On March 30, District Judge Rosemary Collyer ruled to rescind the life insurance giant’s designation as ‘too big to fail', thus freeing it from the added regulatory burdens placed on such institutions under the 2010 Dodd-Frank Wall Street reform law. However, the lifted label is still hovering ominously above MetLife’s head. The Financial Stability Oversight Authority lodged an appeal against Collyer’s decision in June followed quickly by amicus briefs from high-profile supporters including Senator Chris Dodd and Representative Barney Frank. Now, MetLife’s lawyers are gearing up once again to make sure that the repeal stays in place.

MetLife: FSOC methodology is ‘clouded in mystery’

As in its original appeal, MetLife is calling into question the process by which the FSOC classed the insurer as systemically important. ‘Having decided to target MetLife for designation, FSOC selectively applied the statutory criteria established by Congress, [and] repeatedly departed from its own regulations in order to overcome MetLife’s evidence and analysis,’ contend MetLife’s lawyers in a filing submitted to a Washington federal appeals court on Monday. In particular, MetLife is pointing to the FSOC recent decision to take an ‘activities-based’ approach to regulating risk in asset managers and mutual funds – an approach that was requested by and denied to MetLife. ‘Many of the largest mutual funds have assets under management that vastly exceed MetLife’s assets, and their liquidation could have a substantially larger impact on market prices than the liquidation of an insurer like MetLife,’ the filing argues.

Sources: BigLaw Business; Reuters