Opinion ID: 873575
Heading Depth: 1
Heading Rank: 1

Heading: Regulatory/Factual Background

Text: The Gun Control Act of 1968, Pub. L. No. 90-618, 82 Stat. 1213 (codified as amended at 18 U.S.C. §§ 921 et seq.) (GCA), requires anyone who wishes to “engage in the business of . . . dealing in firearms” to obtain a license from ATF. 18 U.S.C. § 923(a).1 Licensees are known as FFLs and must comply with various provisions of the GCA, including recordkeeping requirements. See id. § 923(g). In 1968, the United States Department of the Treasury2 promulgated regulations to implement certain GCA recordkeeping requirements. RSM, Inc. v. Buckles, 254 F.3d 61, 64 (4th Cir. 2001). One requirement provided that an FFL “shall, when required by letter issued by [the Department of the Treasury], and until notified to the contrary . . . submit on Form 4483, Report of Firearms Transactions, for the periods and at the times specified in the letter . . . all record information required by this subpart, or such lesser record information as the . . . letter may specify.” 27 C.F.R. § 178.126(a) (1986). In 1986, the Congress amended the GCA via the Firearm Owners’ Protection Act, Pub. L. No. 99-308, 100 Stat. 449 (1986) (FOPA). FOPA “was intended to reduce the regulatory burden on law-abiding firearms owners without incapacitating 1 Unless otherwise noted, all citations to statutes or regulations are to the most recent version. 2 “The GCA originally granted the Secretary of the Treasury the authority to issue licenses. The Secretary delegated this authority to [ATF]. As part of the Homeland Security Act of 2002, the licensing authority was transferred to the Department of Justice. The Attorney General of the United States, in turn, delegated the licensing authority to the newly reconfigured Bureau.” Blaustein & Reich, Inc. v. Buckles, 365 F.3d 281, 283 n.3 (4th Cir. 2004) (citation omitted), cert. denied, 543 U.S. 1052 (2005). 4 [ ]ATF’s ability to combat violations of the firearms laws.” RSM, 254 F.3d at 64. FOPA authorized the Attorney General to promulgate implementing rules3 but expressly prohibited any rule establishing a firearms registry of any kind maintained by “the United States or any State or any political subdivision thereof.” 18 U.S.C. § 926(a).4 In February 2008, William Hoover (Hoover), the ATF Assistant Director for Field Operations, testified before a subcommittee of the United States House of Representatives regarding an “increased incidence of firearms trafficking to Mexico” from the United States, which “facilitate[d] the drug trade” and threatened safety “on both sides of the border.” Statement of William Hoover, Assistant Director for Field Operations of ATF Before the U.S. House of Representatives Committee on Foreign Affairs Subcommittee on the W. Hemisphere (Feb. 7, 2008) (Joint Appendix (JA) 529-30), available at http://www.atf.gov/press/releases/2008/02/ 020708-testimony-atf-ad-hoover-sw-border.html. Hoover explained that, while criminals had previously used .38 caliber handguns as their “weapon[ ] of choice,” they were developing a preference for “higher quality, more powerful weapons” such as the Colt AR-15 .223 caliber assault rifle and the AK-47 7.62mm caliber assault rifle. Id. (JA 531). Hoover believed that ATF could best combat the trafficking by developing better intelligence, but noted that ATF had difficulty obtaining such intelligence because it was difficult to “trace” firearms recovered in Mexico. See id. JA 531-32. 3 FOPA also codified at least one existing rule, 27 C.F.R. § 178.126(a) (1986), in the provisions of 18 U.S.C. § 923(g)(5)(a), quoted infra at Part II.A. 4 FOPA preserves the Attorney General’s “authority to inquire into the disposition of any firearm in the course of a criminal investigation.” 18 U.S.C. § 926(a). 5 Tracing entails “tracking the movement of a firearm involved in a crime from its first sale by the manufacturer or importer through the distribution chain to the non-licensed purchaser.” Decl. of Arthur Herbert ¶ 5, Nat’l Shooting Sports Found., Inc. v. Jones, No. 11-1401 (D.D.C. Sept. 23, 2011) (JA 43). Law enforcement agencies use tracing “to link a suspect to a firearm in a criminal investigation; to identify potential traffickers; and to detect patterns in the sources and kinds of firearms that are used in crime.” Id. In other words, tracing serves as a valuable tool for investigating drug crimes. Id. ¶ 7 (JA 44). Tracing begins when a law enforcement officer recovers a firearm used in a crime and makes a “trace request” by entering the firearm’s identifying information— e.g., serial number, caliber, make and model—into a database called the “ATF Firearms Tracing System.” Id. ¶ 6 (JA 44). ATF compares the identifying information to other firearms transactions records to “determine[ ] the firearm’s entry point into U.S. commerce and its path through the distribution chain.” Id. ¶ 7 (JA 44); see also id. ¶¶ 7-10, 39-42 (JA 44-45, 52-53). Because FOPA limits ATF’s ability to collect and maintain firearms transactions records, however, most of the records are kept by individual FFLs and not routinely provided to ATF. See, e.g., J&G Sales Ltd. v. Truscott, 473 F.3d 1043, 1045 (9th Cir.) (“Rather than submitting all of their transaction records to the Bureau, FFLs keep their records on their own premises. . . . in part because [FOPA] . . . . ban[s] . . . creating a centralized registration system . . . . ”), cert. denied, 552 U.S. 887 (2007); see also Decl. of Arthur Herbert ¶ 8 (JA 44-45) (“[An FFL’s] records are not routinely provided to ATF . . . . ”). Therefore, ATF often “relies upon FFL records when it seeks to trace a firearm.” J&G Sales, 473 F.3d at 1045. Specifically, ATF “must contact the manufacturer(s) or importer, then the wholesaler, and then the [FFL], who then provides [within twenty-four hours, see 18 U.S.C. § 923(g)(7)] information about to whom the firearm 6 was sold.” Decl. of Arthur Herbert ¶ 40 (JA 52). Tracing typically takes “ten to twelve days on average to complete.” Id. The GCA permits ATF to maintain records of firearms transactions in certain circumstances. For example, if an FFL goes out of business, the GCA generally requires that the FFL deliver his records to ATF.5 18 U.S.C. § 923(g)(4). The GCA further requires that an FFL report to ATF sales of two or more “pistols, or revolvers, or any combination of pistols and revolvers” to the same buyer within five business days; the report is due by the close of business on the day the multiple sale occurs. Id. § 923(g)(3)(A). Additionally, the GCA permits ATF to send demand letters to FFLs to obtain “record information” therein specified. Id. § 923(g)(5)(A). If ATF is able to match a trace request with the records it maintains, it can complete a trace request more quickly. See Decl. of Arthur Herbert ¶¶ 39, 41-42 (JA 52-53). For example, “[m]ultiple sales reports [of handguns pursuant to 18 U.S.C. § 923(g)(3)(A)] are entered into ATF’s Firearms Tracing System . . . . When a firearm is traced, it is checked against these reports. A match expedites tracing because ATF does not need to contact all active FFLs in the distribution chain (e.g., manufacturers and distributors), but instead only needs to contact the retail dealer.” Id. ¶ 41 (JA 52-53). Therefore, when ATF conducts a trace pertaining to records in its own possession, it can generate more timely and valuable investigative leads for law enforcement. Id. ¶¶ 42-45 (JA 5354). 5 An FFL going out of business does not deliver his records to ATF if (1) he is succeeded by a new FFL; or (2) “where State law or local ordinance requires the delivery of records to other [sic] responsible authority.” 18 U.S.C. § 923(g)(4). 7 As noted, ATF struggles to trace firearms recovered from gun trafficking operations into Mexico. Specifically, Mexican cartels have made long guns (i.e. rifles and shotguns) their new “weapons of choice.” U.S. DEP’T OF JUSTICE, OFFICE OF THE INSPECTOR GEN., REVIEW OF ATF’S PROJECT GUNRUNNER iv (Nov. 2010) (JA 382) (hereinafter OIG REPORT). Because—unlike multiple sales of pistols—there is no requirement that an FFL report multiple sales of long guns, however, ATF usually cannot use its own records to conduct a trace request involving Mexican gun trafficking. See id. (JA 382); U.S. GOV’T ACCOUNTABILITY OFFICE, FIREARMS TRAFFICKING: U.S. EFFORTS TO COMBAT ARMS TRAFFICKING TO MEXICO FACE PLANNING AND COORDINATION CHALLENGES 28 (June 2009) (JA 582) (hereinafter GAO REPORT). Thus, a June 2009 report prepared by the Government Accountability Office (GAO) regarding Mexican arms trafficking recommended that ATF investigate “approaches to address the challenges law enforcement officials raised in this report regarding the constraints on the collection of data that inhibit the ability of law enforcement to conduct timely investigations.” GAO REPORT at 59 (JA 613). Similarly, a May 2010 report by the Office of the Inspector General (OIG) of the United States Department of Justice found, inter alia, “the lack of a reporting requirement for multiple sales of long guns . . . hinders ATF’s ability to disrupt the flow of illegal weapons into Mexico.” OIG REPORT at iv (JA 382). The OIG report explained that (1) “the percentage of crime guns recovered in Mexico that were long guns steadily increased each year from 20 percent in FY 2004 to 48 percent in FY 2009,” id. at 38 (JA 428); (2) “long guns tend to have a shorter time-to-crime than handguns, and shorter time-to-crime intervals generate more valuable leads for ATF,” id.; and (3) “Mexican cartels are obtaining long guns in multiple sales,” id. It concluded that “mandatory reporting of long gun multiple sales could help ATF identify, 8 investigate, and refer for prosecution individuals who illegally traffic long guns into Mexico,” id. at 39-40 (JA 429-30), and recommended that ATF “explore options for seeking a requirement for reporting multiple sales of long guns,” id. at 40, 94 (JA 430, 484). ATF responded that it “would explore the full range of options” but that some options “may require a change to the Gun Control Act.” Id. at 127 (JA 517). On December 17, 2010, ATF announced a proposed information collection program requiring each FFL to “report multiple sales or other dispositions whenever the [FFL] sells or otherwise disposes of two or more rifles within any five consecutive business days with the following characteristics: (a) [s]emi automatic; (b) a caliber greater than .22; and (c) the ability to accept a detachable magazine.” Agency Information Collection Activities: Proposed Collection, 75 Fed. Reg. 79,021, 79,021 (Dec. 17, 2010). After a sixty-day comment period, ATF received 12,680 comments (8,928 in support and 3,752 in opposition). Agency Information Collection Activities; Proposed Collection Comments Requested: Report of Multiple Sale or Other Disposition of Certain Rifles, 76 Fed. Reg. 24,058, 24,058 (Apr. 29, 2011). ATF subsequently extended the comment period for an additional thirty days and clarified that the multiple-reporting requirement applied only to FFLs classified as licensed “dealers and/or pawnbrokers” located in Arizona, California, New Mexico and Texas. Id. Accordingly, in July 2011, ATF sent a demand letter to each FFL classified as a “licensed dealer[ or] pawnbroker[ ]”6 6 There are eleven categories of FFLs. See United States Department of Justice, The Bureau of Alcohol, Tobacco, Firearms and Explosives, ATF Online—Statistics—Listing of Federal Firearms Licensees, http://www.atf.gov/about/foia/ffl-list.html. Type 01 is a dealer in firearms other than destructive devices. Id. Type 02 is a pawnbroker in firearms other than destructive devices. 9 and located “in Arizona, California, New Mexico and Texas.” Letter from Charles Houser, Chief, Nat’l Tracing Ctr., to Fed. Firearms Licensees 1 (Jul. 12, 2011) (JA 32) (hereinafter July 2011 Demand Letter). The demand letter stated in pertinent part: You must submit to the Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF) reports of multiple sales or other dispositions whenever, at one time or during any five consecutive business days, you sell or otherwise dispose of two or more semi-automatic rifles capable of accepting a detachable magazine and with a caliber greater than .22 (including .223/5.56 caliber) to an unlicensed person. You are required to report all such sales that occur on or after August 14, 2011. You must continue reporting multiple sales for the rifles subject to this demand letter until we provide written notice to stop. The required information must be submitted on ATF Form 3310.12, Report of Multiple Sale or Other Disposition of Certain Rifles, no later than the close of business on the day the multiple sale or other disposition takes place. Id. National Shooting Sports Foundation, J&G Sales and Foothills Firearms filed separate actions against ATF on August 3, 2011, and the district court subsequently consolidated them, Order Consolidating Cases, Nat’l Shooting Sports Found., Inc. v. Jones, 11-cv-1401 (Aug. 18, 2011). NSSF sought, inter alia, to enjoin ATF from requiring the Id. The July 2011 demand letter is directed to Type 01 and Type 02 FFLs. 10 submission of the information requested by the demand letter and to require ATF to destroy any information already submitted. Nat’l Shooting Sports Found., Inc. v. Jones, 840 F. Supp. 2d 310, 312 (D.D.C. 2012). On January 13, 2012, the district court granted ATF’s motion for summary judgment and denied NSSF’s cross-motions for summary judgment. Id. at 323. NSSF timely appealed. Our jurisdiction arises under 28 U.S.C. § 1291.