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UPDATE 1-Business groups sue SEC over Dodd-Frank anti-bribery rule

* Chamber, API say SEC failed to weigh costs/benefits

* SEC rule was required by Dodd-Frank law

* Rule requires companies to disclose payments to govts

* Attorney Scalia to argue the case for the industry

* SEC says its economic analysis is sound

(Adds SEC comments, details of the suit and background)

By Sarah N. Lynch

WASHINGTON, Oct 10 (Reuters) - Four business groups onWednesday filed a lawsuit against the Securities and ExchangeCommission's new rule requiring oil, mining and gas companies todisclose payments they make to foreign governments.

In the latest legal challenge to a rule required by the 2010Dodd-Frank Wall Street reform law, the groups including theChamber of Commerce and the American Petroleum Institute allegethat the SEC failed to properly weigh the rule's costs andbenefits.

The suit also claims that the SEC "grossly misinterpretedits statutory mandate" in how it crafted the rule, and in doingso created a regulation that violates companies' First Amendmentrights.

SEC spokesman John Nester said the agency is still reviewingthe lawsuit, but the agency believes it is on solid legalfooting.

"We believe our legal interpretation and economic analysisare sound and we look forward to defending the rule thatCongress directed us to write," Nester said.

The challenge to the SEC's rule is being headed up by GibsonDunn attorney Eugene Scalia, the son of Supreme Court JusticeAntonin Scalia who has a winning-streak in knocking down otherSEC regulations such as the proxy access rule last year.

Late last month, Scalia helped other trade groups win acourt battle against the Commodity Futures Trading Commissionover another Dodd-Frank rule that would have imposed tradingcurbs on speculators.

The SEC's resource extraction rule has been among some ofthe most controversial Dodd-Frank requirements.

Championed by humanitarian organizations, the rule aims tocombat bribery abroad by U.S. energy companies.

But industry groups have argued the rule is far too costlyand would give rivals sensitive business information.

The SEC adopted the rule in August.

The other two groups to challenge the rule on Wednesday werethe Independent Petroleum Association of America and theNational Foreign Trade Council.

(Reporting By Sarah N. Lynch; additional reporting by ArunaViswanatha; Editing by Bernard Orr)

((sarah.n.lynch@thomsonreuters.com)(202-354-5831))

Keywords: SEC/LAWSUIT