Supreme Court Decision in Trump v. CASA Does Not Affect Ryan Court’s Universal Injunction of the FTC Noncompete Rule

At a Glance

• The CASA decision let stand the Ryan decision and similar federal district court opinions that have vacated federal regulations in reliance on the authority vested in federal district courts under the APA.
• Whether the APA allows a district court like the Ryan court to issue orders that are the functional equivalent of a universal injunction remains a hotly debated topic as the concurring opinions in CASA demonstrate.
• For now, Ryan remains on appeal before the U.S. Court of Appeals for the Fifth Circuit, and a current stay of the appeal expires in early July. It remains to be seen whether the FTC will withdraw its appeal following expiration of the stay.
• Although the CASA decision leaves Ryan intact because of its reliance on the APA, litigation in which district courts have entered a nationwide or universal injunction enjoining other employment-related laws and executive orders will likely face a different fate.

On June 27, 2025, the U.S. Supreme Court issued its decision in Trump v. CASA, Inc., No. 24A884, holding that district courts generally do not have the authority to issue nationwide, universal injunctions. For employers, a logical question is: What impact does the CASA decision have on the current status of the Federal Trade Commission's (FTC) final rule banning the use of most noncompete agreements (Noncompete Rule), which rule was set aside in August 2024 by the U.S. District Court for the Northern District of Texas in Ryan LLC v. Fed. Trade Commission, 3:24-cv-00986?

The short answer is that the CASA decision does not change the current status of the nationwide impact of the Ryan court’s August 2024 decision.

First, a refresher on the Ryan decision: In that case, on motions for summary judgment, the Ryan court held that the FTC exceeded its statutory authority in promulgating the Noncompete Rule, and further held that the Noncompete Rule was unenforceable because it was arbitrary and capricious. In determining the proper remedy, the Ryan court relied on the Administrative Procedure Act (APA), which vests authority in federal reviewing courts to “hold unlawful and set aside agency actions” that exceed statutory authority or are arbitrary and capricious. 5 U.S.C. § 706.The Ryan court then determined that its decision must have nationwide effect because the APA provision requiring the setting aside of unlawful agency actions does not contemplate party-specific relief and is not party-restricted.

The majority opinion in CASA instructs at footnote 10 that “[n]othing we say today resolves the distinct question whether the …[APA]… authorizes federal courts to vacate federal agency action.” Further, in a concurring opinion, Justice Kavanaugh wrote that district courts may still be able to issue orders in APA cases that are the “functional equivalent of a universal injunction” by setting aside or declining to set aside a rule. As such, the CASA decision let stand the Ryan decision and similar federal district court opinions that have vacated federal regulations in reliance on the authority vested in federal district courts under the APA.

Whether the APA allows a district court like the Ryan court to issue orders that are the functional equivalent of a universal injunction remains a hotly debated topic as the concurring opinions in CASA demonstrate. Those concurring opinions suggest that different Supreme Court Justices may answer the question very differently.

For now, Ryan remains on appeal before the U.S. Court of Appeals for the Fifth Circuit. Notably, that appeal was brought by the FTC in early January 2025, while the FTC was still led by a majority of Democratic-appointed commissioners. Since that time, a Republican-appointed commissioner, who voted against promulgation of the noncompete ban and who was the most vocal opponent of the Noncompete Rule, has been appointed chairman of the FTC, and the agency now has a majority of Republican-appointed commissioners.

In early March 2025, the FTC moved to stay its appeal of the Ryan decision because it was “reconsidering whether it is in the public interest to continue defending the rule.” The Fifth Circuit granted the stay until mid-July 2025, and all opponents of the Noncompete Rule must wait to see whether the FTC will withdraw the appeal and abandon that rule, once and for all.

Lastly, we note that, although the CASA decision leaves Ryan intact because of its reliance on the APA, litigation in which district courts have entered a nationwide or universal injunction enjoining other employment-related laws and executive orders will likely face a different fate.