Unreported / Non-Citable
Background
The National Firearms Act historically imposed transfer and making taxes on specified firearms and supported those taxes with registration, application, recordkeeping, identification, and approval requirements. In 2025, however, Congress amended the NFA to set the transfer and making taxes at $0 for short-barreled shotguns, short-barreled rifles, silencers, and firearms classified as “any other weapon,” effective January 1, 2026. Congress retained the associated regulatory requirements and left taxes on machineguns and destructive devices unchanged.
A coalition of individuals, firearms businesses, associations, and 15 states challenged the remaining regulations under Congress’s Article I enumerated powers and the Second Amendment. The court consolidated their case with Jensen v. ATF, a related action presenting substantially similar claims, and considered cross-motions for summary judgment.
The Court’s Holding
The court held that the challenged NFA provisions exceed Congress’s enumerated powers as applied to the four categories of firearms whose transfer and making taxes Congress reduced to zero. Because those transactions no longer produce tax revenue, the regulatory provisions could not be sustained as measures aiding the collection or enforcement of a tax. The court also concluded that the provisions could not be retroactively justified under the Commerce Clause because the NFA’s text, structure, and statutory history showed that Congress enacted them under the taxing power rather than its authority to regulate interstate commerce.
The court granted the plaintiffs summary judgment in part and permanently enjoined the federal defendants from enforcing the challenged provisions against the plaintiffs and, where applicable, their agencies, political subdivisions, members, and current and future customers. It rejected a universal injunction, declined declaratory relief as redundant, and did not reach the Second Amendment claims. The Jensen plaintiffs received no relief concerning “any other weapon” firearms because they lacked standing to challenge that category, although they obtained relief from two additional marking-related provisions they had challenged.
Key Takeaways
- After Congress reduced the relevant NFA transfer and making taxes to zero, the court found that the associated regulations could no longer be sustained under the taxing power.
- The court refused to uphold the provisions under the Commerce Clause because it found no indication that Congress invoked that power when enacting the challenged NFA scheme.
- The injunction is party-specific, extends in defined circumstances to members and customers, and does not protect the public generally.
Why It Matters
The decision prevents ATF and the Justice Department from enforcing significant NFA registration and approval requirements for untaxed firearms against the covered plaintiffs and affiliated parties. It does not invalidate the NFA’s continuing taxes and regulations for machineguns or destructive devices, and its injunction is not nationwide.
The ruling also illustrates the constitutional consequences the court attributed to Congress’s decision to retain a tax-based regulatory scheme after eliminating the underlying taxes. The order was stayed for seven days to permit the defendants to seek appellate relief.