A Texas federal judge on Wednesday blocked the Federal Trade Commission’s implementation of its rule banning employers from imposing noncompete agreements on their workers, stating the regulation exceeded the agency’s statutory authority.
“Plainly read, the court concludes the FTC has some authority to promulgate rules to preclude unfair methods of competition,” wrote U.S. District Judge Ada Brown of the Northern District of Texas. “However, after reviewing the text, structure, and history of the act, the court concludes the FTC lacks the authority to create substantive rules through this method.”
