Amicus (friend of the court) briefs have been steadily coming in the past few weeks in both the Ryan LLC v. FTC and ATS Tree Services v. FTC cases, where the FTC’s noncompete ban is being challenged. Below is a list of the amici with a summary of their main arguments:
-
Public Citizen and National Employment Law Project (NELP)
Public Citizen and NELP filed briefs in support of the FTC’s rule in both the Ryan LLC and ATS Tree Services LLC cases, arguing that both challengers were unlikely to succeed on the merits of their case. They argue that noncompetes are significantly harmful to low-income workers, are usually unilaterally imposed without meaningful consent, and reduce wages and job mobility which harms the job market. They also argue that the rule being retroactive is not problematic.
-
Administrative Law Scholars
Administrative Law Scholars is one of the five groups of law professors who submitted an amicus brief in support of the FTC rule. This group of professors argues that the FTC has a history of addressing noncompetes as being an unfair method of competition. They relatedly argue that the major questions doctrine and nondelegation doctrine do not prohibit the FTC from regulating in this area because the FTC is simply doing what it has done before.
-
Law Professors
Law Professors, the second group of law professors, focuses on the importance of employee mobility. They argue the rule will help with promoting competition and innovation in the marketplace and will lead to an increase in wages and enhance worker equality.
-
Legal Scholars
Legal Scholars, the third group of law professors, focuses on the case National Petroleum Refiners Association v. FTC, where the federal appellate court in the D.C. Circuit upheld the FTC’s rulemaking authority. They argue Congress has shown its intent to grant the FTC rulemaking authority by codifying the holding in National Petroleum Refiners Association.
-
35 Law, Business, and Economics Professors and Scholars
The fourth group of professors and scholars also focuses on the importance of labor mobility. They argue that the FTC rule is good for the economy as employee mobility will help with innovation, increase competition, and increase wages.
-
Professors William Araiza, Jeffrey Lubbers, and Peter M. Shane
The final group of professors argues the FTC has not overstepped in enacting the rule as the rule falls within its long-established authority meaning the major questions doctrine does not apply. Additionally, they argue the nondelegation doctrine does not apply as regulating unfair methods of competition is within the FTC’s authority.
-
Small Business Majority and Professor Evan Starr
Small Business Majority and Professor Evan Starr submitted amicus briefs in both cases stating their support for the FTC rule. They argue noncompetes are harmful to a healthy and thriving economy. They argue further that noncompetes hinder innovation and discourage workers from finding new jobs that might be more beneficial to them.
-
Texas Local Elected Officials
A group of Texas officials filed an amicus brief in which they argue that the FTC’s rule was appropriately considered. Their brief focuses on the harm they contend noncompetes have on communities and small businesses, as well as how they limit innovation and restrict wages.
-
Texas AFL-CIO
This organization filed an amicus brief backing the FTC rule. The purpose of Texas AFL-CIO’s brief seems to be to give examples and show how noncompetes have burdened their members in their respective jobs. The brief emphasizes the importance of the right to sell labor and the freedom to work.
-
S. Representative Matt Gaetz (R-FL)
Representative Gaetz also submitted a brief in support of the FTC rule. His brief focuses on the benefits he contends the final rule will have on the millions of American workers who are impacted by noncompetes. He additionally argues that the rule is “squarely within the Commission’s statutory rulemaking authority.”
-
American Academy of Emergency Medicine (AAEM)
The AAEM also supports the rule. In its brief it argues that the final rule benefits patient care and delaying the rule would be against the public interest. AAEM’s brief argues that getting rid of noncompetes will support innovation within the healthcare system and will allow for physician mobility which will in turn help with staffing shortages.
-
Community Legal Services (CLS)
In the ATS Tree Services case, Community Legal Services filed an amicus brief in support of the rule and in opposition to the relief sought by ATS. CLS argues that ATS has not established that its interests will suffer if the rule remains in effect and therefore its request for injunctive relief fails. Additionally, CLS argues that an injunction barring the rule from taking effect would cause great harm to low-wage workers in Pennsylvania.
On June 4, the FTC filed its response to ATS Tree Services’ motion to stay the rule. The FTC’s arguments mirror the arguments made in its response to Ryan LLC’s similar motion to stay the rule.
On June 12, Ryan LLC and the U.S. Chambers of Commerce filed a reply in support of Ryan’s motion to stay the rule and for preliminary injunction. Both reiterate their argument that the FTC is overstepping and does not have the authority to issue this rule. They additionally reiterate the irreparable harm the rule will have if it is allowed to take effect. ATS Tree Services will be filing its reply in support of its motion to stay in a few weeks.
The court in the Ryan LLC case has announced that it will not hold a hearing on the request for injunctive relief. The court’s ruling on the case is set for July 3.
Stay tuned for more updates, and please reach out if you have questions.
Marissa Cripe, a summer associate at BFV, contributed to this article.
Benjamin Fink is known for his work in noncompete, trade secret and competition-related disputes. A shareholder at Berman Fink Van Horn, Ben concentrates his practice in business and employment litigation.
Neal Weinrich knows noncompetes and trade secrets inside and out. A shareholder at Berman Fink Van Horn, Neal counsels clients in all industries on matters involving restrictive covenants, trade secrets and other competition-related issues.
