XY Planning Network, LLC v. SEC, 963 F.3d 244

In 2019 the SEC adopted Regulation Best Interest, imposing a four-part "best-interest obligation" on broker-dealers (disclosure, care, conflict mitigation, compliance) when they give retail customers personalized investment recommendations.
The Dodd-Frank Act directed the SEC to study standards of care (§913(b)) and included permissive rulemaking provisions (§913(f) and §913(g)) concerning standards for brokers, dealers, and investment advisers.
Petitioners: XY Planning Network and member Ford Financial Solutions (investment-adviser plaintiffs) and seven states plus D.C. (State Petitioners) challenged Regulation Best Interest under the APA, arguing the SEC should have imposed a uniform fiduciary standard under Dodd-Frank §913.
Ford asserted competitive injury: Regulation Best Interest would allow broker-dealers to claim a "best interest" duty, impairing Ford’s ability to market its fiduciary status and thus its ability to attract clients.
State Petitioners claimed speculative tax-revenue injury from alleged increased conflicted advice; SEC defended the rule as within its §913(f) discretion and supported by a reasoned administrative record weighing investor protection against costs and access.
The court held Ford has Article III standing (competitor standing), the states do not; it upheld the SEC’s statutory authority under §913(f) and found the rule not arbitrary and capricious; petitions were denied.

Issue	Plaintiff's Argument	Defendant's Argument	Held
Article III standing — Ford	Ford: rule injures business by eroding its marketing advantage in advertising a fiduciary duty	SEC: plaintiffs lack concrete, traceable injury	Held: Ford has competitor standing; states lack standing (injury too speculative)
Statutory authority under Dodd-Frank §913	Petitioners: §913(g) shows Congress intended a uniform fiduciary standard; §913(f) is only procedural	SEC: §913(f) is a broad, permissive grant authorizing Regulation Best Interest; §913(g) is a separate, discretionary option	Held: §913(f) permissively authorizes the SEC to promulgate Regulation Best Interest
APA — interpretation of IAA broker-dealer exemption	Petitioners: SEC misinterpreted the "solely incidental"/"special compensation" exemption, making the rule unlawful	SEC: interpretive guidance issued; exemption not central to the validity of the rule; the interpretation was not challenged here	Held: SEC’s interpretation is not so central or flawed as to render the rule arbitrary and capricious
APA — consumer confusion / economic analysis	Petitioners: SEC ignored evidence that consumers cannot distinguish standards; analysis inadequate	SEC: considered evidence, balanced reduced confusion against costs and access, provided reasoned explanation and substantial evidence	Held: SEC adequately considered confusion and economic effects; rule not arbitrary and capricious

Spokeo, Inc. v. Robins, 136 S. Ct. 1540 (2016) (Article III standing requires concrete, particularized injury)
Lujan v. Defenders of Wildlife, 504 U.S. 555 (1992) (standing requires concrete and particularized injury and traceability)
Clapper v. Amnesty Int’l USA, 568 U.S. 398 (2013) (speculative chain of future events insufficient for standing)
Sherley v. Sebelius, 610 F.3d 69 (D.C. Cir. 2010) (competitors suffer injury when agencies allow increased competition)
Sierra Club v. EPA, 292 F.3d 895 (D.C. Cir. 2002) (standing evidence standards in administrative challenges)
Town of Chester v. Laroe Estates, Inc., 137 S. Ct. 1645 (2017) (at least one plaintiff must have standing to seek requested relief)
Wyoming v. Oklahoma, 502 U.S. 437 (1992) (states may have standing for direct loss of tax revenues)
Fin. Planning Ass’n v. SEC, 482 F.3d 481 (D.C. Cir. 2007) (prior D.C. Cir. decision striking SEC rule expands legislative context)
Nat. Res. Def. Council, Inc. v. FAA, 564 F.3d 549 (2d Cir. 2009) (arbitrary-and-capricious review standard)
County of Westchester v. U.S. Dep’t of Hous. & Urb. Dev., 802 F.3d 413 (2d Cir. 2015) (deference to reasoned agency decisions)