The June 13th deadline for the Labor Department to petition the Supreme Court to hear its case passed without fanfare on Wednesday, as the fate of the DOL fiduciary rule remains in limbo.
The Fifth Circuit Court of Appeals vacated the fiduciary rule in a 2-to-1 split decision on March 15th but has yet to issue a mandate to dissolve the regulation which seeks to eliminate conflicted retirement investment advice. Without a mandate from the court, which was expected on May 7th, the fiduciary rule remains partially in effect.
The American Council of Life Insurers and the National Association of Insurance and Financial Advisors sent a letter to the Fifth Circuit requesting that the mandate be issued “as expeditiously as possible.”
Last month, a group of Senate Democrats, including Elizabeth Warren (D-MA), Sherrod Brown (D-OH), Cory Booker (D-NJ), Ron Wyden (D-OR), and Patty Murray (D-WA), sent a letter to Labor Secretary Alexander Acosta urging the DOL to request the high court to weigh in on the issue.
In a last-ditch effort to save the rule, the AARP and the attorneys general for California, New York and Oregon submitted motions with the Fifth Circuit court asking to intervene as defendants for a rehearing en banc, meaning that the full 17-judge court would rehear the matter if granted. The court denied the intervention requests.
Plaintiffs in the Fifth Circuit appeal case include the U.S. Chamber of Commerce, Financial Services Institute, Financial Services Roundtable, Insured Retirement Institute, and Securities Industry and Financial Markets Association.
To date, three federal district courts and the Tenth Circuit Court of Appeals have upheld the DOL’s fiduciary rule.
The fiduciary rule is currently under review as directed by President Trump, and enforcement was previously delayed until July 1, 2019. The Securities and Exchange Commission is currently seeking public comment for its own proposed best interest advice rules.