Majority of Judges in MetLife Appeal Appointed by Obama
September 26 2016 - 3:40PM
Dow Jones News
WASHINGTON—An appeal of a trial judge's decision to rescind
federal regulators' oversight of MetLife Inc. will be heard next
month by a panel largely consisting of judges appointed by
President Barack Obama, a result analysts say doesn't bode well for
the insurance company.
The U.S. Court of Appeals for the District of Columbia Circuit
said Monday the three-judge panel would consist of judges Sri
Srinivasan and Patricia Millett—both nominated by Mr. Obama—and A.
Raymond Randolph, a nominee of George H.W. Bush.
Analysts said the move is a positive outcome for the Financial
Stability Oversight Council, which is asking the appellate court to
overturn Judge Rosemary Collyer's March decision that the FSOC
acted arbitrarily and capriciously in designating the insurer as a
"systemically important financial institution," or SIFI. Regulators
apply the label to financial giants whose failure they believe
would threaten the economy, and the designation submits them to
much tougher rules on capital and use of borrowed money to reduce
their risks.
The appeal is set to be heard Oct. 24. Judge Collyer, who serves
on the District Court for the District of Columbia, was appointed
by President George W. Bush.
Edward Mills, an analyst at investment bank FBR & Co., said
the panel was a "bad draw" for MetLife, as the two Democratically
appointed judges "are likely to be more deferential to FSOC and the
government's authority in the case."
In a research note, Mr. Mills said, "While it was not a great
result for MET, the deck was 'stacked' against MET as seven of the
Court's 11 judges are Clinton or Obama appointees."
Robert Jackson of Columbia Law School also said the move is
unfavorable to the insurer. "If MetLife was hoping for this to be
affirmed, they've got to be disappointed in this panel," he
said.
A MetLife spokesman declined to comment on the appellate panel
but said the insurer "looks forward to oral argument where we will
continue to vigorously defend the lower court's carefully reasoned
opinion."
Write to Andrew Ackerman at andrew.ackerman@wsj.com
(END) Dow Jones Newswires
September 26, 2016 15:25 ET (19:25 GMT)
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