Corporate Transparency Act Challengers Forecast Return to SCOTUS

A trial court order limiting Corporate Transparency Act enforcement should be upheld, a small business group said in a letter to a federal appeals court, contending their case would offer the US Supreme Court a chance to consider the act outside of its emergency docket.

Delivered Monday, the letter comes five months after the US Court of Appeals for the Eleventh Circuit heard oral arguments between the government and National Small Business United, operating as the National Small Business Association, over an Alabama court order blocking CTA enforcement against NSBU members.

The CTA, which the lower court called unconstitutional, requires US entities to disclose identifying information about their owners to the Treasury Department.

The NSBA’s letter, the second sent to the court Monday, was delivered in response to an earlier missive from the US, urging the Eleventh Circuit to overturn that Alabama order. The Supreme Court suggested CTA challengers were unlikely to succeed on the merits, the US letter said. The justices’ January order had stayed a nationwide preliminary injunction against the act issued by a Texas federal judge in a separate case late last year.

NSBA’s response asserted that the Supreme Court’s order actually weighed in the group’s favor by demonstrating a need for the justices to consider the CTA on its merits rather than through the compressed timeline of a preliminary injunction.

“The most logical interpretation of the Supreme Court’s order is that it reflects skepticism about universal injunctions and reluctance to address the CTA’s constitutionality on its emergency docket based on incomplete briefing,” the group’s letter said. Affirming the Alabama district court “will enable the Supreme Court to resolve these issues on its merits docket instead of its emergency docket.”

The government extended its deadline to March 21 for most businesses to comply with the CTA’s disclosure requirements following the Supreme Court’s order, but that extension excluded NSBA members, who aren’t required to comply. Certain other businesses qualifying for disaster relief have until April to file their beneficial ownership reports to the Financial Crimes Enforcement Network.

Maynard Nexsen PC and Hughes, Hubbard & Reed LP represents NSBU.

The case is Nat’l Small Bus. United v. US Dep’t of the Treasury, 11th Cir., No. 24-10736, response filed 2/24/25.