AUSTIN – On Nov. 16 Texas Attorney General Ken Paxton announced that a federal judge granted a permanent, nationwide injunction in favor of Texas, Arkansas, and eight other states in National Federation of Independent Business, et al. v. Perez.

The case concerns the U.S. Department of Labor’s plan to impose new rules making it more difficult and expensive for small business owners to obtain legal advice.

Attorney General Paxton, along with Arkansas Attorney General Leslie Rutledge, led the 10-state coalition fight to stop the rules from taking effect.

The court order states that the DOL’s revised “persuader advice exemption rule” is unlawful and would have required attorneys to reveal to the DOL certain confidential information protected by attorney-client privilege.

The Obama administration had previously appealed the grant of the preliminary injunction to the United States Fifth Circuit Court of Appeals, but the summary judgment makes that appeal moot.

“For the last eight years, the federal government's appetite for regulations has driven it to chisel away at the rule of law unceasingly,” said Paxton.

“The Department of Labor, by implementing its ‘persuader rule’ interfered with the most basic right of Americans to rely on the advice of legal counsel. Attorney-client privilege is a sacred part of our adversarial system and cannot be undermined merely to advance the political interests of organized labor. The Obama administration would do well to remember today's ruling before it tries again to assert control where it doesn't belong.”

Plaintiffs in this case are the National Federation of Independent Business, Texas Association of Business, Lubbock Chamber of Commerce, National Association of Home Builders, and Texas Association of Builders. Joining Texas and Arkansas in this case are Alabama, Indiana, Michigan, Oklahoma, South Carolina, Utah, West Virginia, and Wisconsin.

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