In National Small Business United v. Yellen, the Department of Justice and FinCEN filed their Notice of Appeal, stating that they are appealing the Court’s ruling to the United States Court of Appeals for the Eleventh Circuit. While this move was expected, there is no way of knowing how long it will be until the appeal is heard by the Eleventh Circuit. We initially reported on the District Court’s ruling here.
While the appeal was expected and is welcomed by the NSBA1, it is important to note that what follows may impact the effect of the Court’s ruling. For instance, if FinCEN requests and is granted a stay of the Court’s ruling, the CTA would be enforceable even against the entities covered under the Court’s injunction. Additionally, how the Eleventh Circuit addresses a request for a stay may or may not give insight into the appeals court’s initial thoughts about the lower court’s decision.
Regardless, the clock is running for entities formed after January 1, 2024. Time will tell whether the case makes it through the appeals process prior to the end of the year. Perhaps Congress will take independent action by either amending the statute or adopting a delay in the filing deadline. Until then, we await further developments regarding the appeal.
1 https://www.journalofaccountancy.com/news/2024/mar/decision-holding-corporate-transparency-act-unconstitutional-appealed.html