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In the latest update to the Corporate Transparency Act saga, the United States Supreme Court has granted an application for a stay of the injunction issued by Judge Amos Mazzant of the United States District Court for the Eastern District of Texas in Texas Top Cop Shop, Inc. v. Garland. This action was taken upon request of the applicants (Attorney General Merrick Garland, Treasury Secretary Janet Yellen, FinCEN, and FinCEN Director Andrea Gacki), which was filed on December 31, 2024. On January 23rd, the Supreme Court granted the application for stay of the injunction, pending disposition of the appeal in the Fifth Circuit.
Due to a separate order issued on January 7th by Judge Jeremy Kernodle, another judge in the Eastern District of Texas, enforcement of the beneficial ownership information (BOI) Reporting Rule appears to still be on hold. In that case (Smith v. U.S. Dept. of the Treasury), Judge Kernodle’s order (i) enjoined the Department from enforcing the CTA against the plaintiffs and (ii) stayed the effective date of the BOI Reporting Rule.
On January 24th, FinCEN issued a statement on its website confirming that since the nationwide order issued in Smith remains in place, reporting companies are not currently required to file BOI reports and are not subject to liability if they fail to report while the Smith order remains in force. Reporting companies may continue to voluntarily submit BOI reports.
The Texas Top Cop Shop case is set for oral argument on March 25, 2025. No appeal has been filed by the Government in Smith to date.