The Fifth Circuit Court of Appeals again ruled against the state attorneys general of New York, California and Oregon to intervene in the case against the Department of Labor’s fiduciary rule.
In a 2-1 ruling, a three-judge panel denied the states’ second request that the case against the DOL be heard by the full court. The states made the request last week in a last-ditch attempt to save the rule.
A three-judge panel of the Fifth Circuit ruled 2-1 in March to vacate the rule, which would have required retirement investment advisors to put interests of their clients ahead of their own. The states, along with AARP, filed motions to intervene to get the full court to hear the case. They were denied, leading to the states’ motion to reconsider.
While the court effectively vacated the rule, it has yet to finalize its decision, leading the DOL to issue a temporary enforcement policy.
Meanwhile, the DOL has until June 13 to take the case to the Supreme Court, and the Securities and Exchange Commission recently voted to propose a rule package that purports to set a best interest standard for broker/dealers. The deadline public comment on the SEC rules is Aug. 7.