We would love to hear from you. Click on the ‘Contact Us’ link to the right and choose your favorite way to reach-out!

wscdsdc

media/speaking contact

Jamie Johnson

business contact

Victoria Peterson

Contact Us

855.ask.wink

Close [x]
pattern

Industry News

Categories

  • Industry Articles (21,155)
  • Industry Conferences (2)
  • Industry Job Openings (35)
  • Moore on the Market (414)
  • Negative Media (144)
  • Positive Media (73)
  • Sheryl's Articles (800)
  • Wink's Articles (353)
  • Wink's Inside Story (274)
  • Wink's Press Releases (123)
  • Blog Archives

  • March 2024
  • February 2024
  • January 2024
  • December 2023
  • November 2023
  • October 2023
  • September 2023
  • August 2023
  • July 2023
  • June 2023
  • May 2023
  • April 2023
  • March 2023
  • February 2023
  • January 2023
  • December 2022
  • November 2022
  • October 2022
  • September 2022
  • August 2022
  • July 2022
  • June 2022
  • May 2022
  • April 2022
  • March 2022
  • February 2022
  • January 2022
  • December 2021
  • November 2021
  • October 2021
  • September 2021
  • August 2021
  • July 2021
  • June 2021
  • May 2021
  • April 2021
  • March 2021
  • February 2021
  • January 2021
  • December 2020
  • November 2020
  • October 2020
  • September 2020
  • August 2020
  • July 2020
  • June 2020
  • May 2020
  • April 2020
  • March 2020
  • February 2020
  • January 2020
  • December 2019
  • November 2019
  • October 2019
  • September 2019
  • August 2019
  • July 2019
  • June 2019
  • May 2019
  • April 2019
  • March 2019
  • February 2019
  • January 2019
  • December 2018
  • November 2018
  • October 2018
  • September 2018
  • August 2018
  • July 2018
  • June 2018
  • May 2018
  • April 2018
  • March 2018
  • February 2018
  • January 2018
  • December 2017
  • November 2017
  • October 2017
  • September 2017
  • August 2017
  • July 2017
  • June 2017
  • May 2017
  • April 2017
  • March 2017
  • February 2017
  • January 2017
  • December 2016
  • November 2016
  • October 2016
  • September 2016
  • August 2016
  • July 2016
  • June 2016
  • May 2016
  • April 2016
  • March 2016
  • February 2016
  • January 2016
  • December 2015
  • November 2015
  • October 2015
  • September 2015
  • August 2015
  • July 2015
  • June 2015
  • May 2015
  • April 2015
  • March 2015
  • February 2015
  • January 2015
  • December 2014
  • November 2014
  • October 2014
  • September 2014
  • August 2014
  • July 2014
  • June 2014
  • May 2014
  • April 2014
  • March 2014
  • February 2014
  • January 2014
  • December 2013
  • November 2013
  • October 2013
  • September 2013
  • August 2013
  • July 2013
  • June 2013
  • May 2013
  • April 2013
  • March 2013
  • February 2013
  • January 2013
  • December 2012
  • November 2012
  • October 2012
  • September 2012
  • August 2012
  • July 2012
  • June 2012
  • May 2012
  • April 2012
  • March 2012
  • February 2012
  • January 2012
  • December 2011
  • November 2011
  • October 2011
  • September 2011
  • August 2011
  • July 2011
  • June 2011
  • May 2011
  • April 2011
  • March 2011
  • February 2011
  • January 2011
  • December 2010
  • November 2010
  • October 2010
  • September 2010
  • August 2010
  • July 2010
  • June 2010
  • May 2010
  • April 2010
  • March 2010
  • February 2010
  • January 2010
  • December 2009
  • November 2009
  • October 2009
  • August 2009
  • June 2009
  • May 2009
  • April 2009
  • March 2009
  • November 2008
  • September 2008
  • May 2008
  • February 2008
  • August 2006
  • DOL Best Interest Contracts Could Cause Surge in State Litigation

    June 27, 2017 by Emile Hallez

    State-level litigation against brokers could begin to ramp up next year, if the Department of Labor’s best interest contract exemption rule goes into full effect, reports Ignites.

    An increase in lawsuits in all 50 states would be expected, since the new written agreements could lay the grounds for breach-of-contract claims from IRA investors, several lawyers at Goodwin Procter said during a recent presentation.

    “We could potentially see these cases brought against anyone relying on BIC since BIC requires a written contract for IRAs (i.e., non-ERISA plans),” says Goodwin partner Jamie Fleckner in an e-mail response, following the panel presentation. “If other types of plan service providers were relying on BIC, they would be potentially subject to such state court breach of contract claims as well.”

    At present, advisors working with clients’ retirement assets on a commission basis will be required to start using the contracts on January 1. Complicating the matter is that laws vary by state and some states are even considering their own fiduciary rules for advisors. Nevada is the first to move forward with a such a requirement, which goes into effect July 1.

    “There are certainly a number of differences among the state courts which will affect how litigation there proceeds,” Fleckner states. Those differences include better-developed laws in some states, including those that determine what qualifies for class action status. Other factors include whether states have dedicated business litigation sessions and the composition of judges and juries, he states. “I expect that, if the BIC contract requirements go into effect in 2018 and plaintiffs’ lawyers test contract claims, we will also see them test different jurisdictions for their claims.”

    In states that put laws on the books overlapping with provisions in the BIC, things could get murky.

    “Erisa has a broad preemption clause that precludes the application of certain state laws that relate to employee benefit plans, like retirement plans,” Fleckner states. “But because the BIC is designed to allow private suits as to IRAs, which are not otherwise covered under Erisa’s private enforcement regime, aspects of litigation under Erisa — like preemption and federal court jurisdiction — may not be available.”

    Indeed, the BIC exemption does not preclude plaintiffs from pursuing claims under state law, says Jason Roberts, CEO of the Pension Resource Institute, in an e-mail response.

    “The plaintiff could allege a breach of [the BICE] contract claim and [simultaneously] allege a breach of fiduciary duty under applicable state law,” he states.

    However, for clients with plans covered under Erisa, it could be recommended that service providers draft disclaimers to accompany certain communications, such as responding to a request for proposals, said Goodwin partner Scott Webster during the webcast.

    It could be useful for firms to explain in writing that they are not acting as fiduciaries in certain circumstances, he said.

    “People should consider doing more disclaimers,” he said. “There are going to be more opportunities … to think about what communications you’re having with Erisa plans and if there is an opportunity to do a broad disclaimer.”

    But the future of the fiduciary rule and the accompanying BIC exemption is anything but certain. The Department of Labor is currently evaluating the rule under the directive of President Donald Trump. That process could result in the agency’s potentially revising its provisions or scrapping it altogether.

    Further, there have been four lawsuits filed in attempt to block the fiduciary rule, three of which the DOL has won through summary judgment, though those cases are currently in the appeals process. The fourth lawsuit, which was filed by Thrivent Financial, has motions for summary judgment being briefed, Goodwin Procter lawyers noted during the presentation.

    The other three lawsuits were brought by the U.S. Chamber of Commerce, Market Strategy Group and the National Association of Fixed Annuities.

    “The courts have denied requests for injunctions,” said Dave Rosenberg, Erisa litigation associate at Goodwin. “It’s likely we’ll see a ruling in the Chamber of Commerce case before Jan 1, 2018.”

    But even if the BIC exemption takes full effect beginning next year, mandatory arbitration could be baked into contracts.

    “Breach of contract claims are typically brought in state court, however, nothing in the rule prevents a financial institution from requiring individual claims (vs. class actions) to be arbitrated,” Roberts says. “That said, there is always the chance that a plaintiff/claimant could file in state court and the defendant/respondent would have to seek to compel the court to send the claim to arbitration.”

    Originally Posted at Life Annuity Specialist on June 26, 2017 by Emile Hallez.

    Categories: Industry Articles
    currency