Judge Ada E. Brown decided that the FTC exceeded its statutory authority regarding noncompete agreements, stating that the rule is arbitrary and causes irreparable harm.
Victoria Graham expressed disappointment with the ruling, indicating the FTC will consider an appeal and continue to address noncompetes on a case-by-case basis.
The FTC aimed to increase workers' economic freedom and innovation through the noncompete ban, following President Biden's executive order urging the agency to take action.
This ruling differs from a previous decision in Pennsylvania, which affirmed the FTC's authority to ban noncompete clauses.
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