On August 9, 2017, the Department of Labor (“DOL”) stated in a court filing that the Office of Management and Budget (“OMB”) is reviewing a proposal to extend the applicability date for certain requirements under DOL’s fiduciary rule until July 1, 2019. As discussed here and here the fiduciary rule’s “impartial conduct standards” have been in effect since June 9, 2017; but other requirements, including the written contract required under the Best Interest Contract exemption and certain disclosure requirements, have been delayed pending DOL’s review of the rule.  DOL’s request suggests that DOL will need significantly more time to complete its review of the rule.

On March 20, 2017, a federal court in the Northern District of Texas denied the U.S. Chamber of Commerce’s emergency motion for an injunction pending appeal challenging implementation of the Department’s conflict of interest rule and related exemptions. The court applied the standard for evaluating a preliminary injunction motion and concluded that: (i) the Department

There were two key developments last week concerning the ongoing challenges to the U.S. Department of Labor (USDOL) conflict of interest rule and related exemptions:  a Presidential Memorandum calling for a review of the rule, and a ruling by a federal court in Texas rejecting the U.S. Chamber of Commerce’s challenges to the rule.

Presidential

On December 15, 2016, the U.S. Court of Appeals for the District of Columbia Circuit denied the emergency request from the National Association for Fixed Annuities (“NAFA”) for an injunction blocking the implementation of the Department of Labor’s conflict of interest rule and related exemptions.  Nat’l Ass’n for Fixed Annuities v. U.S. Dep’t of Labor, D.C. Cir., No. 16-5345, per curiam order 12/15/16.  In a one-paragraph order, the panel ruled that NAFA “has not satisfied the stringent requirements for an injunction pending appeal.”  NAFA’s challenge to the rule had already been rejected twice by Judge Moss in the U.S. District Court for the District of Columbia (see our blog here).

On November 28, 2016, Judge Crabtree in the U.S. District Court for the District of Kansas ruled in favor of the U.S. Department of Labor and denied the motion for a preliminary injunction filed by the Market Synergy Group, Inc., challenging implementation of the Department’s conflict of interest rule and related exemptions.  Mkt. Synergy Grp., Inc. v. United States Dep’t of Labor, No. 16-CV-4083-DDC-KGS, 2016 WL 6948061 (D. Kan. Nov. 28, 2016).  The court held that Market Synergy was not likely to prove that: