There’s a famous saying that war is politics continued by other means, and I have paraphrased it in the past to point out that patent infringement litigation is frequently simply business competition continued by other means. I think it is similarly fair to say that the lawsuit seeking to overturn the Department of Labor’s new conflict of interest/fiduciary regulations is the continuation of politics by other means. Having lost over the issue before the administration and having failed to convince Congress to halt this major piece of rule making, opponents of the regulatory initiative have turned to the courts, making, essentially, the same arguments against the regulations that they previously made in the political venues: that it is onerous, oversteps the Department’s expertise and authority, is procedurally invalid, and too costly. You can find the complaint itself here.
There is a lot more to be said about the complaint, its allegations and the legal theories it presses, and I intend to comment more extensively as the case proceeds. However, for now, I would simply highlight the extent to which, as a piece of advocacy, the complaint itself is a beautiful piece of work. Perhaps even more than as advocacy, it really works as a piece of storytelling. Don’t misunderstand me when I say that – that is not meant as a criticism. I have always been an advocate of, when you have a good story to tell, telling it in the complaint, even if it goes far beyond what the federal rules require to avoid dismissal. I follow that practice myself in my own filings. There are multiple reasons for doing so, including that it allows a plaintiff to set the initial terms of discussion, and to place the case in the context that is best for the plaintiff. A skilled defense counsel will thereafter push back and seek to reframe the discussion in later filings (such as in a motion to dismiss), but will still have been forced by the complaint to engage with the narrative chosen by the plaintiff. Moreover, in complex areas of the law like ERISA, it is important to remember that our judiciary consists of generalists, with judges naturally having more experience in certain areas than in others. On the same panel of judges not too long ago, I heard one judge from a coastal state joke that, prior to being appointed to the bench, he thought ERISA was a special type of maritime winch, while another judge on the same panel pointed out that he had litigated ERISA cases for years before joining the bench. A complaint that contains a well-written narrative, as this one does, allows a plaintiff to characterize the case, at the outset, for an audience that may or may not be exceptionally versed in the subject area at issue in the case.
Even so, though, and as is especially important with regard to this action, it is important not to get lost in the story being presented in the complaint, and to remember that the legal issues themselves are what matter – and that they are often simultaneously more mundane and nuanced than the surrounding details would suggest. I think that is worth keeping in mind in reading this complaint, as the actual legal issues are much more subtle than the broad discussion of financial services regulation in the complaint might suggest: the case isn’t, in the end, going to be about the propriety or scope of regulating the financial industry, but instead about the scope of the Department’s authority and the procedural manner in which it acted. The long run up of factual allegations in the complaint would suggest otherwise, but the causes of action themselves make that clear.