Following the April 21, 2017, release of a Presidential Memorandum regarding the designation of non-bank firms as systemically important financial institutions (SIFIs), MetLife, Inc., has filed a motion with the U.S. Court of Appeals for the District of Columbia asking the court to hold the appeal by the Financial Stability Oversight Council in abeyance until a review of the SIFI designation process has been completed by the Secretary of the Treasury.
Tag rescinded. MetLife was designated as a SIFI in December 2014 and immediately challenged the designation in federal court. The U.S. District Court for the District of Columbia rescinded the SIFI designation in March 2016 and FSOC filed an appellate brief with the appeals court seeking to reverse the lower court ruling in June 2016 (see Banking and Finance Law Daily, March 30, 2016, April 7, 2017, and June 17, 2016). Subsequently, the appeals court ordered oral arguments, which were held on Oct. 24, 2016 (see Banking and Finance Law Daily, Aug. 24, 2016).
SIFI review. The Presidential Memorandum signed by President Donald J. Trump directed the Treasury Secretary to review the SIFI designation process to ensure that it is "a fair and transparent process." The memorandum also required that the Treasury Secretary issue a report within 180 days of the date of the memorandum (see Banking and Finance Law Daily, April 21, 2017).
"Substantially illuminate." MetLife based its motion to hold the appeal in abeyance on the court’s "inherent power" to take such action. The motion noted that Court of the Appeals for the District of Columbia has "repeatedly exercised that power by holding cases in abeyance to allow a new presidential administration to review the prior administration’s policies and the government’s positions in pending litigation."
The motion also contended that the results of the SIFI designation review "may substantially illuminate this Court’s consideration of the issues on appeal." MetLife also argued, "Neither the parties nor the public will be prejudiced by a decision to hold this appeal in abeyance, which would simply preserve the status quo by continuing to leave in place the district court’s ruling rescinding MetLife’s designation. Issuing an opinion during the ongoing review, on the other hand, would deny the new Administration the opportunity to ensure that the government’s positions in this litigation are consistent with the findings of the Treasury Secretary’s forthcoming report."
No merit. Commenting on MetLife’s motion, Dennis Kelleher, President and CEO of Better Markets, said, "MetLife’s request to stay its lawsuit against FSOC, now on appeal before the U.S. Court of Appeals for the District of Columbia Circuit, has no merit. MetLife is merely forum shopping and trying to substitute a political decision it is influencing for an independent judicial opinion that it cannot control and that will be based on the facts and law. Tellingly, MetLife’s filing today quotes the President’s Executive Memorandum, which is so similar to MetLife’s prior court filings that MetLife itself could have written the Memorandum." Kelleher added, "MetLife failed to mention in its stay request that, at best, the President’s Memorandum sets in motion a complex, multi-step, multi-year process with numerous critical decision points, all of which are highly uncertain and all of which argue against granting MetLife’s request for a stay."
Companies: Better Markets; MetLife, Inc.
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