The Department of Labor, in finalizing its fiduciary rule, “has sought to transform the financial services and insurance industries, stepping far beyond its authority” under the Employee Retirement Income Security Act and the IRS Code governing individual retirement accounts, the U.S. Chamber of Commerce argues in latest brief filed Monday in federal court in Texas.
DOL’s rule makes “radical” changes to the term “fiduciary,” which “is not animated by a change in its perception of what ‘fiduciary’ means,” but reflects Labor’s “discontent with aspects of the securities laws, mutual funds, broker-dealers, and other matters outside the Department’s authority and expertise,” the Chamber argued in its motion for summary judgment.
The Chamber asserts that DOL “failed to faithfully interpret the applicable statutes; misused its exemptive authority; ignored inconvenient record evidence; relied on a deeply flawed cost-benefit analysis; and infringed First Amendment rights” by finalizing its fiduciary rule, arguing that the rule and its exemptions should be vacated.
Oral arguments from both the DOL and lawyers representing plaintiffs in the three lawsuits filed in Texas against DOL’s rule will take place Nov. 17. The three lawsuits pending in the state have been consolidated.
The Chamber is one of the nine plaintiffs in the first suit, filed June 2 in the Texas district. The others include the Securities Industry and Financial Markets Association, the Financial Services Institute, the Financial Services Roundtable, the Insured Retirement Institute and four Texas groups, including the Texas Association of Business.
The nine groups are represented by former DOL solicitor Eugene Scalia, who’s now a partner in Gibson, Dunn & Crutcher’s Washington office.
The second suit was filed June 8 by the American Council of Life Insurers along with the National Association of Insurance and Financial Advisors, and the third suit was filed on June 9 by the Indexed Annuity Leadership Council.