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Sig Sauer, Inc. v. Jones

United States District Court, D. New Hampshire

September 24, 2015

Sig Sauer, Inc.
v.
B. Todd Jones, Director, Bureau of Alcohol, Tobacco, Firearms and Explosives

Page 365

          For Sig Sauer, Inc., Plaintiff: Stephen P. Halbrook, LEAD ATTORNEY, PRO HAC VICE, Hallbrook Law Office, Fairfax, VA; Kenton James Villano, Mark C. Rouvalis, McLane Graf Raulerson & Middleton PA (Manchester), Manchester, NH.

         For U.S. Bureau of Alcohol, Tobacco, Firearms, and Explosives, Director, other, B. Todd Jones, Defendant: T. David Plourde, U.S. Attorney's Office (NH), Concord, NH; William Ryan, Bureau of Alcohol Tobacco Firearms & Explosives, Office of Chief Counsel, Martinsburg, WV.

Page 366

         MEMORANDUM AND ORDER

         Paul Barbadoro, United States District Judge.

         The National Firearms Act (" NFA" ) imposes strict registration requirements and a special tax on anyone who makes, sells, or possesses certain dangerous weapons such as machine guns, short-barreled rifles and silencers. 26 U.S.C. § § 5801-72. Sig Sauer, Inc. plans to produce and sell a rifle with a silencer component known as a " monolithic baffle core" that is permanently affixed to the barrel of the rifle. It contends that the baffle core is exempt from registration under the NFA because it does not meet the statutory definition of a silencer. The Bureau of Alcohol, Tobacco, and Firearms (" ATF" ) rejected Sig Sauer's argument in an informal adjudicatory proceeding and instead concluded that the baffle core should be treated as a silencer under the NFA. 18 U.S.C. § 921(a)(24). The issue this case presents is whether the AFT's determination was " arbitrary, capricious, an abuse of discretion, or otherwise not in accordance of law" under the Administrative Procedure Act (" APA" ), 5 U.S.C. § 706(2)(A).

         I. BACKGROUND

         A. Statutory Framework

         The NFA applies to " particularly dangerous weapons," United States v. Posnjak, 457 F.2d 1110, 1113 (2d Cir. 1972), including shotguns with barrels less than 18 inches in length, rifles with barrels less than 16 inches in length, machineguns, silencers, and destructive devices. 26 U.S.C. § 5845(a) (defining " firearm" for purposes of the NFA). The NFA sets " rigorous registration and taxation requirements for the dealers and transferors of those weapons." Posnjak, 457 F.2d at 1113. For example, each NFA firearm must be registered in a central federal registry and bear a serial number. 26 U.S.C. § § 5841, 5842. The NFA also imposes a $200 tax on the making of an NFA firearm and on each subsequent transfer of the firearm. 26 U.S.C. § § 5811, 5821; see Posnjak, 457 F.2d at 1114. Violations of the NFA are punishable by substantial fines and imprisonment for up to ten years. 26 U.S.C. § 5871.

         The NFA adopts the definition of the term " firearm silencer" used in the Gun Control Act (" GCA" ).[1] 18 U.S.C. § 921(a)(24) (GCA definition of silencer); 26 U.S.C. § 5845(a) (incorporating GCA definition by reference). Under the GCA, a firearm silencer is defined as:

[A]ny device for silencing, muffling, or diminishing the report of a portable firearm, including any combination of parts, designed or redesigned, and intended for use in assembling or fabricating a firearm silencer or firearm muffler, and any part intended only for use in such assembly or fabrication.

18 U.S.C. § 921(a)(24). This definition broadly encompasses both completed silencers and parts that can be used to produce silencers. Any combination of parts that is intended to be used to produce a silencer will be deemed to be a silencer under both the NFA and the

Page 367

GCA, and a single part can qualify if it is " intended only for use" in a silencer.

         B. Sig Sauer's Classification Request

         On April 4, 2013, Sig Sauer submitted a prototype firearm to the ATF and sought confirmation that the prototype would not be subject to registration under the NFA.[2] See A.R. 790.[3] As proposed, the device combined a short-barreled rifle with a monolithic baffle core[4] that Sig Sauer uses in producing silencers. See A.R. 824. Sig Sauer explained in a letter submitted with the prototype that it intended the baffle core to serve as a muzzle brake[5] and not a silencer. See A.R. 790 (doc. no. 15). It also asserted that its prototype would not be subject to registration under the NFA as a short-barreled rifle because the combined length of the prototype's barrel and the baffle core was 16 inches, the minimum barrel length that is sufficient to avoid classification as a short-barreled rifle. Id.

         The ATF responded to Sig Sauer's request by noting that the baffle core was a silencer component and concluding, without further explanation, that it qualified as a silencer under the NFA because it was a part intended only for use in a silencer. See A.R. 791-93.

         Sig Sauer followed up several months later with a request for reconsideration. See A.R. 796-808. In pressing its request, Sig Sauer reiterated its statement that it intended the baffle core to serve as a muzzle brake rather than a silencer. See A.R. 796. It also submitted sound testing data for the prototype that showed that the baffle core did not reduce the sound of a firearm discharge when used without an outer tube. See A.R. 797. Finally, Sig Sauer produced evidence supporting its claim that the baffle core functioned as a muzzle brake, and it identified several other devices that are manufactured and sold as muzzle brakes which, it argued, were similar to the baffle core. See A.R. 798.

         The ATF responded with a one-page letter again stating without explanation that the baffle core was a " silencer" because it was " a part intended only for use in the assembly or fabrication of a silencer." A.R. 809.

         Sig Sauer filed its complaint in this court on April 7, 2014. On June 9, 2014, the parties filed a joint motion to stay the litigation to permit the ATF to reassess its determination that the baffle core qualified as a silencer under the NFA. Doc. No. 9. Shortly thereafter, Sig Sauer submitted a second version of the prototype that was substantially similar to ...


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