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Beneficial Ownership Information Reporting Still on Hold Despite Supreme Court Lifting Injunction on Corporate Transparency Act

Published on

January 24, 2025

UPDATE: On March 21, 2025, the Financial Crimes Enforcement Network issued an Interim Final Rule removing Beneficial Ownership Information Reporting requirements for U.S. companies and U.S. individuals under the Corporate Transparency Act. For more details, please view our latest alert here.

On January 23, 2025, the Supreme Court of the United States (“SCOTUS”) granted a stay reversing the nationwide preliminary injunction which had temporarily halted enforcement of the Corporate Transparency Act (the “Act”) in Texas Top Cop Shop, Inc., et al. v. McHenry, et al., No. 4:24-cv-00478 (E.D. Tex.) (formerly Texas Top Cop Shop, Inc., et al. v. Garland, et al.). As a result, it initially appeared that Reporting Companies, as defined by the Act, would be required to file Beneficial Ownership Information Reports (“BOIRs”) again. 

However, a separate nationwide injunction halting filing of BOIRs pursuant to the Act issued by a different federal judge in another Texas case, Smith v. Dep’t of the Treasury, E.D. Tex., No. 6:24-cv-00336, 1/8/25, still remains in place and, as a result, the Act’s enforcement is still on hold. Earlier today on January 24, the Department of Treasury’s Financial Crimes Enforcement Network (“FinCEN”) stated that, given the injunction in Smith, Reporting Companies are not currently required to file BOIRs.

The January 23, 2025 order of SCOTUS is the fourth decision in Texas Top Cop Shop regarding enforcement of the Act since December 3, 2024. As covered in our recent Alert, on December 3, 2024, a Texas District Court’s injunction temporarily suspended compliance requirements under the Act, which required existing Reporting Companies to file BOIRs on or before January 1, 2025. SCOTUS’ decision follows an application by FinCEN on December 31, 2024 requesting a stay of the injunction issued by the Texas District Court, which had been temporarily stayed, and later reversed, by the United States Court of Appeals for the Fifth Circuit (the “Fifth Circuit”). 

The Fifth Circuit is scheduled to hear oral arguments on the merits of FinCEN’s appeal and the constitutionality of the Act in Texas Top Cop Shop on March 25, 2025. As of the time of this Alert, the Smith case has not yet been appealed to the Fifth Circuit. While the Smith injunction remains in place, the Act’s enforcement will remain on hold.   

Barley Snyder will continue to follow the Act and guidance provided by FinCEN closely, and will provide timely updates as new information is released. If you have any questions regarding this decision or the Act generally, please contact Dan DesmondCharmaine NymanCaitlin Long, or any member of Barley Snyder’s Business Practice Group. You may also visit our Corporate Transparency Act Response Team webpage for more information and previous alerts on this matter. 


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