The U.S. Chamber, Financial Services Institute, Financial Services Roundtable, Insured Retirement Institute, and Securities Industry and Financial Markets Association filed a notice of appeal to the Fifth Circuit challenging the Department of Labor’s (“DOL”) so-called “Fiduciary Rule.” Among other things, the Rule provides that exemptive relief will not be available if a financial firm or representative has an arbitration agreement with a customer that includes a class action waiver. The Chamber alleges that this prohibition of class waivers violates the FAA.
The co-plaintiffs issued the following statement on their notice of appeal:
“We remain confident in the merits and strength of our case and stand by our assertion that the Department of Labor exceeded its authority. We have long supported a best interest standard, adopted by the appropriate regulatory authority and across all individual investor accounts, not just retirement. This is a misguided rule that will harm retirement savers and financial services firms that provide needed assistance and options to their clients, including modest savers and small business employees. Further, the ‘private right of action’ mechanism creates unwarranted litigation risk for financial advisors, who will face the threat of meritless class action lawsuits challenging their every move.”
The five national co-plaintiffs filed the appeal in conjunction with the Greater Irving-Las Colinas Chamber of Commerce, Lake Houston Area Chamber of Commerce, Lubbock Chamber of Commerce, and Texas Association of Business.
