March 20 (Reuters) - H&R Block ( HRB ) sued the U.S.

Federal Trade Commission on Wednesday, seeking an order that

could upend the agency's case accusing the tax giant of

misleading consumers about the scope of its free tax-filing

services.

The lawsuit in Kansas City, Missouri federal court claims

the FTC's use of internal administrative law judges to hear

cases violates the U.S. Constitution.

The FTC last month accused H&R Block ( HRB ) of deceiving customers

with broad marketing for "free" online tax filing services that

really only apply to simple returns. The agency also said H&R

Block ( HRB ) had unfairly deleted consumers' tax data.

H&R Block ( HRB ) has denied the FTC's claims. A hearing before an

administrative judge is set for Oct. 23.

Wednesday's lawsuit cites the power of U.S. presidents

enshrined in the Constitution to remove "inferior officers." It

says the FTC's internal judges are improperly insulated from

that authority, and that the agency must abandon their use.

"The FTC could still vindicate its law-enforcement interests

by conducting the adjudication itself," the lawsuit said.

Kansas City, Missouri-based H&R Block ( HRB ) did not immediately

respond to a request for comment, and neither did a

representative for the FTC.

The FTC's administrative law judges preside over hearings

and take evidence, and they issue findings that can be appealed

to the full commission. The agency then hears arguments and

issues a final order. Those decisions can be appealed to a U.S.

court.

Federal agencies' use of administrative law judges have been

contested in other cases.

The U.S. Supreme Court in November heard a challenge to the

U.S. Securities and Exchange Commission's similar proceedings

using administrative law judges.

The court's ruling, expected by the end of June, could have

broad consequences for such in-house agency tribunals.

The case is H&R Block ( HRB ) et al v. Himes et al, U.S. District

Court for the Western District of Missouri, No.

4:24-cv-00198-HFS.