Corporate Transparency Act Stayed As Federal Court Preliminary Determines Act To Be Unconstitutional

Yesterday, December 3, 2024, the U.S. District Court for the Eastern District of Texas issued a preliminary injunction in favor of the plaintiffs in the case of Texas Top Cop Shop, Inc. et al. vs. Garland (U.S. Attorney General), et al. The Court determined that the Corporate Transparency Act (the “CTA”) and the reporting requirements promulgated under the CTA (the “Reporting Rule”) are likely unconstitutional for purposes of granting a preliminary injunction that blocks the U.S. Treasury Department’s Financial Crimes Enforcement Network (“FinCEN”) from enforcing the requirements under the CTA, including the Reporting Rule.