Amicus Briefs
Texas Top Cop Shop, et al. v. Garland
CASE SUMMARY
NCLA urges the U.S. Court of Appeals for the Fifth Circuit to reject the government’s request to stay a preliminary injunction against enforcement of the Corporate Transparency Act. The government cannot be allowed to maintain this unconstitutional statute, which stretches beyond Congress’s proper authority to regulate Americans.
The CTA mandates that organizations that have filed for incorporation under state law submit detailed reports which include sensitive information to the Department of the Treasury. Americans would be civilly or criminally punished if they fail to comply, whether by omitting information or even accidentally submitting false information. These requirements apply to non-profit and certain for-profit organizations alike, and do not involve commercial transactions or any other type of economic activity.
The government is unlikely to succeed on the merits of its claim that the CTA falls within Congress’ regulatory power under the Constitution’s Commerce Clause. Coming into existence by filing incorporation paperwork is not economic activity because it does not involve producing, consuming, or exchanging any good or service for which there is a national market. The government argues that most organizations that incorporate will engage in economic activity in the future. But the Supreme Court has made clear the government cannot justify regulation under the Commerce Clause based on economic activity that has not yet taken place.