December 27, 2024 – Just like the pendulum swings, the Fifth Circuit has once again reversed its direction on the handling of the preliminary injunction against the reporting requirements of the Corporate Transparency Act (CTA). In an order filed December 26, 2024, the Fifth Circuit Court of Appeals has vacated its own stay of the District Court’s preliminary injunction against the enforcement of the deadline for reporting compliance under the CTA. 

Reporting companies are now once more relieved of their mandatory reporting obligations, and FinCEN’s new deadlines are at this moment no longer enforceable – but still voluntary. We understand that these rapidly changing decisions create uncertainty and confusion.  

The Fifth Circuit justified this sudden change of reasoning by stating:

“The merits panel now has the appeal, which remains expedited, and a briefing schedule will issue forthwith. However, in order to preserve the constitutional status quo while the merits panel considers the parties’ weighty substantive arguments, that part of the motions-panel order granting the Government’s motion to stay the district court’s preliminary injunction enjoining enforcement of the CTA and the Reporting Rule is VACATED.”

RRD will continue to monitor the situation as it develops. Please contact your RRD attorney with any questions.