Corporate Transparency Act Reporting Remains Voluntary Despite Supreme Court Ruling
January 24, 2025
In the latest Corporate Transparency Act (“CTA”) twist, on January 23, 2025, in the case of James R. McHenry, III, Acting Attorney General, et al., v. Texas Top Cop Shop, Incorporated, et al.,1 the Supreme Court granted the Government’s application for a stay of the nationwide preliminary injunction issued by a court in the Eastern District of Texas. However, a second Texas decision issued on January 7, 2025, Smith et. al. v. United States Department of The Treasury, et. al, remains in place and continues to stay reporting under the regulation.2 Treasury’s Financial Crimes Enforcement Network (“FinCEN”) updated its website on January 24, 2025, to announce that reporting companies are not currently required to file beneficial ownership information (“BOI”) reports and are not subject to liability if they fail to do so while the Smith order remains in force. FinCEN will continue to accept BOI reports submitted voluntarily.
The nationwide injunction was first issued by the Eastern District of Texas in Texas Top Cop Shop, Inc., et al. v. Garland, et al.3 The Fifth Circuit issued the expedited briefing and oral argument schedule below:
- Appellants’ brief is due on 02/07/2025
- Appellees’ brief is due on 02/21/2025
- Appellants’ reply brief is due on 02/28/2025
- Oral arguments will be held on 3/25/2025
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O’Melveny & Myers will continue to provide updates as circumstances evolve. We can help with any questions you may have about the CTA. Feel free to contact our team of experts.
1 James R. McHenry, III, Acting Attorney General, et al., Applicants v. Texas Top Cop Shop, Incorporated, et al., Docket No. 24A653 (604 U.S., Jan. 23, 2025)
2 Smith et. al. v. United States Department of The Treasury et. al., E.D. Tex. Case No. 6:24-cv-00336.
3 Texas Top Cop Shop, Inc. v. Garland, et. al., No. 24-40792, 2024 WL 5203138 (5th Cir. Dec. 23, 2024); Texas Top Cop Shop, Inc., et al. v. Garland, et al., E.D. Tex., Case No. 4:24-cv-00478-ALM; 24-40792.
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