Primerica Regulatory Proceeding

The Department of Labor proposed a rule extending the definition of “fiduciary” under ERISA to cover a wider range of investment brokers and advisers. Working with Lewis Clayton and others at Paul, Weiss, Rifkind, Wharton, and Garrison LLP, as well as in-house counsel at Primerica, Compass Lexecon’s President, Professor Daniel R. Fischel and Dr. Todd Kendall authored a white paper on the proposed rule, submitted as a comment to the Department of Labor (DOL). Professor Fischel and Dr. Kendall’s paper criticized the cost-benefit study performed by the DOL for not properly accounting for many costs that would likely follow from the proposal, and for overstating the potential benefits of the proposal. The DOL subsequently withdrew the proposed rule. In an editorial applauding the decision, the Wall Street Journal wrote that the Department “may also have seen defeat coming in courts that are showing less tolerance for sloppy rule-making.”