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Sept. 1 — The Financial Planning Coalition and the American Association for Justice are the only groups that will be permitted to file friend-of-the-court briefs in a lawsuit challenging the Department of Labor’s fiduciary rule, which regulates advice given to retirement savers ( Chamber of Commerce v. U.S. Dep’t of Labor , N.D. Tex., No. 3:16-cv-01476-M, 8/31/16 ).
Chief Judge Barbara M.G. Lynn of the U.S. District Court for the Northern District of Texas blocked six other groups from participating in the lawsuit, including the AARP, Public Citizen Inc. and the National Black Chamber of Commerce. The Financial Planning Coalition and the American Association for Justice filed briefs that stood out from the others, because they presented novel arguments and unique perspectives, Lynn said in her Aug. 31 order.
The Financial Planning Coalition represents nearly 80,000 financial professionals that operated under a fiduciary standard similar to the one proposed by the DOL since 2008, according to the group’s brief. Unlike the industry groups spearheading the lawsuit, the coalition supports the DOL fiduciary rule, saying that a “broadly applicable fiduciary standard represents a win-win for both industry and the public.”
Lynn deemed this brief valuable because it provided a “practical perspective different from that of the parties.”
The American Association for Justice, which represents trial lawyers and seeks to “safeguard victims’ rights,” argued in its brief that the DOL acted within its authority when it limited the ability of financial firms to ban investors from participating in class actions.
This brief was valuable because it addressed a “narrow legal issue” and didn’t repeat arguments made in other briefs, Lynn said.
The six briefs that Lynn rejected were filed by AARP, Public Citizen Inc., the Consumer Federation of America, the Public Investors Arbitration Bar Association, the National Black Chamber of Commerce and Better Markets Inc.
All of the proposed briefs, with the exception of that filed by the National Black Chamber of Commerce, supported the department’s fiduciary rule.
This lawsuit, which is a consolidation of three of the five actions currently challenging the DOL fiduciary rule, is set for a hearing Nov. 17.
Another fiduciary rule challenge went before a federal judge in Washington on Aug. 25. That judge is currently considering whether to issue a preliminary injunction stopping the rule from taking effect.
The fifth fiduciary rule lawsuit will be heard by a federal judge in Kansas on Sept. 21.
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Text of the judge’s order is at http://www.bloomberglaw.com/public/document/Chamber_of_Commerce_of_the_United_States_of_America_et_al_v_US_De/5.
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