Client Login Portal
    • addthis
    • link : Client Login
    • knowledge network
    • Practice Areas
    • Cases
    • About Us
    • News & Events
    • Our People
    • Knowledge Network
    • Contact Us
    Labaton Sucharow
    • addthis
    • link : Client Login
    • knowledge network
    • Practice Areas
    • Cases
    • About Us
    • News & Events
    • Our People
    • Knowledge Network
    • Contact Us
    • Practice Areas
    • Cases
    • About Us
    • News & Events
    • Our People
    • Contact Us
    • Knowledge Network
    • Client Login
    • Search
    • addthis
    • link : Client Login
    • knowledge network
    Labaton Sucharow
    • News & Events
      • Press Room
      • Published
      • Events
    • Digital Library
      • Videos
      • Podcasts
      • Webinars
    • News & Events
      • Press Room
      • Published
      • Events
      • The Liaison
    • Digital Library
      • Videos
      • Podcasts
      • Webinars

    DOL Fiduciary Rule Challengers Leave Nothing to Chance

    Law360
    June 2, 2016

    Joel Bernstein weighs in on recent lawsuit challenging the U.S. Department of Labor fiduciary rule

    Industry groups filing a lawsuit challenging the U.S. Department of Labor’s fiduciary rule have covered all their bases in an effort to increase their chances of success, backing up novel administrative law claims with a First Amendment claim and filing in an injunction-friendly Dallas federal court. The U.S. Chamber of Commerce, the Securities Industry and Financial Markets Association, and six other national and local industry groups filed the lawsuit recently to halt the final rule imposing a fiduciary duty on financial professionals who advise retirement account savers. They argue the DOL overstepped its authority and that the new regulations will harm retirement savers.

    The complaint said the requirement that financial professionals act in their client’s best interest when recommending investment products—a higher standard than the current approach of promoting products that are merely suitable to an investor—will cost broker-dealers billions of dollars to implement and could hamper their ability to provide advice to investors.

    Joel H. Bernstein, a partner at Labaton Sucharow, said that the suit may be hampered by a Fifth Circuit decision from the 1980s that, in discussing allegations that a broker-dealer was making multiple unnecessary transactions in a customer’s account to rake in fees, recognized that broker-dealers have a fiduciary duty under Texas common law.

    “These plaintiffs, the Chamber of Commerce and others like them, are making a mountain out of a molehill,” Bernstein added. “For financial professionals to say they don’t want the law to require them to tell the truth, be trustworthy, and protect money that someone deposits with them is totally ludicrous.”

    Useful Links

    • Practice Areas
    • Cases
    • About Us
    • News & Events
    • Our People
    • Knowledge Center

    Our Locations

    footer-list-map_icon New York
    140 Broadway
    New York, NY 10005
    212-907-0700

    footer-list-map_icon Delaware
    222 Delaware Avenue, Suite 1510
    Wilmington, DE 19801
    302-573-2540

    Useful Links

    footer-list-map_icon Washington, D.C.
    1050 Connecticut Avenue, NW, Suite 500
    Washington, D.C. 20036
    212-907-0700

    Stay Connected

    • Facebook
    • Twitter
    • LinkedIn
    Labaton Sucharow
    • Attorney Advertising Disclaimer
    • Privacy Policy
    • Transparency in Coverage Rule
    • labaton.com
    • Labaton Sucharow All Rights Reserved 2023

    Attorney Advertising Disclaimer

    The materials appearing on this website are provided for informational purposes only and do not constitute legal advice. You should not take action based upon this information without consulting legal counsel. This site is not intended to create an attorney-client relationship. The hiring of a lawyer is an important decision that should not be based solely upon any single source of information, including advertising on this website. You may ask us to send you further information about us, and we urge you to review other sources of information about us.