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ATF Rule Curbing Unlicensed Gun Dealing Takes Effect in 49 of 50 States, Single Federal Judge Issues Flawed and Dangerous Decision Halting Rule in Texas


Texas Judge Partially and Temporarily Restrains“Engaged in the Business Rule,” Which Clarifies that Private Commercial Gun Sellers Must Conduct Background Checks as Intended by  Congress

NEW YORK – The Bureau of Alcohol, Tobacco, Firearms and Explosives’ (ATF) life-saving rule requiring those engaged in the business of selling guns to become licensed firearms dealers and, in turn, run background checks on their customers took effect in 49 states this morning.

Yesterday, U.S. District Court for the Northern District of Texas Judge Matthew Joseph Kacsmaryk partially and temporarily froze the rule, preventing the ATF from enforcing it against Texas. A small handful of gun rights organizations are also temporarily exempt. The rule will otherwise take effect today, Monday, May 20. 

Everytown Law, the nation’s largest and most experienced team of gun violence prevention litigators, released the following statement in response to Kacsmaryk’s decision.

“The District Court’s decision to prevent ATF’s ‘Engaged in the Business Rule’ from taking full and immediate effect everywhere is not only deeply flawed, it’s also dangerous, and will put communities and law enforcement at greater risk of gun violence,” said Eric Tirschwell, Executive Director of Everytown Law. “Congress was clear: those engaged in the business of selling firearms need to be licensed and need to conduct background checks.  The Rule implements that common sense mandate and we will continue to vigorously defend it as these meritless challenges by the gun lobby and its allies make their way through the federal courts.”

For years, unlicensed gun sellers have been able to exploit loopholes to avoid conducting background checks on guns sold to customers, including online and at gun shows. In 2022, with the landmark Bipartisan Safer Communities Act (BSCA), Congress gave the Biden-Harris Administration the tools to help close these loopholes by revising the statutory definition for “engaged in the business” of dealing in firearms.

In April, the Department of Justice and ATF finalized a new rule implementing BSCA’s expansion of firearm background checks. Among other things, ATF’s new rule implements the changes that Congress made on a bipartisan basis in BSCA to make it clear which unlicensed gun sellers — including those who sell guns online or at gun shows — are “engaged in the business” of dealing in firearms and need to become licensed dealers and run background checks.

On May 1, Republican Attorneys General across 26 states filed three lawsuits to challenge the rule, including the challenge in the Northern District of Texas. As a group, the states named have weaker gun safety laws and higher rates of gun violence than the rest of the country. 

Just this week, four of the nation’s leading gun violence prevention organizations – Everytown for Gun Safety Support Fund, Brady Center to Prevent Gun Violence, GIFFORDS Law Center and March For Our Lives – filed joint amicus briefs in support of the ATF rule. According to Judge Kacsmaryk’s ruling in Texas, et al. v. ATF, et al., the ATF is temporarily prohibited from enforcing the rule against Texas and certain gun rights groups for two weeks, through June 2, 2024. Judge Kacsmaryk found that Louisiana, Mississippi, and Utah do not get the same relief. Additional challenges to the ATF rule are pending in federal courts in Arkansas and Florida.