6 ms·

FTC Wins Round Two in Its Non-Compete Ban Defense

143 points by lynndotpy 2y ago

candiddevmike 2y ago
[flagged]
- alexpetralia 2y ago
  [flagged]
  - Spivak 2y ago
    We can't have the only functional branch of government making laws they were specifically authorized to write. If you want non-competes banned you have to go directly through deadlock-as-a-service.
    - jncfhnb 2y ago
      We can though. That was the whole point of executive agencies. To not require deadlock as a service.
      - Spivak 2y ago
        It's why I'm frustrated as the originalist/textualist direction of the courts where it's clear they want to massively reduce the ability of congress to delegate their authority. Because federal agencies didn't come into existence out of nowherere, they were created to solve specific problems with congress -- notably the speed of rulemaking and the lack of specific industry expertise. I genuinely don't know what they expect to happen when doing away with it and replacing it with nothing. Letting the agencies go about their business and if they do something congress really doesn't like they have the ability to intervene is good system of agility and accountability. Especially because states, red and blue alike, unburdened by the constitution in the same way also use this model.
        lenerdenator 2y ago
        > I genuinely don't know what they expect to happen when doing away with it and replacing it with nothing. A golden age of value transfer to shareholders, unencumbered by communist concepts like "environmental protection" and "workplace safety". Or at least that's what will happen for a while, until something happens, like some guy who's lost everything to his kid getting (and dying from) cancer - caused by drinking polluted water - realizing there's no real legal recourse anymore and deciding to take matters into his own hands. But that's a simple possibility to the c-suite, not a certainty, and even if it were a certainty, it's not known if it's scheduled in the next fiscal quarter. So dump the chemicals in the waterway and get back to work. Literally every concern can be pushed out into the unknown future, while every benefit can be quantified and added to the earnings call as a talking point. EDIT: You can downvote this all you want, but all of these agencies, rules, etc. are a part of a system meant to prevent and adjudicate issues that exist in society. If you remove that system, humans will come up with their own.
        rangestransform 2y ago
        If you want speed of policymaking, you can become more authoritarian a la china or have a more elitist policymaking system like some portion of european countries (see: France banning short haul flights, London congestion charge and ULEZ). I view the election of Donald trump in 2016 as a wholesale rejection of elitism in American policymaking rather than any true desire for conservative values.
        HumblyTossed 2y ago
        > I view the election of Donald trump in 2016 as a wholesale rejection of elitism in American policymaking rather than any true desire for conservative values. Then he truly did con the American people.
        Spivak 2y ago
        * The short haul flight ban is great, and widely supported. You don't need those flights anyway because the rail network is cheaper and better. Plus the ban has so many exceptions it's likely to not actually impede you when actually needed, most people wish it was stronger. * The ban was passed by the Assemblée Nationale which is their congress. So I'm not sure what your point is, it wasn't unilateral.
- throw10920 2y ago
  [flagged]
  - HumblyTossed 2y ago
    [flagged]
    - wernercd 2y ago
      Fact has backing evidence. AKA: Citation Needed.
  - dangus 2y ago
    [flagged]
    - ethbr1 2y ago
      That judges were picked off an organization's list does not mean that organization controls those judges. GP comment was low-effort. If they'd wanted to say something more substantive, they could have written more.
      - HumblyTossed 2y ago
        [flagged]
      - dangus 2y ago
        Is there any binding law that prevents any organization from bribing the Supreme Court into making favorable rulings? Shouldn’t the default assumption be that recommended judges are friendly to their influence? The plain fact that the Supreme Court has record low level trust as an institution makes any important ruling that reaches their court something of an exercise in anxiety. I think that’s worthy of discussion and I don’t think the original comment was inflammatory. Just my own opinion.
        coldpie 2y ago
- pm90 2y ago
  [flagged]
your-username 2y ago
[flagged]
cdolan 2y ago
I am surprised that the Chevron case and this have not overlapped I thought the outcome of Chevron being overturned (I.e. “3-letter-agencies can no longer unilaterally make laws”) would have come up here as well, since the FTC is part of the Executive Branch (Not trying to comment on the underlying case. Don’t care to argue for or against NCs)
- jkaplowitz 2y ago
  The overturning of Chevron doesn’t prevent executive branch agencies from unilaterally making law (in the form of legally binding regulations) through the Administrative Procedure Act process if they stay within one of Congress’s statutory grants of authority. “Unilaterally” is not the same thing as “immune to judicial review” or “entitled to automatic judicial deference”. What Chevron previously said is that, if the scope of the statutory grant of authority was ambiguous and the agency’s interpretation of that ambiguity was reasonable, then the court must defer to the agency’s interpretation. That requirement is now gone. Without the Chevron rule, courts will still uphold a regulation that was clearly statutorily authorized under the same conditions as when Chevron was good law, and they will still overturn regulations that were clearly not authorized by statute just as they did under Chevron. For ambiguous cases, the court now independently reaches their own judicial finding of law, just as they would if deciding whether a statute passed by Congress is authorized by the Constitution. Of course, courts still can and will give due consideration to the opinion of the agency and their subject-matter experts, just as they would consider the briefs and evidence from all parties to any dispute. Only the automatic deference which Chevron sometimes required is gone. Regarding the FTC non-compete rule, neither court ruling relied on Chevron. One court found the relevant statutory authority to be sufficient through their own independent judicial analysis rather than through Chevron deference, and one found it to be insufficient (a finding which never involved Chevron deference).
  - sqeaky 2y ago
    But isn't the overturning of Chevron itself an example of the Court ignoring the authorizations of Congress? Congress delegated the authority to agencies to make regulations.
billy_bitchtits 2y ago
[flagged]
- jkaplowitz 2y ago
  Chevron being overturned doesn’t in any way prevent a court from deciding that the statute authorizes a regulation. It just prevents the agency from saying “you have to defer to our reasonable interpretation.” But yeah, the conservative Supreme Court indeed may very much not like the Pennsylvania court’s interpretation that the necessary statutory authority does exist.
  - ubertaco 2y ago
    I mean, the problem with the current supreme court is that their decision-making process -- as demonstrated in the Trump immunity case (where the ruling was in direct contradiction to established law) -- is not a question of what the law says, but what the conservatives on the court (or their deep-pocketed bribers) want.
    - poikroequ 2y ago
      Precisely. When there's a will, there's a way. They'll find some way to interpret the laws and the constitution that fits their agenda.
      - ethbr1 2y ago
        Which part of the presidential majority opinion did you take issue with? I found it grappled with some weighty issues and made a defensible position, that I expect will be refined when/if the case returns to the Supreme Court.
        banana_feather 2y ago
        The framers understood the concept of immunity, and in at least one instance explicitly granted it in the constitution. They did not mention anything about immunity for the chief executive. The line of argument about "bold and decisive action" is complete bullshit. The OLC has told previous presidents, in writing, that they are not immune from prosecution and that knowledge did not fatally impede their judgment. The president also has a fleet of lawyers at their disposal, and the DoJ conceded in oral argument that if the president obtained an opinion from the attorney general that a given act was indeed legal, the president would have immunity for that act via estoppel by entrapment. The opinion does almost nothing to establish what is and is not an official act for the purposes of this new immunity. This has become a hallmark of the Roberts court; making a power grab by writing an opinion that rests on laughably malleable language ("major questions", "deeply rooted in tradition", "official acts"). You can just wait until your friends appeal the cases that didn't go your way, grant cert because of course you get to pick your own dock, and laugh all the way to the bank. The cherry on top is the part prohibiting even the introduction of evidence relating to official acts. If the president openly takes a cartoon burlap sack of money in exchange for a pardon, the standard set out in the opinion is that you cannot introduce any evidence pertaining to the grant of the pardon, because the pardon power is a core constitutional authority of the executive. The entire opinion is ahistorical, poorly reasoned, and profoundly unwise.
crvdgc 2y ago
And billionaires already started lobbying for Harris to drop Khan, the FTC chair behind this Non-Compete Ban: https://truthout.org/articles/sanders-rebukes-billionaire-effort-to-get-harris-to-dump-antitrust-champion-khan/ https://truthout.org/articles/sanders-rebukes-billionaire-ef...
- abnercoimbre 2y ago
  > with one donor telling The New York Times that Harris is open to the idea. That would be a grave mistake. I know people who are primarily voting to preserve this FTC.
  - 1vuio0pswjnm7 2y ago
    "I know people who are primarily voting to preserve this FTC." That would also be a grave mistake. Unfortunately, it is not possible to "vote to preserve this FTC" anymore. That possibility ended when Biden was pushed out. Biden is a major reason, arguably the only reason, Khan and Kanter are able to do what they are doing. Harris is pro-Silicon Valley, as in she has not taken any meaningful _action_ against it (cf. rhetoric). Biden is definitely not pro-Silicon Valley. He made the right appointments and nominations and "ordered" agencies to take necessary action; indeed they have.
- jauntywundrkind 2y ago
  I've seen three perfectly reasonable seeming submissions about this get almost immediately flagged. Some serious dark forest shit, even for HN. It sucks that there is so little accountability for those who deny access to information here. There's very little that's given me hope for government like seeing an FTC that's doing something, thats protecting consumers & making sure there's some competition. It's been so very long since Reagan so effectively stomped out anti-trust regulation, and my gut feeling is that much of the disenfranchisement today has roots in the seemingly ever growing imbalances Thomas Piketty so thoroughly detailed. The FTC is a key agency to keeping civilization bought in on our social contract.
  - 2y ago
KoftaBob 2y ago
I just can't understand how anyone can, with a straight face, argue that non-compete clauses should be allowed in a free market. The free market works best when competition isn't stifled, and the name of the clause is literally a "non-compete".
- HumblyTossed 2y ago
  [flagged]
- linuxftw 2y ago
  I feel like they should be enforceable, but only under the same compensation as the labor was in the first place. Make companies pay for the privilege.
  - Volundr 2y ago
    I didn't end up taking it, but I was offered a job with a company based out of Illinois that did this. Upon termination (voluntary or otherwise) the company had the choice to enforce the noncompete clause or not. If they chose to enforce it I'd have gotten paid my salary for the duration. A lawyer explained to me that this was how they were working around Illinois restrictions on non-compete clauses. Normally the terms they were applying wouldn't be enforceable, but by continuing the salary they were essentially extending the employment agreement.
  - theluketaylor 2y ago
    To be in the realm of fair non-compete compensation needs to be total comp and not just base salary. In the US while not working you need to cover healthcare costs and many roles have a significant portion of comp from percentages of sales, bonuses, and other incentives. Just a base salary payment during a 6-12 month furlough would be a big pay cut for many. There also likely needs to be some additional compensation for lost time in the market when skills are atrophying or new experience isn't being gained. Non-competes have a place, but there needs to be tons of rules around their use, like only being available for specialized and other high paid roles. Something like 3x-4x median salary to be a position eligible for a company to even propose a non-compete.
deleted 2y ago
[deleted]

143 points by lynndotpy 2y ago

candiddevmike 2y ago

[flagged]

alexpetralia 2y ago
[flagged]
- Spivak 2y ago
  We can't have the only functional branch of government making laws they were specifically authorized to write. If you want non-competes banned you have to go directly through deadlock-as-a-service.
  - jncfhnb 2y ago
    We can though. That was the whole point of executive agencies. To not require deadlock as a service.
    - Spivak 2y ago
      It's why I'm frustrated as the originalist/textualist direction of the courts where it's clear they want to massively reduce the ability of congress to delegate their authority. Because federal agencies didn't come into existence out of nowherere, they were created to solve specific problems with congress -- notably the speed of rulemaking and the lack of specific industry expertise. I genuinely don't know what they expect to happen when doing away with it and replacing it with nothing. Letting the agencies go about their business and if they do something congress really doesn't like they have the ability to intervene is good system of agility and accountability. Especially because states, red and blue alike, unburdened by the constitution in the same way also use this model.
      - lenerdenator 2y ago
        > I genuinely don't know what they expect to happen when doing away with it and replacing it with nothing. A golden age of value transfer to shareholders, unencumbered by communist concepts like "environmental protection" and "workplace safety". Or at least that's what will happen for a while, until something happens, like some guy who's lost everything to his kid getting (and dying from) cancer - caused by drinking polluted water - realizing there's no real legal recourse anymore and deciding to take matters into his own hands. But that's a simple possibility to the c-suite, not a certainty, and even if it were a certainty, it's not known if it's scheduled in the next fiscal quarter. So dump the chemicals in the waterway and get back to work. Literally every concern can be pushed out into the unknown future, while every benefit can be quantified and added to the earnings call as a talking point. EDIT: You can downvote this all you want, but all of these agencies, rules, etc. are a part of a system meant to prevent and adjudicate issues that exist in society. If you remove that system, humans will come up with their own.
      - rangestransform 2y ago
        If you want speed of policymaking, you can become more authoritarian a la china or have a more elitist policymaking system like some portion of european countries (see: France banning short haul flights, London congestion charge and ULEZ). I view the election of Donald trump in 2016 as a wholesale rejection of elitism in American policymaking rather than any true desire for conservative values.
        HumblyTossed 2y ago
        > I view the election of Donald trump in 2016 as a wholesale rejection of elitism in American policymaking rather than any true desire for conservative values. Then he truly did con the American people.
        Spivak 2y ago
        * The short haul flight ban is great, and widely supported. You don't need those flights anyway because the rail network is cheaper and better. Plus the ban has so many exceptions it's likely to not actually impede you when actually needed, most people wish it was stronger. * The ban was passed by the Assemblée Nationale which is their congress. So I'm not sure what your point is, it wasn't unilateral.
throw10920 2y ago
[flagged]
- HumblyTossed 2y ago
  [flagged]
  - wernercd 2y ago
    Fact has backing evidence. AKA: Citation Needed.
- dangus 2y ago
  [flagged]
  - ethbr1 2y ago
    That judges were picked off an organization's list does not mean that organization controls those judges. GP comment was low-effort. If they'd wanted to say something more substantive, they could have written more.
    - HumblyTossed 2y ago
      [flagged]
    - dangus 2y ago
      Is there any binding law that prevents any organization from bribing the Supreme Court into making favorable rulings? Shouldn’t the default assumption be that recommended judges are friendly to their influence? The plain fact that the Supreme Court has record low level trust as an institution makes any important ruling that reaches their court something of an exercise in anxiety. I think that’s worthy of discussion and I don’t think the original comment was inflammatory. Just my own opinion.
      - coldpie 2y ago
pm90 2y ago
[flagged]

your-username 2y ago

[flagged]

cdolan 2y ago

I am surprised that the Chevron case and this have not overlapped I thought the outcome of Chevron being overturned (I.e. “3-letter-agencies can no longer unilaterally make laws”) would have come up here as well, since the FTC is part of the Executive Branch (Not trying to comment on the underlying case. Don’t care to argue for or against NCs)

jkaplowitz 2y ago
The overturning of Chevron doesn’t prevent executive branch agencies from unilaterally making law (in the form of legally binding regulations) through the Administrative Procedure Act process if they stay within one of Congress’s statutory grants of authority. “Unilaterally” is not the same thing as “immune to judicial review” or “entitled to automatic judicial deference”. What Chevron previously said is that, if the scope of the statutory grant of authority was ambiguous and the agency’s interpretation of that ambiguity was reasonable, then the court must defer to the agency’s interpretation. That requirement is now gone. Without the Chevron rule, courts will still uphold a regulation that was clearly statutorily authorized under the same conditions as when Chevron was good law, and they will still overturn regulations that were clearly not authorized by statute just as they did under Chevron. For ambiguous cases, the court now independently reaches their own judicial finding of law, just as they would if deciding whether a statute passed by Congress is authorized by the Constitution. Of course, courts still can and will give due consideration to the opinion of the agency and their subject-matter experts, just as they would consider the briefs and evidence from all parties to any dispute. Only the automatic deference which Chevron sometimes required is gone. Regarding the FTC non-compete rule, neither court ruling relied on Chevron. One court found the relevant statutory authority to be sufficient through their own independent judicial analysis rather than through Chevron deference, and one found it to be insufficient (a finding which never involved Chevron deference).
- sqeaky 2y ago
  But isn't the overturning of Chevron itself an example of the Court ignoring the authorizations of Congress? Congress delegated the authority to agencies to make regulations.

billy_bitchtits 2y ago

[flagged]

jkaplowitz 2y ago
Chevron being overturned doesn’t in any way prevent a court from deciding that the statute authorizes a regulation. It just prevents the agency from saying “you have to defer to our reasonable interpretation.” But yeah, the conservative Supreme Court indeed may very much not like the Pennsylvania court’s interpretation that the necessary statutory authority does exist.
- ubertaco 2y ago
  I mean, the problem with the current supreme court is that their decision-making process -- as demonstrated in the Trump immunity case (where the ruling was in direct contradiction to established law) -- is not a question of what the law says, but what the conservatives on the court (or their deep-pocketed bribers) want.
  - poikroequ 2y ago
    Precisely. When there's a will, there's a way. They'll find some way to interpret the laws and the constitution that fits their agenda.
    - ethbr1 2y ago
      Which part of the presidential majority opinion did you take issue with? I found it grappled with some weighty issues and made a defensible position, that I expect will be refined when/if the case returns to the Supreme Court.
      - banana_feather 2y ago
        The framers understood the concept of immunity, and in at least one instance explicitly granted it in the constitution. They did not mention anything about immunity for the chief executive. The line of argument about "bold and decisive action" is complete bullshit. The OLC has told previous presidents, in writing, that they are not immune from prosecution and that knowledge did not fatally impede their judgment. The president also has a fleet of lawyers at their disposal, and the DoJ conceded in oral argument that if the president obtained an opinion from the attorney general that a given act was indeed legal, the president would have immunity for that act via estoppel by entrapment. The opinion does almost nothing to establish what is and is not an official act for the purposes of this new immunity. This has become a hallmark of the Roberts court; making a power grab by writing an opinion that rests on laughably malleable language ("major questions", "deeply rooted in tradition", "official acts"). You can just wait until your friends appeal the cases that didn't go your way, grant cert because of course you get to pick your own dock, and laugh all the way to the bank. The cherry on top is the part prohibiting even the introduction of evidence relating to official acts. If the president openly takes a cartoon burlap sack of money in exchange for a pardon, the standard set out in the opinion is that you cannot introduce any evidence pertaining to the grant of the pardon, because the pardon power is a core constitutional authority of the executive. The entire opinion is ahistorical, poorly reasoned, and profoundly unwise.

crvdgc 2y ago

And billionaires already started lobbying for Harris to drop Khan, the FTC chair behind this Non-Compete Ban: https://truthout.org/articles/sanders-rebukes-billionaire-effort-to-get-harris-to-dump-antitrust-champion-khan/ https://truthout.org/articles/sanders-rebukes-billionaire-ef...

abnercoimbre 2y ago
> with one donor telling The New York Times that Harris is open to the idea. That would be a grave mistake. I know people who are primarily voting to preserve this FTC.
- 1vuio0pswjnm7 2y ago
  "I know people who are primarily voting to preserve this FTC." That would also be a grave mistake. Unfortunately, it is not possible to "vote to preserve this FTC" anymore. That possibility ended when Biden was pushed out. Biden is a major reason, arguably the only reason, Khan and Kanter are able to do what they are doing. Harris is pro-Silicon Valley, as in she has not taken any meaningful _action_ against it (cf. rhetoric). Biden is definitely not pro-Silicon Valley. He made the right appointments and nominations and "ordered" agencies to take necessary action; indeed they have.
jauntywundrkind 2y ago
I've seen three perfectly reasonable seeming submissions about this get almost immediately flagged. Some serious dark forest shit, even for HN. It sucks that there is so little accountability for those who deny access to information here. There's very little that's given me hope for government like seeing an FTC that's doing something, thats protecting consumers & making sure there's some competition. It's been so very long since Reagan so effectively stomped out anti-trust regulation, and my gut feeling is that much of the disenfranchisement today has roots in the seemingly ever growing imbalances Thomas Piketty so thoroughly detailed. The FTC is a key agency to keeping civilization bought in on our social contract.
- 2y ago

KoftaBob 2y ago

I just can't understand how anyone can, with a straight face, argue that non-compete clauses should be allowed in a free market. The free market works best when competition isn't stifled, and the name of the clause is literally a "non-compete".

HumblyTossed 2y ago
[flagged]
linuxftw 2y ago
I feel like they should be enforceable, but only under the same compensation as the labor was in the first place. Make companies pay for the privilege.
- Volundr 2y ago
  I didn't end up taking it, but I was offered a job with a company based out of Illinois that did this. Upon termination (voluntary or otherwise) the company had the choice to enforce the noncompete clause or not. If they chose to enforce it I'd have gotten paid my salary for the duration. A lawyer explained to me that this was how they were working around Illinois restrictions on non-compete clauses. Normally the terms they were applying wouldn't be enforceable, but by continuing the salary they were essentially extending the employment agreement.
- theluketaylor 2y ago
  To be in the realm of fair non-compete compensation needs to be total comp and not just base salary. In the US while not working you need to cover healthcare costs and many roles have a significant portion of comp from percentages of sales, bonuses, and other incentives. Just a base salary payment during a 6-12 month furlough would be a big pay cut for many. There also likely needs to be some additional compensation for lost time in the market when skills are atrophying or new experience isn't being gained. Non-competes have a place, but there needs to be tons of rules around their use, like only being available for specialized and other high paid roles. Something like 3x-4x median salary to be a position eligible for a company to even propose a non-compete.

deleted 2y ago

[deleted]