Texas Court Halts DOL Fiduciary Rule

A Texas federal judge has temporarily blocked the Department of Labor's (DOL) 2024 fiduciary rule, which aimed to expand fiduciary duties to more retirement advice providers, including insurance agents. Judge Jeremy Kernodle stated that the plaintiffs, an insurance industry trade association, are likely to succeed in their claims as the rule conflicts with the Employee Retirement Income Security Act (ERISA) by redefining fiduciaries in a way that includes one-time advice scenarios. The ruling indicated that the DOL's amendments to related exemptions were deemed unreasonable and arbitrary. This decision follows a broader legal challenge to the rule, with another lawsuit filed by various trade associations contesting different aspects of the fiduciary rule. The DOL's efforts to reconcile the rule with existing legal frameworks are expected to face further scrutiny in higher courts.