Phoenix (December 30, 2024) –
By an order dated December 26, 2024, the United States Fifth Circuit Court of Appeals has reinstated the nationwide injunction blocking enforcement of the Corporate Transparency Act (CTA). In doing so, the Court reversed its December 23, 2024, decision that had lifted the injunction imposed by the United States District Court in the case of Texas Top Cop Shop v. Garland.
This means that the preliminary injunction issued on December 3, 2024, is again in place and enjoins the CTA along with enforcement of the Reporting Rule issued under the CTA, and stays the compliance deadline of January 1, 2025, for filing a Beneficial Ownership Information Report (“BOIR”) so that reporting companies need not comply with that deadline pending further order of the Court.
As JKW previously reported, the preliminary injunction is subject to being vacated by either the District Court, the Fifth Circuit Court of Appeals, or the United States Supreme Court. The injunction does not prohibit voluntary compliance with the CTA. If a company which would be required to file a BOIR chooses not to do so in reliance on the preliminary injunction, it may nonetheless take steps to be prepared to file a BOIR on short notice in the event the preliminary injunction is vacated or overturned on appeal. In the meantime, any company which chooses not to file should continue to monitor developments with respect to the injunction and course of the appeal currently pending before the Fifth Circuit Court of Appeals.
