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Texas court upholds DOL fiduciary rule, denies stay

U.S. District Judge Barbara M.G. Lynn in Dallas late Wednesday dismissed a legal challenge to the Department of Labor's fiduciary rule.

She also denied the Justice Department's motion, made Wednesday, to stay the case while the agency reviews the rule following a White House executive order.

The lawsuit filed June 1 by the U.S. Chamber of Commerce, Securities Industry and Financial Markets Association and other financial groups, challenged the DOL's authority to issue the rule on several issues. Ms. Lynn disagreed with those points, saying that “the rule does not exceed DOL's authority,” and the agency's cost-benefit analysis was reasonable, among other reasons for granting the Department of Labor's motion for summary judgment.

Federal district courts in Topeka, Kan., and Washington in 2016 upheld the rule in similar challenges, which have been appealed. A fourth case in Minneapolis has not been decided.