The Federal Trade Commission unlawfully intruded on states’ regulatory power by issuing a near-total ban on worker noncompete agreements, a group of

GOP-Led States Say Biden FTC Overstepped With Noncompete Ban

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2025-01-25 20:00:05

The Federal Trade Commission unlawfully intruded on states’ regulatory power by issuing a near-total ban on worker noncompete agreements, a group of 17 Republican-led states argued in a new court filing.

Led by the Florida attorney general’s office, the states urged the US Court of Appeals for the Eleventh Circuit to affirm a Florida federal judge’s decision that the FTC lacked clear congressional authorization to implement the ban.

“States have regulated noncompete clauses and contract law since the founding,” the states said Wednesday. “The federal government, in contrast, has never done so. This dramatic change from state to federal regulation requires a clear statement from Congress that does not exist.”

The friend-of-the-court brief came in a case the FTC is defending against Properties of the Villages Inc., a real estate firm in The Villages, Fla., that challenged the rule. The agency is also appealing at the Fifth Circuit a Texas judge’s August decision that blocked the rule from going into effect.

A leadership shakeup inside the agency raises doubts about whether that fight will continue. Republican Andrew Ferguson, who became the agency’s chair upon President Donald Trump’s inauguration, voted against the rule while serving as a commissioner.