Key Takeaways
- The Department of Justice has voluntarily dismissed its appeal in State of Texas v. ATF, facilitating a review of the ‘Engaged in the Business’ rule.
- The ATF plans to revise guidelines on who is considered ‘engaged in the business’ of selling firearms.
- This dismissal is important for private sellers, as it protects law-abiding citizens from potential criminal liabilities under the prior rule.
- The upcoming notice of proposed rulemaking (NPRM) will allow public comments on the revised guidelines.
- The ATF’s actions demonstrate a course correction in line with Second Amendment protections and legal practices.
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WASHINGTON, DC — The Department of Justice has moved to voluntarily dismiss its appeal in State of Texas v. Bureau of Alcohol, Tobacco, Firearms, and Explosives, a significant step that clears the path for the ATF to revisit the controversial “Engaged in the Business” rule.
The consent motion was filed on April 16, 2026, in the United States Court of Appeals for the Fifth Circuit under case number 24-10612. Plaintiffs, which include the State of Texas and other parties, consented to the dismissal. All parties will bear their own costs.
According to the filing, the ATF “plans to revisit” the rule at the heart of the case and will “revis[e] the guidelines for determining who is considered ‘engaged in the business’ of selling firearms.” A notice of proposed rulemaking addressing the same subject matter as the challenged rule is forthcoming.
In light of that forthcoming NPRM, the government determined that continuing the appeal was no longer appropriate. The motion was submitted by attorneys with the Civil Division’s Appellate Staff at the U.S. Department of Justice.
More from USA Carry:
The “Engaged in the Business” rule had drawn sharp legal challenges from gun owners, private sellers, and state attorneys general who argued the rule swept far too broadly. Critics warned that the rule could treat ordinary private sellers as unlicensed dealers, exposing lawful gun owners to federal criminal liability for conduct that has long been legal.
For armed citizens and private sellers, the dismissal is a meaningful development. Private firearm transfers between law-abiding citizens are a long-standing, legal practice protected under the framework of the Second Amendment, and the prior rule’s expansive reach raised serious concerns about criminalizing routine conduct.
The Second Amendment protects a fundamental civil right, and any federal rule that chills the lawful exercise of that right deserves close scrutiny. The ATF’s decision to revisit the rule, combined with the DOJ’s withdrawal of its appeal, signals a course correction that respects the boundaries set by Congress and the Constitution.
Armed citizens should continue to follow all applicable federal and state laws when buying, selling, or transferring firearms. A forthcoming NPRM will open a formal public comment period, giving gun owners and Second Amendment organizations a direct opportunity to weigh in on the revised guidelines.