Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-ca8-06-01551/USCOURTS-ca8-06-01551-0/pdf.json

Nature of Suit Code: 690
Nature of Suit: Other Forfeiture and Penalty Suits
Cause of Action: 

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United States Court of Appeals

FOR THE EIGHTH CIRCUIT

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No. 06-1551

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On Target Sporting Goods, Inc., * 

doing business as On Target, * 

* 

Appellant, * 

* Appeal from the United States

v. * District Court for the 

* Eastern District of Missouri.

Attorney General of the United States, * 

United States Department of Justice; * 

Carl J. Truscott, Director, Bureau of * 

Alcohol, Tobacco, Firearms and * 

Explosives; James G. Martin, Acting * 

United States Attorney, Eastern District *

of Missouri, Eastern Division; Bureau * 

of Alcohol, Tobacco & Firearms, * 

* 

Appellees. *

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Submitted: October 18, 2006

Filed: January 4, 2007

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Before SMITH, BOWMAN, and COLLOTON, Circuit Judges.

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SMITH, Circuit Judge.

The Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF) refused to

renew On Target Sporting Goods, Inc.'s ("On Target") federal firearms license after

an inspection revealed multiple violations of the firearm disposition regulations. An

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The Honorable Charles A. Shaw, United States District Judge for the Eastern

District of Missouri.

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The form contained a heading entitled "Required Records" which included the

following subheadings: "Retention of Records"; "ATF Form 4473, Firearms

Transaction Record"; "Bound Book Record (27 CFR 178.125(e))"; and "Report of

Multiple Handgun Sales (27 CFR 178.126(a))." The bottom of the form read: "On this

date, 8/6/96, the above listed information was explained to me by ATF Inspector

Bruce Absheer. I have received a copy of this document for my records. [Signed] Paul

E. Haley."

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ATF hearing officer upheld the agency's determination, and On Target sought judicial

review. The district court1

 granted the government's motion for summary judgment,

concluding as a matter of law that On Target willfully failed to follow the regulations.

We affirm.

I. Background

Paul Haley, On Target's owner, was aware of his general record-keeping and

firearm-tracing responsibilities. Haley had previously owned another business that had

been licensed to sell firearms and completed the ATF inspection process with that

business in 1993. Also, in 1996, Haley was interviewed by an ATF inspector during

a four-hour inspection of On Target. During the inspection, the inspector discussed

firearm laws and regulations with Haley, and Haley signed a form2

 entitled "Review

of Federal Firearm Regulations." 

On April 9, 2002, ATF again inspected On Target's premises and records but

was unable to complete the inspection because On Target had failed to keep its firearm

records current from November 2001 through April 2002. The inspector returned to

On Target on April 16, 2002, June 11, 2002, the week of June 24, 2002, and in

January 2003, to complete the inspection. The inspector noted that On Target could

not account for 51 firearms listed in the company's inventory.

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On September 16, 2003, ATF received an application for renewal of On

Target's federal firearm license. ATF notified On Target that its application had been

denied. On Target then requested an administrative hearing to contest the licensing

decision.

At the hearing, Haley testified that he had located 5 of the 51 missing firearms

since the inspection. However, he could not account for the remaining 46 firearms.

During the hearing, Haley recalled speaking to ATF Inspector Absheer and

acknowledged familiarity with ATF record-keeping requirements, including record

timeliness. The hearing officer also noted that On Target sold firearms to unauthorized

purchasers, including a convicted felon, an alien, someone who did not indicate

whether or not he had previously been adjudged as mentally defective, and someone

whose background check was not completed at the time of the transaction. Haley

admitted that his business "got behind" in documenting transactions from

approximately November 2001 through April 2002.

Following the administrative hearing, the ATF hearing officer upheld the

denial. ATF then issued its final notice of denial. Among other things, the hearing

officer's decision noted that ATF inspections revealed that On Target could not

account for either the identity of the purchaser or the location of at least 46 firearms.

On Target sought judicial review from the district court. In response, ATF filed

a motion for summary judgment, asserting, among other things, that On Target had

no records identifying the purchasers of a large number of firearms. After On Target

failed to respond to the government's summary judgment motion, the district court

deemed all facts set forth in the government's statement of undisputed material facts

admitted because they were not specifically controverted by On Target. The district

court then granted ATF summary judgment, finding that On Target "willfully" failed

to maintain the proper records under 18 U.S.C. § 923(g) and 27 C.F.R. §§ 478.124 and

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478.125. On Target appeals the grant of summary judgment, arguing that the record

was insufficient to establish On Target's noncompliance as a matter of law. 

II. Discussion

Congress has provided that the ATF shall approve a federal firearms dealer's

license unless the applicant has "willfully violated" a statutory or regulatory

requirement for continued licensing. 18 U.S.C. § 923(d)(1)(C). Federal regulations

require firearms dealers, with limited exceptions not applicable here, to properly

record and retain the transaction records for the acquisition and disposal of every

firearm. 27 C.F.R. § 478.124. The purchase or other acquisition of every firearm must

be recorded "not later than the close of the next business day following the date of

such purchase or acquisition." 27 C.F.R. § 478.125(e). The disposition or sale of

firearms must be recorded "not later than 7 days following the date of such

transaction." Id.

It is undisputed that On Target violated these firearm record-keeping

regulations; the issue on appeal is whether the violations were willful. For the

government to prove a willful violation of the federal firearms statutes, it need only

establish that a licensee knew of its legal obligation and "purposefully disregarded or

was plainly indifferent to the recordkeeping requirements." Lewin v. Blumenthal, 590

F.2d 268, 269 (8th Cir. 1979). The government is not required to show that the

violations occurred with any bad purpose. Id.

After a de novo review of the record, Belde v. Ferguson Enterprises, Inc., 460

F.3d 976, 977 (8th Cir. 2006) (standard of review), we agree with the district court

that no genuine issue of material fact exists and that summary judgment was

appropriate. See Fed. R. Civ. P. 56. The administrative hearing disclosed a large

number of violations ranging from On Target's failure to keep proper records on the

acquisition and disposition of firearms to sales of a firearm to someone who had

indicated on their firearm purchase application that he was a convicted felon. Haley,

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On Target's owner, confirmed under oath that ATF inspectors had informed him of his

general record-keeping and firearm tracing duties. Haley also admitted that he had

fallen behind in his record-keeping responsibilities and had not met the firearms

recording requirements.

Given the uncontroverted evidence demonstrating On Target's awareness of the

legal record-keeping requirements and its repeated failure to follow them, we

conclude that the record evidence sufficiently established that On Target was plainly

indifferent to the requirements of the law. See Lewin, 590 F.2d at 269. Based on our

reading of the record, there was substantial evidence to justify the determination that

On Target's violations were willful. ATF was therefore justified in its refusal to renew

On Target's license. See id.

III. Conclusion

Accordingly, the judgment of the district court is affirmed.

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