but at some point appeals and district courts are just going to say no when they send a case back. What is the Supreme Court going to do? Federal judges can only be removed by impeac…
Re: FTC announces rule banning noncompetes
#269Full text of the ruling here: https://www.ftc.gov/system/files/ftc_gov/pdf/noncompete-rule... It's not surprising after thinking about it for a minute, but it did startle me to read that the FTC measures innovation by the number of patents issued. > In addition, the final rule is expected to help drive innovation, leading to an estimated average increase of 17,000 to 29,000 more patents each year for the next 10 year…
> leading to an estimated average increase of 17,000 to 29,000 more patents each year Insane to me that they use this as a measure of innovation, when almost by definition it is the antithesis of innovation.
Re: FTC announces rule banning noncompetes
#270Earlier quoted context omitted.
> I've always thought of that as representing a stifling of innovation. The short lifetime of patents and the requirement that you publish detailed information about the invention significantly mitigates this. If they were measuring innovation by the number of copyrights filed, then I might agree with you.
In theory? Yes. In practice? No. For a lot of industries 20 years is an awfully long time to the point of complete irrelevance - and that "detailed information" is often vague enough to be unusable. Combine that with an overly-broad range of patent-able things and an overworked USPTO granting clearly invalid patents, and in practice (at least in the tech/software world) it's doing more harm than good. Patents are no…
I’d argue the same applies to all patents; the world would be better off without them in general.