Thrivent, DOL Anti-Arb Fiduciary Tussle Continues

Industry officials expect Labor to officially delay the more onerous prohibited transaction exemptions of its fiduciary rule by 18 months — from Jan. 1, 2018 to July 1, 2019 — by the end of October.  

The lawyers for Thrivent stated in their brief that "DOL primarily contends that Thrivent cannot establish irreparable harm because DOL has proposed an extension of the Jan. 1, 2018 applicability date, and thus 'the arrival of the applicability date [is] neither certain … nor imminent.'"

As a threshold matter, they continued, "DOL is again attempting to hold Thrivent to a 'certainty of harm' standard of its own creation. That is not the law. Thrivent must establish that 'irreparable injury is likely in the absence of an injunction.'"

Labor has "expressly conceded that '[w]hether, and to what extent, there will be changes' that affect the [BICE]'s anti-arbitration condition 'is unknown,'" the attorney wrote.

"There is no evidence in the record supporting DOL's remarkable assertion that the duly adopted regulations are unlikely to remain in place for the next two-and-a half months. And, particularly given that Thrivent is in this position due to DOL's prior issuance of an unlawful regulation, Thrivent cannot simply take DOL's speculative claims regarding future action at face value."

Thrivent's motion for a preliminary injunction should be granted, the attorneys concluded, and the court should "enjoin implementation and enforcement of the anti-arbitration condition of the BIC Exemption as to Thrivent until the conclusion of this litigation — whether as a result of a change in the BIC Exemption that truly moots this case or as a result of the court making a final determination on the merits of Thrivent's challenge."