May 05, 2004
D.C. District Court Rules Gramm-Leach-Bliley Act Beyond FTC's Statutory Authority
The ABA and the New York State Bar just won at the federal district court level (D.C.) in their suits against the FTC regarding the application of the Gramm-Leach-Bliley Act to the practice of law, particularly in "financial activities" which include real estate settlement, tax-planning, and tax preparation services. If the decision ultimately stands, it appears attorneys should have one less regulatory concern regarding privacy notices and related provisions.
ABA President Dennis Archer sent out a mass e-mail to ABA members describing the victory, including the link to the ABA's GLBA web page wherein you can find the D.C. district court decision in PDF format.
Judge Reggie Walton of the U.S. District Court for the District of Columbia signed the order granting summary judgment:
"This is because the case is now in a posture where, for all of the reasons expressed by this Court in its August 11, 2003 Memorandum Opinion, the Court can now definitively conclude as a matter of law, pursuant to 5 U.S.C. § 706(2)(C), that Congress did not intend for the GLBA's privacy provisions to apply to attorneys who provide legal services in the fields of real estate settlement, tax-planning and tax preparation, and that, pursuant to 5 U.S.C. § 706(2)(A), the FTC's interpretation that attorneys are subject to the GLBA's privacy provisions constitutes "arbitrary and capricious" agency action.[Update 5.07.04: The ABA Journal eReport has a good article discussing the ramifications and issues surrounding these developments.]