The D.C. Circuit issued three opinions last week. Let’s dive right into the two that raised administrative law questions.

For one, the D.C. Circuit denied a petition for rehearing en banc in Guedes v. ATF – the bump-stock case. (For our prior coverage, see here and here.) In 2022, a unanimous panel rejected a challenge to the ATF’s bump-stock rule, with Judge Wilkins summarizing the case thus:

Is a bump stock device a “machine gun” within the meaning of federal law? We are tasked with answering that question definitively. Following the 2017 mass shooting in Las Vegas in which 58 people were killed and approximately 500 were wounded—the deadliest in modern American history—the Bureau of Alcohol, Tobacco, Firearms, and Explosives (“ATF” or the “Bureau”) promulgated a rule classifying “bump stocks” as machine guns. A bump stock, like those used by the Las Vegas shooter, replaces a rifle’s stationary stock with a sliding stock. It thereby enables the weapon to slide back and forth against the shooter’s shoulder, “bumping” the shooter’s trigger finger repeatedly and rapidly firing the weapon. The Bureau’s new rule instructed individuals with bump stocks to either destroy them, abandon them at the nearest ATF facility, or face criminal penalties.

The Bureau interpreted “machine gun,” as defined in the National Firearms Act and Gun Control Act, to extend to bump stocks. Plaintiffs initially moved for a preliminary injunction to stop the rule from taking effect, which the District Court denied, and a panel of this Court affirmed. At the merits stage, the District Court again rejected Plaintiffs’ challenges to the rule under the Chevron framework. [Citation omitted.] The central question on appeal is whether the Bureau had the statutory authority to interpret “machine gun” to include bump stocks. Employing the traditional tools of statutory interpretation, we find that the disputed rule is consistent with the best interpretation of “machine gun” under the governing statutes. We therefore affirm.

Disagreeing with the panel’s judgment, Judges Henderson and Walker would have granted the petition for rehearing en banc. (Judges Katsas, Rao, and Pan did not participate in the vote.) In dissent, Judge Walker wrote that the ATF’s “overreach is troubling because it turns law-abiding Americans into criminals,” which only Congress, not the executive branch, may do. In Judge Walker’s view, the Bureau had relied “on a strained reading of an old statute” that did not authorize it ban to bump stocks.

The second administrative law case, Crim v. Commissioner of Internal Revenue, raised a separation-of-powers issue that the D.C. Circuit had decided before. The IRS penalized Crim for promoting a tax shelter scheme. He filed a motion in the Tax Court to disqualify the Tax Court judges on separation-of-powers grounds. The President has authority to remove Tax Court judges “after notice and opportunity for public hearing[] for inefficiency, neglect of duty, or malfeasance.” 26 U.S.C. § 7443(f). In 2014’s Kuretski v. CIR, the D.C. Circuit held that this removal provision does not violate the separation of powers. Crim argued that this 2014 decision no longer controls because in 2015 Congress amended the statute to state that the Tax Court is “not an agency of, and shall be independent of, the executive branch of the Government.”

Writing for the Court, Judge Rogers concluded that Congress’ action had not “undermined the separation of powers analysis” in the Court’s 2014 opinion. Kuretski had concluded that Tax Court judges are functionally independent while “exercis[ing] [their] authority as part of the Executive Branch.” On this understanding of the Court’s constitutional status, presidential removal of a Tax Court judge does “not involve the prospect of presidential removal of officers in another branch.” Judge Rogers concluded that Congress’s 2015 amendment left that structure intact. On that point, all three members of the panel (Judge Rogers, Judge Wilkins, and Judge Walker) agreed.[1]

Judge Walker dissented on a different issue: whether the IRS’s penalties were time-barred. Pointing to a three-year statute of limitations in 26 U.S.C. § 6501(a), Crim argued that the IRS waited too long – seven years, in fact – to penalize him. According to the IRS, this statute of limitations did not apply to tax-shelter-promotion penalties under 26 U.S.C. § 6700. Judges Rogers and Wilkins agreed (as do, it’s worth noting, the Second, Fifth, and Eighth Circuits). Judge Walker, by contrast, would have held that Congress had been clear in applying the three-year statute of limitations to Section 6700 penalties.

Finally, in Keren Kayemeth LeIsrael – Jewish National Fund v. Education for a Just Peace in the Middle East, the D.C. Circuit affirmed the dismissal of an Anti-Terrorism Act complaint that sought to hold the U.S. Campaign for Palestinian Rights (“USCPR”) liable for allegedly providing financial support to and aiding and abetting the Islamic Resistance Movement (“Hamas”). In an opinion by Judge Pan, who was joined by Judge Pillard and Judge Edwards, the Court held that the complaint did not state a claim for relief because it did not allege facts “to sufficiently connect USCPR to any acts of terrorism.”

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[1] Judge Walker stressed that he “express[ed] no opinion about whether tax judges’ removal protection is constitutional,” citing the Supreme Court’s opinion in Seila Law LLC v. CFPB.