Those who oppose the fiduciary rule should feel very hopeful today. After a long losing streak in court, it appears that opponents of rule are finally winning in the most important court battle yet. Following losses in lower courts, a number of business groups’ case against the rule is being held in the US fifth circuit court. A day into the proceedings, they appear to be winning convincingly. One of the three judges on the panel spent nearly the entire first session grilling the DOL on its best interest contract and its exemptions. The DOL was reportedly unprepared for the attack and was unable to satisfyingly answer the court’s question. The judge leading the inquiry appeared very critical of the agency, and the plaintiffs were able to make a convincing case that the DOL far over-reached its mandate in making the fiduciary rule.
FINSUM: This is the best day in court opponents of the rule have ever had, and it makes it look like the fiduciary rule may actually be blocked in the courts. The case is being fast-tracked and a full ruling is expected in the Autumn.