Melissa Wiley was quoted in a Thomson Reuters article titled “Oregon Plaintiffs Oppose ‘Stay’ in Corporate Transparency Act Case.”
The article discusses the Trump administration’s push to pause litigation challenging the Corporate Transparency Act (CTA) and its beneficial ownership information reporting requirements, and the pushback coming from the plaintiffs in the Firestone v. Bessent case in the Ninth Circuit.
The CTA went into effect on January 1, 2024, requiring beneficial ownership reporting for an expected 30 million+ companies formed or registered to do business in the United States. But even before the law went into effect, several lawsuits were filed that challenged the beneficial ownership reporting mandates as unconstitutional. As a result, Treasury’s Financial Crimes Enforcement Network (FinCEN) pushed back the date for compliance, and courts began to issue conflicting guidance on the law’s constitutionality. In the midst of this uncertainty, the Treasury Department announced on March 2, 2025, that they were suspending enforcement of the CTA against U.S. citizens and domestic companies and planning to issue proposed regulations narrowing the scope of the law just to foreign entities. The interim final rule adopting these restrictions was issued on March 26, 2025.
As Reuters reported, the March 2025 announcement and interim final rule “left in question the fate of cases pending around the country — including in the 4th, 5th, 9th, and 11th Circuit Courts of Appeal — that challenged the previous, broader reporting rule. Treasury most recently has moved to hold proceedings in some of those cases in abeyance, arguing that the plaintiffs’ claims may be mooted by a final rule.”
But as Melissa notes in the article, “The interim final rule is just that: an interim rule, and one that can be changed at any point in time, so long as it is consistent with the (broad) language of the statute and is promulgated consistent with the Administrative Procedures Act.”
While some plaintiffs who challenged the original law agreed with Treasury that their case should be held in abeyance, Firestone‘s plaintiffs want their case against the CTA to continue. The plaintiffs include several Oregon small business owners, and they are seeking an indefinite stay on the law because the interim final rule, they argue, “merely delays, rather than eliminates, domestic enforcement of the CTA,” according to Reuters. The plaintiffs are concerned that enforcement could resume as the government solicits comments on the rule change.
As Melissa said in the article, “If you believe there’s a defect in the statute, there’s always going to be a risk that it could be applied unconstitutionally in the future, even if the present enforcement is in line with what the plaintiffs believe is permissible.”
You can read the full story on the current litigation against CTA reporting requirements here.
