LITIGATION TRENDS 2025 | 49 T O C E M P E S G A N T I I P C A P R O W C S P O R T C O N T A C T I N T A P P P A T C C L S E C Paid Parental Leave. Several developments this year shaped the protections available to expectant parents. At the state level, on April 20, 2024, the Governor of New York signed into law a requirement for private employers to grant prenatal leave to pregnant employees. The law took effect on January 1, 2025. Similarly, in Massachusetts, employees falling under the sick time law now possess the right to take their paid sick days to address the employees’ own physical and mental health needs, and those of their spouses, if the employees or the employees’ spouses experience pregnancy loss or a failed assisted reproduction, adoption or surrogacy. Despite these state-level expansions of pregnancy-related rights, at the federal level, on June 20, 2024, the Eleventh Circuit narrowed the protections available under the FMLA. In Tanner v. Stryker Corp. of Michigan, 104 F.4th 1278, 1285 (11th Cir. 2024), the Eleventh Circuit held that the FMLA does not provide an expectant parent who is neither pregnant nor married to a pregnant spouse with pre-birth leave so that he may await the child’s birth away from work. Federal and State Legislative and Regulatory Developments in Restrictive Covenant Law FTC’s Proposed Ban on NonCompetes Enjoined In 2024, the FTC’s proposed rule seeking to ban most non-compete agreements nationwide garnered the most attention, particularly when the Northern District of Texas in Ryan LLC v. FTC, along with the Middle District of Florida in Properties of the Villages v. FTC, set aside the final rule on a nationwide basis. See Ryan LLC v. FTC, Case No. 3:24-cv-986 (N.D. Tex. Aug. 20, 2024); Properties of the Villages, Inc. v. FTC, Case No. 5:24-cv-316 (M.D. Fla. Aug. 15, 2024). Most recently, newly appointed FTC Chairman Andrew N. Ferguson stated that the FTC needed to decide whether it would continue its challenges to the decisions invalidating or enjoining the final rule. Accordingly, the status of how the FTC will proceed going forward remains a question mark. Nonetheless, the FTC’s proposed rule certainly brought to the forefront issues relating to restrictive covenant regulation and legislation which is certain to continue at the state level. Notable Judicial and Agency Developments In LKQ Corp. v. Rutledge, 2024 WL 5152746 (Del. Dec. 18, 2024), the Delaware Supreme Court noted that a “forfeiture-for-competition provision” is unlike a non-competition covenant, and thus is not subject to a reasonableness review. Extending an earlier decision by the court in Cantor Ainslie v. Cantor Fitzgerald, L.P., 2023 WL 106924 (Del. Ch. Jan. 4, 2023), the Court said that this provision can extend beyond withholding unpaid vested benefits, and can also include requiring the employee to return previously paid benefits. Employers should be aware, however, that this doctrine only applies when the employee voluntarily terminates their employment, and the court left open the possibility that a forfeiture for competition provision could be so extreme that it should be reviewed for reasonableness. Staying in Delaware, in Sunder Energy LLC v. Jackson, 2024 WL 5052887 (Del. Dec. 10, 2024), the Delaware Supreme Court held that the Chancery Court properly declined to blue pencil a noncompete agreement because there was no “equality of bargaining power” between the contracting parties. Sunder continues a trend among Delaware courts away from frequent use of the blue pencil. In the few months following Sunder, the Court of Chancery has declined to blue pencil non-compete agreements on several occasions, noting in one recent case that blue penciling “creates confusion, encourages employers to overreach, and encourages litigation by building a degree of uncertainty into every employment agreement.” Cleveland Integrity Servs., LLC v. Byers, 2025 WL 658369, at *12 (Del. Ch. Feb. 28, 2025). In North American Senior Benefits v. Wimmer, No. S23G1146 (Sept. 4, 2024), the Georgia Supreme Court held that employee non-solicitation Employment 48 | Weil, Gotshal & Manges LLP
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