Robinhood on Thursday sued to quash Massachusetts' new fiduciary rule and block the state's securities division from pursuing its case against the online brokerage.
The company said the state agency's new rule "exceeds" its authority under state and federal law."
Massachusetts Commonwealth Secretary William Galvin had sued Robinhood last year, arguing that the trading app of turning online retail stock trading into a risky game, especially for inexperienced investors. The company rejects that claim.
"We don't believe our customers are as naive as the Massachusetts Securities Division paints them to be," Robinhood said in a statement.
Benjamin Pimentel (
@benpimentel) covers fintech from San Francisco. He has reported on many of the biggest tech stories over the past 20 years for the San Francisco Chronicle, Dow Jones MarketWatch and Business Insider, from the dot-com crash, the rise of cloud computing, social networking and AI to the impact of the Great Recession and the COVID crisis on Silicon Valley and beyond. He can be reached at email@example.com or via Signal at (510)731-8429.