Texas company sues DOJ over ATF's new "ghost gun" rule

AP Photo/J. Scott Applewhite

In what is likely just the first of several lawsuits challenging the legality of the ATF’s new rule on unfinished frames and receivers, which is scheduled to go into effect in August, a Texas company that makes 80% receivers is asserting that the Department of Justice and the ATF are engaged in an “unlawful attempt to unilaterally rewrite federal law and destroy the ability of Americans to exercise their Second Amendment rights by privately making firearms.”

Division 80, which is based in Galveston County, has engaged some heavy legal artillery in its suit, including former ATF acting director Michael Sullivan, who argues that the changes the Department of Justice is trying to make should take place via a vote in Congress, not an executive branch rule change.

Sullivan, who lives in Boston, and Austin-based co-counsel Cory Liu, who previously worked as assistant general counsel to Gov. Greg Abbott and as a law clerk to Sen. Ted Cruz, said in a joint statement the aim of this suit is “to prevent the Biden Administration from politically weaponizing the ATF and adopting an unlawful (regulation, known as the) Final Rule without Congress’s approval.” The company thinks the new regulation “unlawfully seeks to put law-abiding American companies like Division 80 out of business.”

… The lawsuit highlights what the company sees as the White House’s backdoor solution to this policy conundrum — businesses like Division 80 were forced by the Biden’s Justice Department and ATF to heed a revised federal regulation that limits their rights. The company says this new rule “unlawfully rewrites federal law and repudiates ATF’s longstanding legal position on receiver blanks.”

Businesses were forced to comply with the new mandate that the former classifications of these parts are no longer “valid or authoritative,” despite the fact that no law prevents them from operating, the company says.

“Frustrated with the constitutional process of bicameralism and presentment, President Biden politically pressured (the Justice Department and ATF) to take unilateral executive action to accomplish his failed policy agenda,” the suit says.

You can read a copy of the complaint here, but the gist of the argument is pretty simple; DOJ and ATF are acting beyond their legal purview because, with the votes not there in Congress, that’s the only way that the Biden administration can implement its anti-Second Amendment agenda. The lawsuit notes that for decades the ATF had determined that only completed frames and receivers were considered “firearms” under the language of the Gun Control Act of 1968, but the new rule upended that determination by suddenly declaring that if an incomplete frame or receiver is “designed to or may readily be completed, assembled, restored, or otherwise converted” into a completed frame or receiver then it should be treated like one from the get-go. As the lawsuit points out, this doesn’t make any sense at all, and completely undercuts the position the agency has taken for many years.

If item A can readily be made into item B, it is by definition not yet item B. The Final Rule abuses the English language in order to expand ATF’s regulatory jurisdiction to cover materials that can “readily” be made into regulated products. This attempt to drastically expand ATF’s regulatory jurisdiction is in excess of ATF’s statutory authority.

In classification determinations issued to manufacturers, ATF has stated that receiver blanks do not meet the definition of a regulated “firearm” under federal law. ATF has defended these classification determinations in litigation brought by gun-control activists. But the Final Rule expressly repudiates ATF’s prior classification determinations:

Prior determinations by the Director that a partially complete, disassembled, or nonfunctional frame or receiver, including a parts kit, was not, or did not include, a “firearm frame or receiver” under § 478.11, or “frame or receiver” under § 479.11, as those terms were defined prior to April 26, 2022, shall not continue to be valid or authoritative after that date. Such determinations shall include those in which the Director determined that the item or parts kit had not yet reached a stage of manufacture to be, or include, a “firearm frame or receiver” under § 478.11, or “frame or receiver” under § 479.11, as those terms were defined prior to [April 26, 2022].

ATF’s complete reversal of its legal position is arbitrary, capricious, and an abuse of discretion.

The phrases “partially complete,” “may readily be completed, assembled, restored, or otherwise converted to function as a frame or receiver,” and “stage of manufacture where it is clearly identifiable as an unfinished component part of a weapon” are so vague as to make it impossible for manufacturers, distributors, and customers to understand which product designs are regulated by the Final Rule and which are not. Among other things, this creates extreme uncertainty and will cause prolific waste in determining which facets of the firearms manufacturing supply chain require a federal firearms license. This uncertainty will force companies involved in the supply chain for manufacturing firearms to withdraw from the industry.

Which is exactly the intention of the ATF’s new rule, frankly. In fact, the more uncertainty the better as far as the Biden administration is concerned. Clear bright lines are easy to follow. Vague and fuzzy rules, by their very nature, have a lot of wiggle room for interpretation, and the ATF’s new rule is chock full of vague language that can be interpreted differently on a case by case basis, especially when (quoting from the lawsuit here) it’s “combined with the Final Rule’s authorization of the ATF Director to ‘consider any associated templates, jigs, molds, equipment, tools, instructions, guides, or marketing materials,'”, which the suit argues  “effectively delegate to the ATF Director unbounded, unconstitutional discretion to determine by diktat which products fall within ATF’s jurisdiction.”

As I’ve said before, the Biden administration and their anti-gun allies are trying to weaponize the ATF into a gun control group with law enforcement powers. Second Amendment supporters have already derailed one major component of that campaign by defeating the nomination of gun control lobbyist David Chipman as permanent director of the ATF, and hopefully this lawsuit (and the others that are sure to follow) will derail the administration’s latest attempt to do an end run around the Constitution to attack our Second Amendment rights.