City of Syracuse, NY v. Bureau of Alcohol, Tobacco, Firearms and Explosives

Background

The plaintiffs challenged an interpretive rule issued by the Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF), three ATF determination letters issued to Polymer80, and the ATF’s failure to respond to the plaintiffs’ petition for rulemaking. The plaintiffs brought their claims under the Administrative Procedure Act and argued that the Gun Control Act covers certain unfinished frames and receivers used to make “ghost guns.”

Polymer80 designs, develops, and sells aftermarket gun accessories, including unfinished frames and kits. The company learned about the lawsuit after the complaint referred to its business and products. It initially did not seek to join the case, but moved to intervene after an ATF raid of its facility in December 2020. Polymer80 asserted that the case could substantially affect its business and that the government defendants’ investigation of its sale of “Buy Build Shoot” kits created a conflict with its interests in defending the ATF rule and determination letters.

Intervention as of Right

Federal Rule of Civil Procedure 24(a) requires intervention when the applicant timely asserts a legally protectable interest that could be impaired by the case and the existing parties do not adequately represent that interest. The court found that Polymer80’s motion was timely. Although the company had known about the case and waited nearly four months to move, the court considered the ATF raid an unusual circumstance that reasonably changed Polymer80’s position. The court also found that Polymer80 had a direct and legally protectable interest because an unfavorable ruling could prevent it from relying on the ATF’s determination letters to sell its products. The court further found that Polymer80’s ability to protect its interests could be impaired if it remained a nonparty.

The court nevertheless concluded that Polymer80 could not intervene as of right. The government defendants were forcefully defending the ATF rule and determination letters, and their interests were aligned with Polymer80 on the issues challenged in this case. The court distinguished the challenged unfinished frames from the “Buy Build Shoot” kits, which the ATF treated as containing all components needed to assemble a functioning pistol. The court therefore found that the ATF’s investigation of the kits did not establish that the government defendants had changed their position on the rule or determination letters at issue.

Permissive Intervention

Rule 24(b) allows a court to permit intervention when the proposed intervenor has a claim or defense sharing a common legal or factual question with the main action. Unlike intervention as of right, this form of intervention does not require proof that the existing parties inadequately represent the applicant. The court may impose conditions to prevent undue delay or prejudice.

The court granted Polymer80 permissive intervention on a conditional basis. Polymer80’s determination letters were directly implicated by the case, and the company’s business could be substantially affected by the court’s ruling. Although adding Polymer80 would delay the case by requiring additional participation in summary-judgment briefing, the court found that the delay would not be undue. The court also considered Polymer80’s concern about relying on agencies that were investigating it to protect its interests in this litigation.

Conditions and Disposition

Polymer80’s intervention was limited to litigating the plaintiffs’ existing claims under the Administrative Procedure Act. The court did not permit expansion into legal or factual issues outside the operative complaint. The court also stated that the case would remain focused on the administrative record and that it did not expect to permit discovery or extra-record evidence.

The court concluded that Polymer80 had failed to show that it could intervene as of right, but granted Polymer80’s motion to intervene conditionally under Rule 24(b). The parties were directed to confer and propose a schedule for Polymer80’s participation in the summary-judgment briefing by March 26, 2021. The opinion decided only Polymer80’s intervention request; it did not decide the merits of the plaintiffs’ challenges to the ATF rule, determination letters, or delay in responding to the rulemaking petition.