Late Friday night, July 26th, Judge O’Connor of the Northern District of Texas issued a decision in the Joint Trades lawsuit granting a stay of the Rule’s effective date, agreeing that “Plaintiffs are virtually certain to succeed on the merits.” The stay is not limited to the parties and applies nationwide.
FACC is pleased with and grateful for Judge Kernodle’s decision to stay the DOL’s rule.
On Thursday, July 25th, just two days after FACC presented its Oral Argument, Judge Kernodle, granted FACC’s motion.
EXCERPT
The Court grants Plaintiffs’ motion. As explained below, Plaintiffs are likely to succeed on the merits of their claim because the 2024 Fiduciary Rule conflicts with ERISA in several ways, including by treating as fiduciaries those who engage in onetime recommendations to roll over assets from an ERISA plan to an IRA. DOL’s related amendments to Prohibited Transaction Exemption 84-24 are also unreasonable and arbitrary and capricious.
“Plaintiffs’ Motion details the multiple ways in which the 2024 Fiduciary Rule runs afoul of the Fifth Circuit’s decision in Chamber of Commerce of United States of Am. v. United States Dep’t of Labor, 885 F.3d 360, 388 (5th Cir. 2018). Unable to mount a credible argument to the contrary,
“FACC welcomes efforts of the Department of Banking and Insurance to adopt the updated National Association of Insurance Commissioners (NAIC) Model Regulation #275 incorporating best interest obligations into existing suitability regulations. Assuming it is the intent of the Department to adopt the NAIC model regulation updates in their entirety, FACC
“FACC overall is pleased with and supports the proposal published on the Department website as Revised Proposed Regulation R109-23. FACC commends the Division for its continuing efforts and general adherence to the updated 2020 NAIC Suitability in Annuity Transactions Model #275. FACC believes adoption of the updated NAIC model regulation
Below is the response from DOL, as a defendant, opposing the motion from FACC for a preliminary injunction that would suspend enforcement of the fiduciary rule. Here is an excerpt from the defendants’ filing: “Plaintiffs—insurance professionals and a trade association representing insurance professionals—seek a preliminary injunction and stay of the
Before the Court is Plaintiffs’ agreed motion for leave regarding page limits and for a briefing schedule on their motion for a preliminary injunction. Docket No. 7. The Court GRANTS the motion. Plaintiffs’ motion for a preliminary injunction (Docket No. 8) is accepted as filed.
Below is FACC’s motion for a Preliminary Injunction suspending the enforcement of the DOL fiduciary rule and brief.
FACC commends the Louisiana Department of Insurance for moving forward in adopting updates to the National Association of Insurance Commissioners (NAIC) Model Regulation #275. The updated regulation incorporates best interest obligations in a manner that is attuned to the unique characteristics of the insurance industry. In particular, we support efforts
The Federation of Americans for Consumer Choice (FACC)
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