Injunction Suspends Enforcement of CTA
By: Blair R. Vandivier and John L. Egloff
Please be aware that on December 3, 2024, the United States District Court for the Eastern District of Texas entered a nationwide preliminary injunction suspending (temporarily) the enforcement of the Corporate Transparency Act. The attorneys at Riley Bennett Egloff LLP are carefully monitoring this development. It is expected that the Federal Government will seek an expedited appeal of this decision, in an effort to stay the District Court’s order.
Because of the uncertainty of the situation, we recommend that reporting companies who have not yet filed an initial beneficial ownership report remain prepared to do so by the January 1, 2025 filing deadline. Should the injunction be lifted prior to that January 1, 2025 deadline, the obligation to file would be immediately reinstated – absent an extension by the Financial Crimes Enforcement Network (FinCEN). Alternatively, if the injunction is lifted after January 1, 2025, we do not believe FinCEN would lawfully penalize anyone who failed to file by that deadline. Presumably, in that situation, a prompt obligation to file would be required.
Although FinCEN has not yet issued any public statements about this decision, we do expect further guidance from FinCEN in relation to this injunction. If and when our recommendation on this matter changes, we will provide an update.
The attorneys at Riley Bennett Egloff continue to follow the development of CTA. If you have questions as to whether your company qualifies for an exemption under CTA, if you need help in completing the BOI Report (including identifying your “beneficial owners”), or if you have any other questions regarding the CTA, please contact us and we will be happy to assist you.
Blair R. Vandivier, Of Counsel
Blair Vandivier is a business lawyer who is also the owner and operator of successful small and mid-sized businesses. In addition to operating these businesses, Blair serves as outside counsel to a number of similarly sized entities. Blair brings a unique perspective to the role of the lawyer as a result of spending a significant amount of his time in the shoes of the business owner and manager.
Blair provides general business counsel to his clients in the manufacturing, service, and construction industries on such issues as the choice and formation of the entity, relationships of the equity owners, financing the growth and maintenance of the enterprise, acquisition and divestiture, real estate sales and leasing, as well as numerous related matters.
John L. Egloff, Partner
John Egloff serves as trusted legal counsel for scores of local, regional and national businesses, providing a full range of legal services with respect to their operational and transactional needs. John’s more than 40 years of experience as a business attorney includes the formation, acquisition, sale, and merger of business entities large and small, and the negotiation, drafting and/or review of virtually every type of business agreement and business-related documentation, including real estate and equipment leases and purchase agreements; financing documents (loan agreements, notes and mortgages); private placement memoranda; employment agreements (including non-competition agreements); licensing and franchise agreements; dealership and distributorship agreements; and routine customer and vendor documents (such as purchase order forms and warranty documentation).
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Posted December 6, 2024, by Blair R. Vandivier and John L. Egloff.