Good morning. The Federal Trade Commission on Tuesday banned employers from using noncompete contracts to prevent most workers from joining rival firms, achieving a policy goal that is popular with labor but faces an imminent court challenge from business groups.

• The vote: The measure, approved by the agency’s Democratic majority, marks the first time in more than 50 years that FTC officials have issued a regulation to mandate an economywide change in how companies compete. The commission has historically operated like a law enforcement agency, investigating and suing individual companies over practices or deals deemed to violate the law.
   
• The decision: The rule prohibits companies from enforcing existing noncompete agreements on anyone other than senior executives. It also bans employers from imposing new noncompete contracts on senior executives in the future.
   
• Why the FTC has pursued this: Noncompete clauses violate a 110-year-old law that prohibits unfair methods of competition, the FTC says. The restrictions hamper competition for labor, the agency says, and result in lower pay and benefits for workers. The practice has grown more prevalent in the U.S. economy and now affects nearly one in five American workers. 

Prosecutors allege scheme to supply Venezuelan oil company with aircraft parts.

Federal prosecutors unsealed a years-old indictment charging 10 people with operating a scheme to evade U.S. restrictions on Venezuela’s state-controlled oil company Petróleos de Venezuela through the illegal supply of aircraft parts.

One arrest so far. The indictment, unsealed Monday, follows the arrest of one of the defendants, George Clemente Semerene Quintero, on Friday at the Miami International Airport, according to the U.S. Attorney’s Office for the Southern District of Florida.

The allegations. The indictment alleges that Semerene and others collaborated in a scheme to procure aircraft parts, including turbofan engines from the Charlotte, N.C.-based Honeywell, to service PdVSA’s aircraft fleet in Venezuela.

• Two crypto industry groups sued the Securities and Exchange Commission on Tuesday to challenge a new rule that broadened the definition of what the regulator considers to be a “dealer” of securities.
   
• Starbucks asked the Supreme Court on Tuesday to limit a government labor board that has been eager to support union drives.
   
• Major artificial-intelligence companies including OpenAI, Meta Platforms and Google agreed on Tuesday to incorporate new safety measures to protect children from exploitation and plug several holes in their current defenses.
   
• Elon Musk criticized an order by Australian authorities to remove a video of the stabbing of a religious leader.
   
• Cleveland-Cliffs said President Biden would use the federal government’s regulatory process to block Japan’s Nippon Steel from purchasing U.S. Steel.

World primed for more balanced growth as U.S. cools, peers pick up pace.

Activity in the U.S. private sector slowed in April amid signs of a pickup in other leading economies, a sign that global growth is set to be more broadly balanced this year.

Surveys of purchasing managers released Tuesday pointed to a surprise cooling of activity in the U.S. as the second quarter began, while eurozone activity gained for the second straight month, helped by Germany’s return to growth for the first time in nearly a year.

• The U.S. military commander in the Indo-Pacific said he didn’t believe the economic growth figures reported by China and described the country’s economy as failing.
   
• The European Central Bank will take account of the Federal Reserve’s progress in lowering inflation when it decides the pace of cuts to its key interest rate after a first move in June, its vice president said in an interview published Tuesday.
   
• Fighting between Israel and Hamas intensified in northern Gaza, the first battleground in the war, where 200 days into the conflict territory is still heavily contested and Israel says thousands of militants remain.

• Tesla’s first-quarter profit plunged to its lowest level since 2021 as pressure mounted on Chief Executive Officer Elon Musk to better articulate his vision for the electric-car maker’s future.
   
• Tabloid publisher David Pecker told a Manhattan jury that nearly a decade ago, he reached an unusual deal with then-candidate Donald Trump and his lawyer Michael Cohen: The trio pledged to bury stories that could be politically harmful to Trump.
   
• Columbia University President Minouche Shafik is facing mounting discontent as the school grapples with intense protests over the Israel-Hamas war, with the latest round prompting administrators to switch to hybrid classes for the remainder of the semester.
   
• A Moscow court rejected an appeal by Wall Street Journal reporter Evan Gershkovich against his detention, meaning the U.S. citizen, who has been awaiting trial for over a year, will remain behind bars until at least June 30.

Follow us on X at @WSJRisk. Follow Risk & Compliance editor David Smagalla @DSmagalla_DJ and reporters Mengqi Sun @_MengqiSun, Dylan Tokar @dgtokar and Richard Vanderford @VanderfordRich.

You can reach us by replying to any newsletter, or email David at david.smagalla@wsj.com.