Author: Bailey Glasser

UPDATE: FinCEN Responds to Preliminary Injunction on CTA Enforcement

The preliminary injunction stays all BOI reporting requirement deadlines – for now.

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As we shared in our client alert last week, on December 3, 2024, the U.S. District Court for the Eastern District of Texas issued a nationwide preliminary injunction in Texas Top Cop Shop, Inc., et al. v. Garland, et al., temporarily halting enforcement of the Corporate Transparency Act (“CTA”) and its beneficial ownership information (“BOI”) reporting requirements.

In response, FinCEN announced it will comply with the Court’s order for as long as it remains in effect, noting that during this time reporting companies are not currently required to file BOI reports and will not face penalties for failing to report while the injunction remains in effect. Voluntary submissions, however, are still permitted.

What This Means for You:

No Immediate Filing Requirement: The preliminary injunction stays all BOI reporting requirement deadlines for now. Reporting companies are momentarily relieved of reporting obligations.

Litigation Ongoing: As expected, the Department of Justice filed a Notice of Appeal on behalf of the Department of the Treasury, signaling the government’s intent to challenge the court’s decision. The ultimate status of the injunction and the CTA remains uncertain, pending further court rulings or guidance.

Preparation Still Recommended: While filing is currently paused, reporting companies should nevertheless continue assessing their BOI reporting requirements and gathering necessary information to ensure readiness if the injunction is lifted. FinCEN has not yet provided guidance on how much time reporting companies will be granted to file their BOI reports if the Texas District Court’s injunction is lifted and how quickly enforcement of the CTA would resume.
Next Steps

We advise clients to monitor this matter closely and maintain preparation for potential filing requirements. Our team is actively tracking developments and will provide updates as the matter evolves. To read more on the recent CTA preliminary injunction in Texas Top Cop Shop, Inc., et al. v. Garland, et al., visit here.

If you have specific questions or need assistance with your compliance strategy, please do not hesitate to contact the BG CTA Team:

Lorren Patterson – lpatterson@baileyglasser.com

Paul-Kalvin Collins – pcollins@baileyglasser.com

Japera Parker – jparker@baileyglasser.com

Client Alert: Holiday Surprise: Nationwide Injunction Halts Corporate Transparency Act Enforcement

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Authored by Corporate Practice Group partner Lorren Patterson and corporate attorneys Paul-Kalvin Collins and Japera Parker

Introduction

The Corporate Transparency Act (“CTA”) requires most companies—except for certain exempt entities—to disclose their ownership details to the Financial Crimes Enforcement Network (“FinCEN”). A looming January 1, 2025 reporting deadline for entities formed prior to January 1, 2024 had many companies and compliance departments on edge. But mere weeks before this deadline, a federal court issued a nationwide injunction, preliminarily enjoining the CTA’s enforcement and staying reporting requirements. This temporary relief gives businesses that have yet to submit their information to FinCEN a welcome pause, although this could change rapidly depending on the government’s next steps.

In this article, we break down the outcome of the ruling and explain how it could affect your business, whether you have already filed your information with FinCEN or were preparing to do so by the end of the year.

Texas Federal Court Steps in and Gives a (Temporary) Holiday Gift

On December 3, 2024, in Texas Top Cop Shop, Inc., et al. v. Garland, et al., Case No. 4:24-cv-478 (E.D. Tex.), the U.S. District Court for the Eastern District of Texas issued a nationwide preliminary injunction temporarily prohibiting the enforcement of the CTA and the FinCEN Reporting Rule.

The CTA and Reporting Rule require domestic entities created by the filing of a document with a secretary of state and foreign entities that have registered to do business in the United States (“Reporting Companies”) to file a Beneficial Ownership Information (“BOI”) Report with FinCEN, identifying personal information about the individuals who directly or indirectly own a certain percentage or otherwise control the company, subject to certain exemptions from reporting.

The Court’s decision temporarily halts the CTA’s reporting requirements and enforcement mechanisms for all Reporting Companies across the United States, providing a potential reprieve to approximately 32.6 million entities that were preparing to comply with the January 1, 2025 deadline. Read more.

BG Named to Best Law Firms 2025 List

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Bailey Glasser has been recognized by Best Law Firms® across 45 categories on both nationwide and regional/citywide tiers. Our firm has worked tenaciously on behalf of our clients for 25 years, and we never take your good words for granted. Thank you for recognizing our work for another year.

Below please find a full list of our 2025 rankings.

NATIONAL TIER

Litigation – ERISA (Tier 3)
Mass Tort Litigation / Class Actions – Plaintiffs (Tier 1)
Mergers & Acquisitions Law (Tier 3)
Securities / Capital Markets Law (Tier 3)

METROPOLITAN TIER

Charleston, West Virginia
Banking and Finance Law (Tier 3)
Bankruptcy and Creditor Debtor Rights / Insolvency and Reorganization Law (Tier 3)
Bet-the-Company Litigation (Tier 1)
Commercial Litigation (Tier 1)
Criminal Defense: White-Collar (Tier 1)
Energy Law (Tier 2)
Insurance Law (Tier 2)
Litigation – Banking & Finance (Tier 1)
Litigation – Bankruptcy (Tier 1)
Litigation – Insurance (Tier 1)
Litigation – Labor and Employment (Tier 1)
Mass Tort Litigation / Class Actions – Plaintiffs (Tier 1)
Personal Injury Litigation – Defendants (Tier 1)
Personal Injury Litigation – Plaintiffs (Tier 1)
Product Liability Litigation – Plaintiffs (Tier 1)

Washington, D.C.
Banking and Finance Law (Tier 3)
Bet-the-Company Litigation (Tier 3)
Business Organizations (including LLCs and Partnerships) (Tier 3)
Civil Rights Law (Tier 2)
Commercial Litigation (Tier 1)
Corporate Law (Tier 3)
Criminal Defense: White-Collar (Tier 1)
Employee Benefits (ERISA) Law (Tier 1)
Energy Law (Tier 2)
Litigation – ERISA (Tier 2)
Mergers & Acquisitions Law (Tier 1)
Securities / Capital Markets Law (Tier 3)

For more rankings please follow this link.

Partner Mark Boyko Quoted in Bloomberg Law About Federal Court Appellate Ruling

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BG ERISA litigator Mark Boyko is quoted in a Bloomberg Law article (“Parker-Hannifin Suit Revival Hints at Lower 401(k) Challenge Bar”) related to a recent worker-friendly appellate decision by the U.S. Court of Appeals for the Sixth Circuit.

The decision (note: Bailey Glasser is not counsel in this case) requires Parker-Hannifin, a Cleveland-based company, to defend claims that it mismanaged its 32,000-person 401(k) plan when it retained unproven and underperforming target date funds from Northern Trust. The U.S. Court of Appeals for the Sixth Circuit found in a 2-1 split decision that Parker-Hannifin workers have viable ERISA claims because they plausibly alleged that the Northern Trust Focus Funds had high investor turnover and underperformed a target date fund index from S&P Global.

The decision marks the latest word on the “meaningful benchmark” standard that several courts, including the Sixth, Seventh, Eighth, and Tenth circuits, have used to assess whether retirement investors have identified a better alternative that’s sufficiently similar to the fund or fee structure they challenge.

In the Bloomberg article, Mr. Boyko states that an overly restrictive interpretation of the “meaningful benchmark” standard creates “huge obstacles for workers challenging actively managed funds or target date funds with distinct characteristics.”

To read the full article (subscription necessary) click this link.

To learn more about Mr. Boyko’s practice where he protects workers’ and retirees’ hard-earned money, please visit his firm bio here.

To learn more about BG’s nationally-ranked ERISA practice, please visit our ERISA Practice Group webpage.

Client Alert: Protecting Children Online on Universal Children’s Day

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Today is Universal Children’s Day, celebrated on November 20th each year to promote international togetherness, awareness among children worldwide, and improving children’s welfare.

In the article, “Protecting Children Online on Universal Children’s Day,” Sharon Iskra, Bailey Glasser partner and leader of our Institutional Abuse & Neglect team, encourages us to celebrate by reflecting on all the wonders of childhood: the innocence, joy, curiosity, and energy, but realizing the hazards to today’s children, especially online, where children can be trapped and manipulated through child sexual abuse materials (CSAM).

“It’s up to every one of us to protect kids, whether they’re our own or those we encounter through work or friends. Child safety IS your business – and at Bailey Glasser, it’s our business too,” Sharon writes.

One of the best things we can do to protect a child is to be a genuinely safe person of trust for them. Practice these fundamentals as appropriate in the context of your relationship with a child:

1. Parents/caregivers, talk to your children regularly and in age-appropriate ways about online safety.
2. Empower children, teach them to trust their instincts and repeat to them that if something doesn’t seem right or frightens them, take it to a safe adult right away.
3. Teach body integrity and self-worth.
4. Remind children that adults are supposed to protect children, and children are supposed to be children.

Read the full article to learn more tips about how to be a person of trust for children, how to protect them from CSAM, and for nationally sourced resources on how to begin talking to your child.

Learn more information on Sharon Iskra by visiting here.