Court rejects states' last-ditch effort to save fiduciary rule
A federal court has rejected a last-ditch effort from three states to salvage the Department of Labor's fiduciary rule.
The 5th U.S. Circuit Court of Appeals has denied a motion to reconsider the decision to vacate the controversial regulation, the second such request the state attorneys general had made.
Separately, the attorneys general had asked the court for permission to seek a rehearing before the full complement of judges on the 5th Circuit in what is known as an en banc hearing. The court also rejected that request.
"This panel previously denied the States of California, New York and Oregon's motion to intervene and file a rehearing en banc. The panel has considered the motion for reconsideration. It is ordered that the motion is denied," the court ruled.
"It is further ordered that the alternative motion to permit the filing of a petition for rehearing en banc seeking review of the court's order denying the motion to intervene by the full En Banc Court is denied," the ruling continued.
The states' attempt to intervene in the case, as well as a similar effort by AARP, one of the nation’s largest retiree advocacy groups, had been seen as an extreme longshot. It was one of the few remaining options for supporters of the rule, which the Labor Department has opted not to defend.
The DoL had said that it would stop enforcing the fiduciary rule following the court's decision to strike down the regulation in March.
California Attorney General Xavier Becerra's office had insisted that the regulation set "commonsense standards for professionals who give investment advice to people saving for retirement."
Striking down the rule, the AGs argued, would "deprive millions of Americans of basic safeguards as they seek financial advice about their retirement investments."