Typical yellow taxi in Manhattan street, New York city.

The attorneys general (AGs) of New York, California and Oregon have filed a motion seeking to intervene in a legal case involving the U.S. Department of Labor’s (DOL) fiduciary rule in order to defend regulations that require retirement investment advisors to put the interests of their clients above their own financial gain.

Last month, a three-judge panel of the U.S. Fifth Circuit Court of Appeals issued a decision overturning the rule.

The three AGs have filed a motion to intervene in that case; they’ve also filed a petition asking the full 17-judge court to rehear the case and overturn the decision made by the three-judge panel.

“It’s common sense: financial advisors should act in their client’s best interest, not their own,” says Eric Schneiderman, New York attorney general, in a statement.

“The fiduciary rule is vital to protecting families in New York and across the country who are saving for their retirement. Our coalition will continue to fight to ensure that the interests of hardworking Americans are put first,” he says.

Three federal district courts and the U.S. Tenth Circuit Court of Appeals have previously upheld the fiduciary rule, the AGs note, and this latest ruling conflicts with those previous decisions.

The three AGs also contend the decision:

  • will deprive investors of basic safeguards as they seek financial advice about their retirement investments;
  • will cost retail investors tens of billions of dollars; and
  • the court was wrong to conclude that the DOL lacked authority to make the rule.