The Labor Department has paused its consolidated appeals of two district courts' universal stays of Labor's 2024 fiduciary rule.
The filing in U.S. Court of Appeals for the Fifth Circuit states that, due to the recent change in administration on Jan. 20, "DOL is now under new leadership," and that new agency officials "are still in the process of on boarding and familiarizing themselves with all of the issues presented by pending litigation."
To allow new DOL officials "sufficient time to become familiar with the issues in these cases and determine how they wish to proceed, the government respectfully moves to place these consolidated appeals in abeyance, with status reports due at 60-day intervals," the filing states.
"My view is that it is a fairly routine 'hold' pending a review by the new DOL Secretary and Assistant Secretary for the [Employee Benefits Security Administration], once both are confirmed and in place," ERISA attorney Fred Reish of Faegre Drinker told ThinkAdvisor Wednesday. "It means that the DOL could withdraw from the case, but it doesn’t necessarily mean that it will."
The requested abeyance would, if granted, remove appellees’ obligation to file response briefs by the current deadline of Feb. 14, the filing states.
In the event the court denies the motion for an abeyance, "all parties jointly request a one-week extension," to and including Feb. 21.
On Sept. 20, Labor filed in the Fifth Circuit Court of Appeals to reverse two rulings from federal courts in Texas that temporarily stopped the new fiduciary rule from taking effect. Before the stays were granted, the rule was set to take effect Sept. 23.
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