4 ms·

I haven't read the details (paywall), but my assumption here is that the objection is to the FTC making this rule without an act from Congress, not the general

by kelnos 2y ago

I haven't read the details (paywall), but my assumption here is that the objection is to the FTC making this rule without an act from Congress, not the general idea of banning non-competes. While the FTC theoretically has the authority to do this, of late there's been a conservative judicial push against the "regulatory state". Regardless, a federal judge need not consider the laws of any state when making a ruling on something like this. Edit: read via archive link. So yeah: > ... US District Judge Ada Brown in the Northern District of Texas wrote in the decision on Tuesday, concluding that the regulator “lacks statutory authority” to issue the rule. And: > Brown [...] was appointed by then-president Donald Trump So she's a conservative-leaning judge who's skeptical of the executive branch's regulatory powers. Not news.

HideousKojima 2y ago
>While the FTC theoretically has the authority to do this From which statute?
- drawkward 2y ago
  From the most cited supreme court precedent ever.
  - HideousKojima 2y ago
    >From the most cited supreme court precedent ever. I'm not sure what a mostly boring procedural case about standards for summary judgement has to do with the FTC and/or non-compete clauses: https://en.m.wikipedia.org/wiki/Anderson_v._Liberty_Lobby,_Inc https://en.m.wikipedia.org/wiki/Anderson_v._Liberty_Lobby,_I....
- ceejayoz 2y ago
  > Under this Act, the Commission is empowered, among other things, to (a) prevent unfair methods of competition, and unfair or deceptive acts or practices in or affecting commerce; (b) seek monetary redress and other relief for conduct injurious to consumers; (c) prescribe trade regulation rules defining with specificity acts or practices that are unfair or deceptive, and establishing requirements designed to prevent such acts or practices; (d) conduct investigations relating to the organization, business, practices, and management of entities engaged in commerce; and (e) make reports and legislative recommendations to Congress. https://en.wikipedia.org/wiki/Federal_Trade_Commission_Act_of_1914 https://en.wikipedia.org/wiki/Federal_Trade_Commission_Act_o... Non-competes are unfair methods of competition, unfair practices affecting commerce, etc.
  - HideousKojima 2y ago
    I'm not a lawyer, but section 5c of the Federal Trade Commission Act appears to give the courts overriding authority over any of the FTC's decisions.
    - ceejayoz 2y ago
      Virtually everything outside of a Constitutional amendment is judicially reviewable. The courts are expected to do a little more than go "nuh uh!", though. Section 5c states, in part: > The findings of the Commission as to the facts, if supported by evidence, shall be conclusive.
- deleted 2y ago
  [deleted]
FireBeyond 2y ago
And then she even said that even if the regulator did have statutory authority, she wasn't sufficiently convinced. Which is to the opposite side of the spectrum... "even if you have the authority, I can just say "I'm not convinced by the argument that you don't owe me, so I'll still block it"."
- zdragnar 2y ago
  There are plenty of cases where executive authority may not be enacted in an arbitrary manner. The government probably spent more time asserting that they had the authority to do so, than that doing so was necessary. Either way, this will likely end up in a different court, and at a higher level, and get decided again.
rayiner 2y ago
You’ve got it backward. It’s not surprising that a court found the FTC lacked the power to categorically ban contractual arrangements under state contract law. The relevant principles are ones most people learn in high school government class: federalism (employment contracts are a matter of state rather than federal law) and separation of powers (executive branch agencies enforce the law, they don’t make it). What would require a special explanation is if the court found the opposite. It’s really appalling how many supposedly educated lawyers would arrive at the wrong answer to something a bright 10th grader could figure out from first principles.
- amanaplanacanal 2y ago
  Not sure I understand your argument. Are you suggesting the federal government can’t, for instance, set a minimum wage?
  - rayiner 2y ago
    The Supreme Court case upholding the constitutionality of the federal minimum wage as being a proper exercise of Commerce Clause power, United States v. Darby, rests on very weak reasoning: https://www.oyez.org/cases/1940-1955/312us100 https://www.oyez.org/cases/1940-1955/312us100 (“The Court held that the purpose of the FLSA was to prevent states from using substandard labor practices to their own economic advantage by interstate commerce. Congress acted with proper authority in outlawing substandard labor conditions since they have a significant impact on interstate commerce.”). Similar to Wickard v. Filburn, it gives Congress power over purely intrastate activity based on a tenuous connection to interstate commerce. But there’s probably some version of both the minimum wage and the ban on non-compete agreements that’s constitutional under the Commerce Clause. For example, if they were limited to employers that do business in multiple states or if they purported to apply when employees moved to a different state where non-competes were unenforceable. The bigger problem is the separation of powers aspect. As you seem to recognize, banning non-competes seems like banning an unfair labor practice. That something that should be the subject of Congressional legislation, like the FLSA. Congress almost certainly didn’t intend to delegate to the FTC power over employment contracts, nor could it have given the FTC such an open-ended delegation of legislative authority.

by kelnos 2y ago

HideousKojima 2y ago

>While the FTC theoretically has the authority to do this From which statute?

drawkward 2y ago
From the most cited supreme court precedent ever.
- HideousKojima 2y ago
  >From the most cited supreme court precedent ever. I'm not sure what a mostly boring procedural case about standards for summary judgement has to do with the FTC and/or non-compete clauses: https://en.m.wikipedia.org/wiki/Anderson_v._Liberty_Lobby,_Inc https://en.m.wikipedia.org/wiki/Anderson_v._Liberty_Lobby,_I....
ceejayoz 2y ago
> Under this Act, the Commission is empowered, among other things, to (a) prevent unfair methods of competition, and unfair or deceptive acts or practices in or affecting commerce; (b) seek monetary redress and other relief for conduct injurious to consumers; (c) prescribe trade regulation rules defining with specificity acts or practices that are unfair or deceptive, and establishing requirements designed to prevent such acts or practices; (d) conduct investigations relating to the organization, business, practices, and management of entities engaged in commerce; and (e) make reports and legislative recommendations to Congress. https://en.wikipedia.org/wiki/Federal_Trade_Commission_Act_of_1914 https://en.wikipedia.org/wiki/Federal_Trade_Commission_Act_o... Non-competes are unfair methods of competition, unfair practices affecting commerce, etc.
- HideousKojima 2y ago
  I'm not a lawyer, but section 5c of the Federal Trade Commission Act appears to give the courts overriding authority over any of the FTC's decisions.
  - ceejayoz 2y ago
    Virtually everything outside of a Constitutional amendment is judicially reviewable. The courts are expected to do a little more than go "nuh uh!", though. Section 5c states, in part: > The findings of the Commission as to the facts, if supported by evidence, shall be conclusive.
deleted 2y ago
[deleted]

FireBeyond 2y ago

And then she even said that even if the regulator did have statutory authority, she wasn't sufficiently convinced. Which is to the opposite side of the spectrum... "even if you have the authority, I can just say "I'm not convinced by the argument that you don't owe me, so I'll still block it"."

zdragnar 2y ago
There are plenty of cases where executive authority may not be enacted in an arbitrary manner. The government probably spent more time asserting that they had the authority to do so, than that doing so was necessary. Either way, this will likely end up in a different court, and at a higher level, and get decided again.

rayiner 2y ago

You’ve got it backward. It’s not surprising that a court found the FTC lacked the power to categorically ban contractual arrangements under state contract law. The relevant principles are ones most people learn in high school government class: federalism (employment contracts are a matter of state rather than federal law) and separation of powers (executive branch agencies enforce the law, they don’t make it). What would require a special explanation is if the court found the opposite. It’s really appalling how many supposedly educated lawyers would arrive at the wrong answer to something a bright 10th grader could figure out from first principles.

amanaplanacanal 2y ago
Not sure I understand your argument. Are you suggesting the federal government can’t, for instance, set a minimum wage?
- rayiner 2y ago
  The Supreme Court case upholding the constitutionality of the federal minimum wage as being a proper exercise of Commerce Clause power, United States v. Darby, rests on very weak reasoning: https://www.oyez.org/cases/1940-1955/312us100 https://www.oyez.org/cases/1940-1955/312us100 (“The Court held that the purpose of the FLSA was to prevent states from using substandard labor practices to their own economic advantage by interstate commerce. Congress acted with proper authority in outlawing substandard labor conditions since they have a significant impact on interstate commerce.”). Similar to Wickard v. Filburn, it gives Congress power over purely intrastate activity based on a tenuous connection to interstate commerce. But there’s probably some version of both the minimum wage and the ban on non-compete agreements that’s constitutional under the Commerce Clause. For example, if they were limited to employers that do business in multiple states or if they purported to apply when employees moved to a different state where non-competes were unenforceable. The bigger problem is the separation of powers aspect. As you seem to recognize, banning non-competes seems like banning an unfair labor practice. That something that should be the subject of Congressional legislation, like the FLSA. Congress almost certainly didn’t intend to delegate to the FTC power over employment contracts, nor could it have given the FTC such an open-ended delegation of legislative authority.