In rapid fashion, the Fifth U.S. Circuit Court of Appeals has reinstated a nationwide injunction that had been issued earlier this month by a federal judge in Texas that concluded the Corporate Transparency Act (CTA) was likely to be found unconstitutional. The Financial Crimes Enforcement Network (FinCEN), that is charged with overseeing the CTA reporting requirements, has yet to put out a response to this latest halt of beneficial ownership information (BOI) reporting requirements.
As discussed in a prior alert, on December 23, 2024, a motions panel of the Fifth Circuit Court granted the Federal government’s emergency motion for a stay of the nationwide injunction pending appeal, resulting in reporting companies being obligated to file their BOI reports by their applicable deadline as well as FinCEN issuing extensions for the deadlines. With this latest ruling, submitting BOI reports again becomes optional, for the time being, as this matter continues to play out in the court system.
The appeal has been expedited to the Fifth Circuit Court’s next available oral argument panel. We will continue to provide updates.
Gordon W. Prince is a business law attorney who joined Gawthrop Greenwood, PC shortly after graduating number one in his class at Widener University Delaware Law School. He focuses his practice in the firm’s Business Law Department and supports a broad range of transactional and general business entity matters including business formation, the drafting and negotiation of contracts and merger agreements, business compliance with state and federal law, and real estate and corporate governance. He is particularly attuned to the needs of local businesses, supporting mid-sized business clients with his authorship of Gawthrop Greenwood’s Guide to Buying and Selling a Business.
With offices in West Chester, Berwyn and Center City Philadelphia, PA and Greater Wilmington, DE, Gawthrop Greenwood serves clients throughout the greater Mid-Atlantic region and nation.
