Federal Court Upholds DOL Fiduciary Rule
In the first of several legal challenges to the Department of Labor’s fiduciary rule to be decided, the U.S. District Court for the District of Columbia on Friday denied the National Association for Fixed Annuities’ arguments against the rule.
NAFA’s lawsuit sought a preliminary injunction to delay the implementation of the rule, as well as a ruling to vacate and set aside the fiduciary rule in its entirety.
Instead, judge Randolph Moss issued a 92-page memorandum opinion which rejected NAFA’s arguments and instead granted the Department of Labor’s cross-motion for summary judgement.
In a statement issued in response to the ruling, Secretary of Labor Thomas Perez said, “The conflicts of interest rule was developed after substantial input from a variety of stakeholders, including the industry, and it will make sure that retirement savers receive advice that puts their interests first. I’m pleased that the court recognized the comprehensive and thoughtful process we used in crafting this rule.”
NAFA, which contends that the DOL fiduciary rule will, “have catastrophic consequences for the fixed indexed annuities industry,” sought to block the rule on the grounds that the new definition of fiduciary was improper and that the DOL was not empowered to enact such a rule.
Five lawsuits challenging the fiduciary rule remain to be decided, and NAFA has not yet indicated if they will pursue an appeal of Judge Moss’ decision.
