By Bracewell
On December 3, 2024, the US District Court for the Eastern District of Texas issued a nationwide preliminary injunction, halting enforcement of the Corporate Transparency Act (CTA) and its implementing regulations.
In the case, Texas Top Cop Shop, Inc., et al. v. Garland, the court issued the preliminary injunction after finding that the CTA and its regulations are likely unconstitutional. The court’s order enjoins both the CTA, 31 U.S.C. § 5336, and the final rule implementing the CTA, 31 C.F.R. 1010.380, pausing enforcement of both. In connection with the injunction, the court stayed the January 1, 2025, beneficial ownership information compliance deadline. As a result, reporting companies are not required to comply with the CTA’s beneficial ownership reporting requirements until further order of the court.
