McCutchen v. United States

In the United States Court of Federal Claims
No. 18-1965C
(Filed: September 23, 2019)
)
ROY LYNN MCCUTCHEN, et al., ) Keywords: Bump Stocks; Fifth
) Amendment; Categorical Takings;
Plaintiffs, ) Regulatory Takings; Police Power
)
v. )
)
THE UNITED STATES OF AMERICA, )
)
Defendant. )
)
)
)
Ethan A. Flint, Flint Law Firm, LLC, Edwardsville, IL, for Plaintiff. Adam M. Riley, Flint Law
Firm, LLC, Edwardsville, IL, Of Counsel.
Nathaniel B. Yale, Trial Attorney, Commercial Litigation Branch, Civil Division, U.S.
Department of Justice, Washington, DC, for Defendant, with whom were L. Misha Preheim,
Assistant Director, Robert E. Kirschman, Jr., Director, and Joseph H. Hunt, Assistant Attorney
General. Melissa Anderson, Associate Chief Counsel, Litigation, Bureau of Alcohol, Tobacco,
Firearms and Explosives, Of Counsel.
OPINION AND ORDER
KAPLAN, Judge.
On the evening of October 1, 2017, a lone gunman stationed himself in a high-rise, Las
Vegas hotel room and fired 1100 rounds of ammunition downward onto a crowd attending a
country music concert. Fifty-eight people were killed. Over eight hundred more were wounded
by gunshots or as a result of the ensuing panic. When the authorities entered the shooter’s hotel
room, they found twelve semi-automatic weapons equipped with “bump stocks”—devices that
allow a semi-automatic weapon to fire continuous rounds at a rate similar to that of a
machinegun. See Barbara Goldberg et al., One Year Later, Las Vegas Honors 58 Killed in Mass
Shooting, REUTERS, Oct. 1, 2018, https://www.reuters.com/article/us-lasvegas-shooting/one-
year-later-las-vegas-honors-58-killed-in-mass-shooting-idUSKCN1MB3CO.
As of the date of this opinion, the mass shooting in Las Vegas remains the deadliest in
American history. In its wake, the Department of Justice’s Bureau of Alcohol, Tobacco,
Firearms, and Explosives (“ATF”) re-examined the status of bump-stock devices under federal
firearms laws. Ultimately, after a period of notice and comment, it issued a final rule that re-
classified bump stocks as “machineguns” under the National Firearms Act of 1934 and the Gun
Control Act of 1968, thereby outlawing their possession and sale effective March 26, 2019. The
regulation specified that, to avoid prosecution, owners of bump stocks must either destroy their
devices or abandon them at an ATF office by that date.
Plaintiff Roy Lynn McCutchen legally purchased and owns multiple bump-stock devices
“for both his personal use and for economic gain.” Class Action Compl. (“Compl.”) ¶ 10, ECF
No. 1. Plaintiff Paducah Shooter’s Supply, Inc., is a registered firearms dealer that sells bump-
stock devices and also operates a shooting range that occasionally hosts paid “machine gun
shoots” where participants use bump-stock-type devices affixed to firearms. Id. ¶ 11. Both
Plaintiffs complied with the final rule by destroying all of the bump-stock devices in their
possession. Pls.’ Opp’n to Def.’s Mot. to Dismiss (“Pls.’ Opp’n”) at 5, ECF No. 12.
Plaintiffs brought this putative class action on behalf of themselves and “[a]ll United
States persons who have purchased a bump-fire stock or bump-fire type device, as listed in
Exhibit 1 [to the complaint], for personal or commercial use, during the period extending from
June 7, 2010, through and to the filing date of th[e] Complaint.” Compl. ¶ 26. They allege that
the ATF rule has effected a “taking” of their property for which just compensation is required
under the Fifth Amendment. Id. ¶ 1.
Currently before the Court is the government’s motion to dismiss the complaint under
Rule 12(b)(6) of the Rules of the Court of Federal Claims (“RCFC”) for failure to state a claim.
For the reasons set forth below, the government’s motion is GRANTED and the complaint is
DISMISSED with prejudice.
BACKGROUND
I. Statutory Framework
To protect the public safety, Congress has enacted a series of statutes that regulate the
manufacture, transfer, and possession of firearms generally—and machineguns in particular.
These statutes include the National Firearms Act of 1934 (“NFA”), Pub. L. 73-474, 48 Stat. 1236
(codified as amended at I.R.C. §§ 5801–72); the Gun Control Act of 1968 (“GCA”), Pub. L. No.
90-618, 82 Stat. 1213 (amending 18 U.S.C. §§ 921–28 and I.R.C. ch. 53); and the Firearms
Owners’ Protection Act (“FOPA”), Pub. L. 99-308, 100 Stat. 449 (1986) (amending 18 U.S.C.
§§ 921–29).
The NFA was enacted a year after Prohibition ended. Its purpose was, among other
things, to regulate “lethal weapons . . . [that] could be used readily and efficiently by criminals
and gangsters.” H.R. Rep. No. 83-1337, at A395 (1954); see United States v. Thompson/Ctr.
Arms Co., 504 U.S. 505, 517 (1992) (observing that it was “clear from the face of the Act that
the NFA’s object was to regulate certain weapons likely to be used for criminal purposes”). The
NFA imposed a tax on the manufacture and transfer of certain types of firearms. See NFA § 2. It
further required that the Secretary of the Treasury maintain a registry of such firearms (referred
to in I.R.C. § 5841 as the National Firearms Registration and Transfer Record). See generally
NFA.
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Machineguns were among the firearms covered by the NFA. “Machine gun” was defined
as “any weapon which shoots, or is designed to shoot, automatically or semiautomatically, more
than one shot, without manual reloading, by a single function of the trigger.” NFA § 1(b).
Some thirty-four years later, in the aftermath of the assassinations of President John F.
Kennedy, Attorney General Robert Kennedy, and Dr. Martin Luther King, Jr., Congress enacted
the GCA. See Gun Control Act of 1968, Bureau of Alcohol, Tobacco, Firearms and Explosives
(July 2, 2019), https://www.atf.gov/rules-and-regulations/gun-control-act. The purpose of the
1968 law was to “regulate more effectively interstate commerce in firearms,” to help “combat
the skyrocketing increase in the incidence of serious crime,” and to assist state and local
governments “to enforce their firearms control laws.” S. Rep. No. 89-1866, at 1 (1966). The
GCA imposed stricter regulation of the firearms industry, defined new categories of firearms
offenses, and placed further restrictions on the sale of firearms. See Gun Control Act of 1968,
https://www.atf.gov/rules-and-regulations/gun-control-act.
Among many other provisions, the GCA made it a criminal offense for “any person
[except] a licensed importer, licensed manufacturer, licensed dealer, or licensed collector, to
transport in interstate or foreign commerce any . . . machinegun (as defined in section 5845 of
the Internal Revenue Code []) . . . except as specifically authorized by [the Attorney General]
consistent with public safety and necessity.” GCA § 102 (amending 18 U.S.C. § 922). The GCA
also amended and expanded the definition of “machinegun” set forth in the NFA, to encompass
“any weapon which shoots, is designed to shoot, or can be readily restored to shoot,
automatically more than one shot, without manual reloading, by a single function of the trigger,”
as well as “the frame or receiver of any such weapon, any combination of parts designed and
intended for use in converting a weapon into a machinegun, and any combination of parts from
which a machinegun can be assembled if such parts are in the possession or under the control of
a person.” GCA § 201 (amending I.R.C. § 5845).
Finally, in 1986 Congress passed FOPA, which amended the GCA by making it
“unlawful for any person [with exceptions not relevant here] to transfer or possess a
machinegun” not lawfully possessed before FOPA’s effective date, May 19, 1986. FOPA
§§ 102, 110 (amending 18 U.S.C. § 922). The new restrictions were intended, among other
things, to protect law enforcement officers from the “proliferation” of machineguns, and to
prevent “racketeers and drug traffickers” from using machineguns “for intimidation, murder and
protection of drugs and the proceeds of crime.” H.R. Rep. No. 99-495, at 4 (1986).
As amended by FOPA, and in its current form, a “machinegun” is defined in the United
States code as “any weapon which shoots, is designed to shoot, or can be readily restored to
shoot, automatically more than one shot, without manual reloading, by a single function of the
trigger.” I.R.C. § 5845(b). The Act left in place portions of the prior definition of “machinegun”
that include “the frame or receiver of any such weapon.” Id. It added new language, however,
specifying that the term machinegun would also include “any part designed and intended solely
and exclusively, or combination of parts designed and intended, for use in converting a weapon
into a machinegun.” FOPA § 109 (amending I.R.C. § 5845(b)).
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II. Regulatory Framework
Congress has delegated the authority to promulgate rules and regulations necessary to
enforce the provisions of the NFA and GCA to the Attorney General. See 18 U.S.C. § 926(a); 26
U.S.C. § 7805(a). The Attorney General, in turn, has delegated his authority to administer the
statutes to the Director of ATF. 28 C.F.R. § 0.130(a).
Consistent with that delegation, ATF has published a number of regulations in the
Federal Register which, after a period of notice and comment, were codified in the Code of
Federal Regulations. These include provisions that incorporate and also elaborate on the
definitions of certain statutory terms, including “machinegun.” See 27 CFR pts. 478, 479.
ATF also “publishes rulings in its periodic bulletins and posts them on the ATF website.”
Bureau of Alcohol, Tobacco, Firearms and Explosives National Firearms Act Handbook (“ATF
Handbook”) § 1.4.2 (rev. Apr. 2009), https://www.atf.gov/firearms/docs/guide/atf-national-
firearms-act-handbook-atf-p-53208/download. “These [rulings] contain ATF’s interpretation of
the law and regulations as they pertain to a particular fact situation.” Id. They “do not have the
force and effect of law but may be cited as precedent with respect to substantially similar fact
situations.” Id.
Finally, “ATF permits—but does not require—gun makers to seek classification letters
from ATF prior to manufacturing a gun.” See Sig Sauer, Inc. v. Brandon, 826 F.3d 598, 599 (1st
Cir. 2016) (citing ATF Handbook § 7.2.4). ATF classification letters “may generally be relied
upon by their recipients as the agency’s official position concerning the status of the firearms
under Federal firearms laws.” ATF Handbook § 7.2.4.1. Such classifications, however, “are
subject to change if later determined to be erroneous or impacted by subsequent changes in the
law or regulations.” Id. They do not have the force and effect of law. See Innovator Enters. v.
Jones, 28 F. Supp. 3d 14, 23 (D.D.C. 2014).
III. Administrative Treatment of Bump-Stock Devices Before the Las Vegas Mass
Shooting
Over the years, ATF has issued a number of rules and classification letters regarding the
status of bump-stock devices under federal firearms laws. One of the cited purposes of the final
rule at issue in this case was to reconcile the previously inconsistent approaches ATF had taken
regarding the devices in the preceding almost twenty years. See Bump-Stock-Type Devices, 83
Fed. Reg. 66,514, 66,518 (Dec. 26, 2018) (noting that “prior ATF rulings concerning bump-
stock-type devices did not provide substantial or consistent legal analysis regarding the meaning
of the term ‘automatically,’ as it is used in the NFA and GCA”).
In 2002, the inventor of the “Akins Accelerator”—a type of bump-stock device that is
spring-powered to allow a semi-automatic firearm to “cycle back and forth, impacting the trigger
finger without further input by the shooter while the firearm discharged multiple shots”—
requested a classification opinion from ATF. Id. at 66,517. ATF initially determined that the
Akins Accelerator was not a machinegun because, “the statutory term ‘single function of the
trigger’ [referred] to a single movement of the trigger.” Id.
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ATF subsequently received several classification requests concerning devices that—like
the Akins Accelerator—were “exclusively designed to increase the rate of fire of semiautomatic
firearms.” Id. In Ruling 2006-2, issued on December 13, 2006, ATF retreated from the position it
had taken in its classification letter to the inventor of the Akins Accelerator. Id. In its Ruling,
ATF reasoned that the phrase “single function of the trigger” was best understood to mean a
“single pull of the trigger.” Id. Moving forward, ATF stated, devices like the Akins Accelerator
would be classified as machineguns if, “when activated by a single pull of the trigger, such
devices initiate an automatic firing cycle that continues until either the finger is released or the
ammunition supply is exhausted.” Id. (citing ATF Ruling 2006-2) (internal quotations and
alterations omitted). 1
ATF subsequently received classification requests for other bump-stock devices which—
unlike the Akins Accelerator—did not employ internal springs. Id. at 66,516. Instead, these
devices “harnesse[d] and direct[ed] the firearm’s recoil energy to slide the firearm back and forth
so that the trigger automatically re-engage[d] by ‘bumping’ the shooter’s stationary finger
without additional physical manipulation of the trigger by the shooter.” Id. In a series of
classification decisions between 2008 and 2017, ATF concluded that these devices were not
“machineguns” because, lacking internal springs or other mechanical parts that would channel
the recoil energy of the gun, they did not fire “automatically.” Id. at 66,517.
IV. The Regulation at Issue in this Case
In the wake of the mass shooting in Las Vegas, “ATF received correspondence from
members of the United States Congress, as well as nongovernmental organizations, requesting
that ATF examine its past classifications and determine whether bump-stock-type devices
available on the market constitute machineguns under the statutory definition.” Id. at 66,516.
Based on this public reaction, and at the direction of the President, the Department of Justice
revisited the issue of whether and under what circumstances bump-stock-type devices should be
classified as machineguns. Id. at 66,516–517. On March 29, 2018, ATF published a notice of
proposed rulemaking. Id. at 66,517; Bump-Stock-Type Devices, 82 Fed. Reg. 13,442 (Mar. 29,
2018) (notice of proposed rulemaking). The notice proposed changes to the regulations defining
“machinegun” contained at 27 C.F.R. § 447.11, 478.11, and 479.11, and directed that public
comment would close on June 27, 2018. 82 Fed. Reg. at 13,442.
ATF issued a final rule on December 26, 2018. 83 Fed. Reg. at 66,514. The new rule
amended the definition of the term “machinegun” as used in parts 477 through 479 of the Code
1
On January 19, 2007, ATF required the producer and distributor of the Akins Accelerator “to
remove recoil springs from all Akins Accelerators and surrender them to ATF, thereby rendering
the devices nonfunctional and without value.” See Akins v. United States, 82 Fed. Cl. 619, 621
(2008). As described in greater detail below, the inventor subsequently brought an unsuccessful
lawsuit in the Court of Federal Claims alleging a Fifth Amendment taking of his property. See id.
at 620. He also unsuccessfully challenged the rule’s lawfulness in federal district court. See
Akins v. United States, 312 F. App’x 197 (11th Cir. 2009).
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of Federal Regulations to specifically include bump-stock devices like the one used in the Las
Vegas mass shooting. It states as follows:
A “machinegun” . . . is a firearm which shoots, is designed to shoot, or can be
readily restored to shoot, automatically more than one shot, without manual
reloading, by a single function of the trigger . . . . [T]he term “automatically”. . .
means functioning as the result of a self-acting or self-regulating mechanism that
allows the firing of multiple rounds through a single function of the trigger; and
“single function of the trigger” means a single pull of the trigger and analogous
motions . . . . The term “machinegun” includes a bump-stock-type device, i.e., a
device that allows a semi-automatic firearm to shoot more than one shot with a
single pull of the trigger by harnessing the recoil energy of the semi-automatic
firearm to which it is affixed so that the trigger resets and continues firing without
additional physical manipulation of the trigger by the shooter.
83 Fed. Reg. at 66,553–54 (codified at 27 C.F.R. §§ 447.11(b), 478.11, 479.11) (emphasis
supplied).
The final rule provided that it would become “effective” on March 26, 2019, ninety days
after promulgation. Id. at 66,514. In the Federal Register notice, ATF stated that individuals
would be subject to “criminal liability only for possessing bump-stock-type devices after the
effective date of regulation, not for possession before that date.” Id. at 66,525; see also id.
(stating that the final rule “criminalize[s] only future conduct, not past possession of bump-stock-
type devices that ceases by the effective date”); id. at 66,539 (“To the extent that owners timely
destroy or abandon these bump-stock-type devices, they will not be in violation of the law.”).
Bump-stock owners were directed to either abandon their devices at an ATF office by March 26,
2019 or destroy them by “melting, crushing, [] shredding,” or using a hammer to disable them
“in a manner that renders the device incapable of ready restoration.” Id. at 66,549.
V. APA Litigation
The lawfulness of ATF’s final rule defining bump-stock devices as machineguns is
currently the subject of several Administrative Procedure Act (“APA”) challenges before the
United States District Courts for the District of Columbia, the Western District of Michigan, and
the District of Utah. All three district courts denied motions for preliminary injunctions filed by
the plaintiffs in those cases. Aposhian v. Barr, 374 F. Supp. 3d 1145 (D. Utah 2019), appeal
docketed, No. 19-4036 (10th Cir. Mar. 18, 2019); Gun Owners of Am. v. Barr, 363 F. Supp. 3d
823 (W.D. Mich. 2019), appeal docketed, No. 19-1298 (6th Cir. Mar. 22, 2019); Guedes v.
Bureau of Alcohol, Tobacco, Firearms, & Explosives, 356 F. Supp. 3d 109 (D.D.C. 2019), aff’d
920 F.3d 1 (D.C. Cir. 2019), petition for cert. filed, — U.S.L.W. — (U.S. Sept. 4, 2019) (No. 19-
296).
In a recent decision, the United States Court of Appeals for the District of Columbia
Circuit affirmed the district court’s denial of the plaintiffs’ motion for a preliminary injunction.
Guedes, 920 F.3d at 6. It held that the plaintiffs had failed to show a substantial likelihood of
success on the merits of their APA claim. Id. Finding that the rule was legislative as opposed to
interpretive and applying the standards set forth in Chevron, U.S.A., Inc. v. Nat. Res. Def.
6
Council, Inc., 467 U.S. 837 (1984), the court of appeals held that the statutory definition of
“machinegun” is ambiguous and that ATF’s interpretation of the statute, under which bump-
stock devices were included within that definition, was a reasonable one. Id. at 29.
VI. The Present Action
Plaintiffs Roy Lynn McCutchen and Paducah Shooter’s Supply, Inc. filed a class action
complaint in this court on December 26, 2018. See generally Compl. They allege that ATF’s
reclassification of bump stocks as machineguns effected a taking of their property without just
compensation pursuant to the Fifth Amendment. Id. ¶¶ 40–52. They ask the Court to certify a
class, to find that the government’s actions violated the Fifth Amendment, and to award
Plaintiffs compensation for their losses. Id. at 9.
The government filed a motion to dismiss for failure to state a claim on May 2, 2019.
Mot. to Dismiss at 1, ECF No. 9. It contends that ATF’s rule did not effect a compensable taking
because it was issued pursuant to the government’s police power and not its authority to take
private property for a public use. Id. at 10. In the alternative, the government argues, even if the
rule effected a taking, it was a regulatory and not a physical one, and not compensable under the
multi-factor analysis prescribed for regulatory takings in Penn Central Transportation Co. v. City
of New York, 438 U.S. 104, 124 (1978) and its progeny. Id. at 17.
Plaintiffs filed their response to the government’s motion to dismiss on June 27, 2019.
See generally Pls.’ Opp’n. In their response, Plaintiffs allege that the final rule effected either a
per se physical or per se regulatory taking of their property, so that the government has a
categorical obligation to compensate them for the value of their property. Id.
Oral argument was held on the government’s motion to dismiss on August 29, 2019.
DISCUSSION
I. Jurisdiction
The Tucker Act authorizes the Court of Federal Claims “to render judgment upon any
claim against the United States founded either upon the Constitution, or any Act of Congress or
any regulation of an executive department, or upon any express or implied contract with
the United States, or for liquidated or unliquidated damages in cases not sounding in tort.” 28
U.S.C. § 1491(a). Claims for damages under the Takings Clause of the Fifth Amendment are
within this Court’s Tucker Act jurisdiction. Preseault v. Interstate Commerce Comm’n, 494 U.S.
1, 12, (1990); see also Lion Raisins, Inc. v. United States, 416 F.3d 1356, 1368 (Fed. Cir. 2005);
Narramore v. United States, 960 F.2d 1048, 1052 (Fed. Cir. 1992). Therefore, this Court has
jurisdiction over the takings claims before it.
II. Standard for Motions to Dismiss under RCFC 12(b)(6)
A complaint should be dismissed under RCFC 12(b)(6) “when the facts asserted by the
claimant do not entitle him to a legal remedy.” Lindsay v. United States, 295 F.3d 1252, 1257
(Fed. Cir. 2002). When considering a motion to dismiss for failure to state a claim upon which
relief may be granted, the Court “must accept as true all the factual allegations in the complaint,
7
and [the Court] must indulge all reasonable inferences in favor of the non-movant.” Sommers Oil
Co. v. United States, 241 F.3d 1375, 1378 (Fed. Cir. 2001) (citations omitted); see also
Huntleigh USA Corp. v. United States, 63 Fed. Cl. 440, 443 (2005). The Court, however, is not
required to “accept inferences drawn by plaintiffs if such inferences are unsupported by the facts
set out in the complaint. Nor must the court accept legal conclusions cast in the form of factual
allegations.” Kowal v. MCI Commc’ns Corp., 16 F.3d 1271, 1276 (D.C. Cir. 1994) (citing
Papasan v. Allain, 478 U.S. 265, 286 (1986)).
III. Overview of Takings Principles
The Fifth Amendment’s Takings Clause provides that private property shall not “be taken
for public use without just compensation.” U.S. Const. amend. V. The purpose of the Takings
Clause is to prevent “Government from forcing some people alone to bear public burdens which,
in all fairness and justice, should be borne by the public as a whole.” Penn Cent., 438 U.S. at
123.
“Takings claims typically come in two forms: per se or regulatory.” Alimanestianu v.
United States, 888 F.3d 1374, 1380 (Fed. Cir. 2018). A per se (or “categorical”) taking occurs
where there is a physical invasion or appropriation of property, whether real, Loretto v.
Teleprompter Manhattan CATV Corp., 458 U.S. 419, 427 (1982), or personal, Horne v. Dep’t of
Agric., 135 S. Ct. 2419, 2426 (2015). Further, a regulation that “denies all economically
beneficial or productive use of land” also effects a per se or categorical taking. Lucas v. S.C.
Coastal Council, 505 U.S. 1003, 1015 (1992).
“When the Government commits a per se taking, it has a categorical duty to pay just
compensation.” Alimanestianu 888 F.3d at 1380 (citing Horne, 135 S. Ct. at 2426). That duty
exists “without regard to the claimed public benefit or the economic impact on the owner.”
Horne, 135 S. Ct. at 2427.
In addition to per se (or categorical) takings, the Supreme Court has recognized that
where a regulatory restriction “does not entirely deprive an owner of property rights,” Horne,
135 S. Ct. at 2429, but nonetheless goes “too far,” id. at 2427 (quoting Pa. Coal Co. v. Mahon,
260 U.S. 393 (1922)), it may effect a regulatory taking. In Penn Central, 438 U.S. at 124, “the
Court clarified that the test for how far was ‘too far’ required an ‘ad hoc’ factual inquiry.” Horne,
135 S. Ct. at 2427. That ad hoc inquiry requires the court to consider “the character of the
governmental action,” “the extent to which the regulation has interfered with distinct investment-
backed expectations,” and “[t]he economic impact of the regulation on the claimant.”
Alimanestianu, 888 F.3d at 1381 (quoting Penn Cent., 438 U.S. at 124).
Here, Plaintiffs contend that the ATF rule effected a physical taking or, alternatively,
what they call a “per se regulatory taking,” either of which gives rise to “a categorical duty to
pay just compensation.” Pls.’ Opp’n at 7 (citing Horne, 135 S. Ct. at 2425–27); id. at 24
(explaining that “even if the Final Rule were construed as a regulatory taking, it would,
nonetheless, be a per se regulatory taking”). For the reasons set forth below, Plaintiffs’
arguments lack merit.
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IV. The ATF Rule Prohibiting Bump-Stock Devices Was an Exercise of Police Power
and Did Not Effect a Taking for Public Use
As is evident from its plain language, the Takings Clause does not require compensation
unless private property—whether personal or real—has been taken, whether physically or
through regulation, “for public use.” AmeriSource Corp. v. United States, 525 F.3d 1149, 1152
(Fed. Cir. 2008) (quoting U.S. Const. amend. V) (“The clause does not entitle all aggrieved
owners to recompense, only those whose property has been ‘taken for a public use.’”). Further, it
is well established that there is no taking for “public use” where the government acts pursuant to
its police power, i.e. where it criminalizes or otherwise outlaws the use or possession of property
that presents a danger to the public health and safety. See Keystone Bituminous Coal Ass’n v.
DeBenedictis, 480 U.S. 470, 491 (1987) (explaining that the Takings Clause does not transform
the government’s power to “restrict[] the uses individuals can make of their property . . . to one
that requires compensation whenever the State asserts its power to enforce it”); Miller v.
Schoene, 276 U.S. 272, 279–80 (1928) (holding that no taking occurred where the state ordered
the destruction of red cedar trees to protect health of apple trees and observing that “where the
public interest is involved, preferment of that interest over the property interest of the individual,
to the extent even of its destruction, is one of the distinguishing characteristics of every exercise
of the police power which affects property”); Mugler v. Kansas, 123 U.S. 623, 668–69 (1887)
(“A prohibition simply upon the use of property for purposes that are declared, by valid
legislation, to be injurious to the health, morals, or safety of the community, cannot, in any just
sense, be deemed a taking or an appropriation of property for the public benefit.”); AmeriSource,
525 F.3d at 1153 (noting that “it is clear that the police power encompasses the government’s
ability to seize and retain property to be used as evidence in a criminal prosecution”).
Of course, “it is insufficient to avoid the burdens imposed by the Takings Clause simply
to invoke the ‘police powers’ of the state.” Acadia Tech., Inc. v. United States, 458 F.3d 1327,
1332 (Fed. Cir. 2006). Nonetheless, there are certain exercises of the police power “that ha[ve]
repeatedly been treated as legitimate even in the absence of compensation to the owners of
the . . . property.” Id. at 1332–33. Among these are government actions taken to enforce
prohibitions on the use or possession of dangerous contraband, or to require the forfeiture of
property used in connection with criminal activity. See e.g., Bennis v. Michigan, 516 U.S. 442,
453 (1996) (holding that the forfeiture of an innocent owner’s property that was used in a crime
was not a taking); Kam-Almaz v. United States, 682 F.3d 1364, 1371 (Fed. Cir. 2012) (quoting
AmeriSource Corp., 525 F.3d at 1153) (finding that a laptop “seized and retained pursuant to the
police power” at a border crossing was “not taken for a ‘public use’ in the context of the Takings
Clause”); AmeriSource Corp, 525 F.3d at 1155 (finding that the seizure of pharmaceuticals from
an innocent third party for use in a criminal prosecution was an exercise of police power and not
a taking); Holliday Amusement Co. of Charleston, Inc. v. South Carolina, 493 F.3d 404, 411 n.2
(4th Cir. 2007) (finding that a state statute outlawing possession of video gaming machines did
not effect a taking and observing that regulations for the public good in heavily regulated fields
such as gambling “per se do not constitute takings”); Acadia Tech, 458 F.3d at 1332
(determining that a customs seizure of goods suspected of bearing counterfeit marks is not a
compensable taking for public use but was instead “a classic example of the government’s
exercise of the police power to condemn contraband or noxious goods”); United States v.
$7,990.00, 170 F.3d 843, 845 (8th Cir. 1999) (“[F]orfeiture of contraband is an exercise of the
government’s police power, not its eminent domain power.”).
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In this case, Plaintiffs’ bump-stock devices were not “taken for a public use,” within the
meaning of the Takings Clause. Instead, because the devices have been designated as
machineguns under ATF’s regulatory authority, they are subject to 18 U.S.C. § 922(o), which
makes their possession a criminal offense. ATF, in the exercise of its police power, directed that
owners of the devices must either destroy or abandon them at an ATF office, to avoid
prosecution. Because the prohibition on possession involved an exercise of the government’s
police power, there was no taking within the meaning of the Fifth Amendment.
In Akins v. United States, 82 Fed. Cl. 619, 623 (2008), the court similarly concluded that
ATF was exercising police power when it reclassified another bump-stock-type device—the so-
called “Akins Accelerator”—as a machinegun, and directed the owners of the device to surrender
its recoil springs. The court reasoned that when ATF classified the Akins Accelerator as a
machinegun and ordered its inventor to surrender the springs, it was acting under its authority to
enforce 18 U.S.C. § 922(o), which outlaws the possession or transfer of machineguns. Id.
Because “ATF was acting pursuant to the police power conferred on it by Congress,” the court
concluded, the plaintiff had failed to state a claim under the Takings Clause. Id.
The United States District Court for the District of Maryland recently reached a similar
conclusion in Maryland Shall Issue v. Hogan. See generally 353 F. Supp. 3d 400 (D. Md. 2018).
It rejected plaintiffs’ claim that their property (bump stocks and similar devices) was taken
without just compensation as a result of a state law that made it unlawful for any person to
“‘manufacture, possess, sell, offer to sell, transfer, purchase, or receive a rapid fire trigger
activator’ or to ‘transport’ such a device into the state.” Id. at 405. The court observed that the
state legislature had “considered the ability of bump stocks and similar devices to inflict mass
injury and mass casualties with great speed, as well as their use to horrific effect in Las Vegas”
and “concluded that these devices pose such an unreasonable risk to public safety that they
should be banned from Maryland.” Id. at 410. It held that the law “falls well within Maryland’s
traditional police power to define and ban ultra-hazardous contraband” and so did not effect a
taking for public use within the meaning of the Fifth Amendment. Id. 2
The Court finds these decisions relevant and persuasive. The ATF regulation at issue here
was promulgated pursuant to statutory authority and consistent with our nation’s “historical
tradition of prohibiting . . . dangerous and unusual weapons.” District of Columbia v. Heller, 554
U.S. 570, 627 (2008) (internal quotation marks omitted). Weapons within these prohibitions have
included machineguns and others that are used primarily by the military in warfare. See id. at
624; Hollis v. Lynch, 827 F.3d 436, 451 (5th Cir. 2016) (observing that machineguns do not
receive Second Amendment protection “because they are dangerous and unusual and therefore
not in common use”); Akins, 82 Fed. Cl. at 624 (observing that the manufacture and sale of
firearms is “subject to pervasive federal regulation”). Banning the possession of such weapons
2
See also Ass’n of N.J. Rifle & Pistol Clubs, Inc. v. Att’y Gen. N.J., 910 F.3d 106, 124 n.32 (3d
Cir. 2018) (stating, in dicta, that New Jersey’s ban on large capacity magazines “seeks to protect
public safety and therefore it is not a taking at all,” and observing that “[a] compensable taking
does not occur when the state prohibits the use of property as an exercise of its police powers
rather than for public use.”) (citing Lucas, 505 U.S. at 1027–28, 1027 n.14; Mugler, 123 U.S. at
668–69; Nat’l Amusements Inc. v. Borough of Palmyra, 716 F.3d 57, 63 (3d Cir. 2013)).
10
and requiring their owners to divest themselves of such tools of war is the paradigmatic example
of the exercise of the government’s police power, which defeats any entitlement to compensation
under the Takings Clause.
The Court finds no merit in Plaintiffs’ contention that the police power doctrine does not
apply where, as here, the property owners came into possession of their bump-stock devices
lawfully and continued to lawfully possess them until the effective date of the ATF rule. 3
Plaintiffs have failed to cite a single case in which a court has found this distinction significant.
They also fail to point to a case that has found the police powers doctrine inapplicable in
circumstances where an individual is required to destroy or abandon property that was
designated as contraband after the owner first came into possession of it. See Samuels v.
McCurdy, 267 U.S. 188, 198–99 (1925) (finding no taking where liquor once lawfully purchased
and possessed was seized and destroyed pursuant to the police power under subsequent law
prohibiting liquor possession). As the district court in Maryland Shall Issue observed,
“[p]ractically all products later defined as contraband were not contraband before the enactment
of the law that named them as such.” 353 F. Supp. 3d at 409–10. Yet no court has ever ruled that
the government must compensate individuals who are required to divest themselves of dangerous
items if the ban on their possession is of recent vintage.
Moreover, the rationale of the police powers doctrine is that it is improper to “burden[]”
the government’s power to prohibit the use of property in a manner that endangers public safety
“with the condition that the state must compensate such individual owners for pecuniary losses
they may sustain, by reason of their not being permitted, by a noxious use of their property, to
inflict injury upon the community.” Mugler, 123 U.S. at 669. That rationale applies regardless of
whether the property now thought to present a danger to public health and safety was once
lawfully held.
In short, under ATF’s final rule, Plaintiffs’ bump-stock devices were not taken for a
public use, but were instead prohibited through the government’s exercise of its police power.
For this reason alone, Plaintiffs have failed to state a takings claim.
V. The Regulation Did Not Effect a Categorical Taking
Even if the police power doctrine were inapplicable, the Court would nonetheless dismiss
the complaint because there is no merit to Plaintiffs’ argument that the rule effected a categorical
taking of their bump-stock devices.
3
Citing the D.C. Circuit’s decision in Guedes, 920 F.3d 1 (described above), Plaintiffs go on at
some length in their opposition to establish that the rule at issue here is a “legislative,” rather
than interpretive one. See, e.g., Pls.’ Opp’n at 2–3. The purpose of this discussion, as the Court
understands it, is to show that until the regulation was enacted, there was no prohibition—
statutory or regulatory—against the possession of bump-stock devices. The Court sees no reason
to delve into this issue given its conclusion, discussed in the text, that the fact that the prohibition
was only recently enacted is irrelevant to the applicability of the police powers doctrine.
11
A. No Physical Taking
First, the final rule did not result in the physical appropriation of Plaintiffs’ bump-stock
devices. Instead, it imposed a criminal prohibition on their possession of bump-stock devices,
enforced by requiring their owners to either destroy them or abandon them at an ATF office for
destruction. In Plaintiffs’ case, in fact, the bump-stock devices were never turned over to the
government. Instead, Plaintiffs destroyed them on their own.
Plaintiffs’ reliance on Horne v. Department of Agriculture in support of their per se
physical takings argument is misplaced. The physical taking in that case arose out of a U.S.
Department of Agriculture marketing order which required raisin growers to set aside a portion
of their crop in certain years for the account of the government, free of charge. 135 S. Ct. at
2424. In accordance with the order, raisin growers were required to ship all of their raisins to a
raisin “handler” who would separate out the portion due the government and pay the growers
only for the remainder. Id. A “Raisin Administrative Committee” would take title to the raisins
allotted to the government (known as “reserve raisins”) and then dispose of them in various
authorized ways, including selling them in non-competitive markets or donating them to charity.
Id. Proceeds from sales were used primarily to subsidize handlers who sold raisins for export. Id.
The central issue before the Court in Horne was whether the government’s “‘categorical
duty’ under the Fifth Amendment to pay just compensation when it ‘physically takes possession
of an interest in property’” applied to personal as well as real property. Id. at 2425 (quoting Ark.
Game & Fish Comm’n v. United States, 133 S. Ct. 511, 518 (2012)). The Court answered that
question in the affirmative. Id. Further, it found that the reserved requirement effected “a clear
physical taking.” Id. at 2428. Actual raisins were transferred from the growers to the
government. Id. at 2424. Title to the raisins passed to the Raisin Committee. Id. And the
Committee “disposes of what become its raisins as it wishes” to promote the marketing order’s
purposes. Id. at 2428. Because the government took title to and then directly appropriated the
raisins for its own use, the Court held, it had effected a per se physical taking that required
compensation. Id. at 2426.
Here, by contrast, the ATF Rule did not effect a physical taking of Plaintiffs’ property.
Plaintiffs were not required to surrender possession of their devices to the government. There
was no transfer of title to the government. And if Plaintiffs had chosen to abandon their bump-
stock devices at the local ATF office, the agency would not have put the devices to its own use;
it would have destroyed them. The USDA regime of direct physical appropriation of private
property for the government’s own use is distinguishable from the criminal prohibition on
possession of personal property deemed dangerous, enforced by a requirement that the property
be destroyed or abandoned.
Indeed, in Horne itself, the Court acknowledged that, had the government simply
prohibited the sale of the raisins by the growers, it would not have effected a per se taking.
“[T]hat distinction,” the Court observed, “flows naturally from the settled difference in our
takings jurisprudence between appropriation and regulation.” Id. at 2428.
12
In short, there is no merit to Plaintiffs’ argument that the ATF rule effected a per se
physical taking of their bump-stock devices. The Court therefore turns to Plaintiffs’ alternative
argument that the rule effected a per se regulatory taking.
B. The Rule Did Not Effect a “Per Se Regulatory Taking”
Plaintiffs contend that even if the rule did not effect a physical taking, “it would,
nonetheless, be a per se regulatory taking.” Pls.’ Opp’n at 24 (emphasis removed). As explained
above, the Supreme Court has held that regulatory actions may result in categorical or per se
takings where they “den[y] all economically beneficial or productive use of land.” Lucas, 505
U.S. at 1015.
The Supreme Court has never decided whether and to what extent this standard applies to
personal property. As the Court explained in Horne, Lucas’s application of a categorical standard
to certain takings of real estate was grounded at least in part in the recognition “that while an
owner of personal property ‘ought to be aware of the possibility that new regulation might even
render his property economically worthless,’ such an ‘implied limitation’ was not reasonable in
the case of land.” Horne, 135 S. Ct. at 2427 (quoting Lucas, 505 U.S. at 1027–28).
In A & D Auto Sales, Inc. v. United States, the Federal Circuit noted that it had, “on
occasion,” applied the Lucas standard where it was alleged that personal property had been
rendered economically worthless. 748 F.3d 1142, 1151 (Fed. Cir. 2014) (citing Rose Acre
Farms, Inc. v. United States, 373 F.3d 1177, 1196–98 (Fed. Cir. 2004); Maritrans, Inc. v. United
States, 342 F.3d 1344, 1353–55 (Fed. Cir. 2003)). But A & D Auto Sales did not engage in any
analysis of the propriety of that approach given the Lucas Court’s recognition of the different
expectations attached to the regulation of personal as opposed to real property. Further, as the
court of appeals acknowledged in A & D Auto Sales, “other circuits view the Lucas test as
applying only to land.” Id. (citing Hawkeye Commodity Promotions, Inc. v. Vilsack, 486 F.3d
430, 441 (8th Cir. 2007); Unity Real Estate Co. v. Hudson, 178 F.3d 649, 674 (3d Cir. 1999));
see also Horne v. Dep’t of Agric., 750 F.3d 1128, 1140 (9th Cir. 2014), rev’d on other grounds,
135 S. Ct. 2419 (stating that it is clear the holding of Lucas is limited to cases involving land). It
appears, therefore, that the Federal Circuit has not squarely addressed whether and under what
circumstances the Lucas categorical regulatory taking standard applies to personal property. 4
Plaintiffs contend that the Supreme Court’s reference in Lucas to the “implied limitation”
on the expectations of owners of personal property is only applicable in the commercial context,
and not to the mere ownership or possession of personal property. See Pls.’ Opp’n at 25–26.
4
Neither of the two cases cited in A & D Auto Sales held that a categorical taking under Lucas
occurs where a government regulation renders personal property economically worthless. In
Rose Acre Farms, Inc., the court of appeals agreed with the trial court’s rejection of “the
government’s contention that a ‘per se’ takings analysis is never applicable when personal
property is at issue,” but found no such taking in that case. 373 F.3d at 1196 (emphasis supplied).
In Maritrans, Inc., the court of appeals applied the standard to personal property without
discussing the dichotomy between real and personal property discussed in Lucas, but ultimately
found that no categorical taking had occurred. 342 F.3d at 1353–54.
13
Thus, Plaintiffs argue that, in Lucas, the Court observed that “in the case of personal property, by
reason of the State’s traditionally high degree of control over commercial dealings, [an owner]
ought to be aware of the possibility that new regulation might even render his property
economically worthless (at least if the property’s only economically productive use is sale or
manufacture for sale).” Id. at 25.
Of course, the only economically productive use of bump-stock devices is in their sale,
manufacture for sale, or related commercial use. Plaintiff Paducah Shooter’s Supply, Inc., for
example, sells firearms and their accessories and operates a shooting range. It also previously
provided bump-stock devices for patrons to use when it held so-called “machine gun shoots.”
Compl. ¶ 11. Likewise, Plaintiff Roy Lynn McCutchen alleges that he has “purchased and owns
multiple bump-fire type devices for both his personal use and for economic gain.” Id. ¶ 10
(emphasis supplied).
Further, the Supreme Court’s observations regarding the relative expectations of owners
of personal property (as compared to owners of real property) surely apply to personal property
whose ownership itself is subject to pervasive government regulation, as is the ownership of
firearms in general, and machineguns in particular. Cf. Mitchell Arms v. United States, 7 F.3d
212, 213, 216 (Fed. Cir. 1993) (finding no enforceable rights sufficient to support a takings claim
where plaintiff whose license to import assault rifles was suspended and then revoked
“voluntarily entered the firearms import business, thereby knowingly placing itself in the
governmentally controlled arena of firearms importation”).
For these reasons, it appears to the Court that—even assuming there are circumstances in
which the Lucas categorical taking standard could be applied to personal property—it should not
be applied here. The Court therefore rejects Plaintiffs’ argument that the ATF rule effected a
categorical or per se regulatory taking of their property.
VI. Regulatory Taking Under Penn Central
Plaintiffs’ complaint appears to be based on the theory that the ATF rule effected a
regulatory taking under the Penn Central analysis. That analysis, as noted above, requires the
Court to balance several factors when deciding whether compensation is owed for a regulatory
taking. These include “[t]he economic impact of the regulation on the claimant,” “the character
of the governmental action,” and “the extent to which the regulation has interfered with distinct
investment-backed expectations.” Penn Cent., 438 U.S. at 124.
In opposing the government’s motion to dismiss, however, Plaintiffs do not argue that the
ATF rule effects a regulatory taking under Penn Central. Instead, they have chosen to rely upon
the categorical takings theories described above. Any argument based on Penn Central has
therefore been waived. See, e.g., Md. Shall Issue, 353 F. Supp. 3d at 413 n.5 (declining to
evaluate plaintiffs’ claims under the Penn Central test where the plaintiffs put forth only per se
takings theories).
In any event, even if the argument were not waived, Plaintiffs have failed to state a
regulatory takings claim under Penn Central. Plaintiffs have alleged that the ATF rule has
“destroyed all economic value” of their bump-stock devices. Compl. ¶ 41. But their allegations
14
are insufficient to establish a regulatory taking upon consideration of the character of the
government’s actions and the extent to which the rule interferes with reasonable investment-
backed expectations.
As the Supreme Court has observed, “the nature of the State’s interest in the regulation is
a critical factor in determining whether a taking has occurred, and thus whether compensation is
required.” Keystone Bituminous Coal Ass’n, 480 U.S. at 488. Where, as here, the government’s
action is aimed at protecting the public health and safety, that fact weighs strongly against
finding a regulatory taking. See, e.g., Dimare Fresh, Inc. v. United States, 808 F.3d 1301, 1311
(Fed. Cir. 2015) (finding that FDA press releases and media briefing warning consumers about
an outbreak of salmonella in tomato producers’ products did not effect a regulatory taking in part
because the agency was acting to protect public health and safety); Rose Acre Farms, 559 F.3d at
1281 (holding that a USDA regulation which mandated that egg producers remove diseased eggs
from the market was not a taking because the government was protecting public health); Appolo
Fuels, Inc. v. United States, 381 F.3d 1338, 1351 (Fed. Cir. 2004) (holding that the government’s
decision to declare a portion of a watershed unsuitable for mining under the Surface Mining
Control and Reclamation Act was “the type of governmental action that has typically been
regarded as not requiring compensation for the burdens it imposes on private parties who are
affected by the regulations” (quoting Rith Energy, Inc. v. United States, 270 F.3d 1347, 1352
(Fed. Cir. 2001))); Rith Energy, Inc., 270 F.3d at 1352 (holding that a federal agency’s decision
to revoke a coal mining permit “was an exercise of the police power directed at protecting the
safety, health, and welfare of the communities surrounding the Rith mine site by preventing
harmful runoff”).
Further, the regulation does not interfere with what can fairly be considered reasonable
investment-backed expectations. The investment-backed expectations factor “is designed to
account for property owners’ expectation that the regulatory regime in existence at the time of
their acquisition will remain in place, and that new, more restrictive legislation or regulations
will not be adopted.” Love Terminal Partners, L.P. v. United States, 889 F.3d 1331, 1345 (Fed.
Cir. 2018).
“[R]easonable investment-backed expectations are greatly reduced in a highly regulated
field.” Branch v. United States, 69 F.3d 1571, 1581 (Fed. Cir. 1995). The firearms industry is the
quintessential “highly regulated field.” It is subject “pervasive Government control.” Akins, 82
Fed. Cl. at 623 (quoting Mitchell Arms, Inc. v. United States, 26 Cl. Ct. 1, 5 (1992), aff’d, 7 F.3d
at 212). Anyone who enters the firearms industry has to be aware that shifting public sentiments,
evolving research concerning firearms availability and public safety, and events like the Las
Vegas mass shooting may lead to rule changes that render unlawful what was once permissible.
In particular, Plaintiffs could not have reasonably expected that existing rules regarding
bump-stock devices would not be made more restrictive. Such devices, after all, are designed to
enable semi-automatic weapons to simulate the firepower of machineguns, whose possession has
been prohibited for decades. 5
5
In their complaint, but not in their opposition to the government’s motion to dismiss, Plaintiffs
allege that their investment-backed expectations in the lawfulness of their devices were
15
Plaintiffs, in short, have waived any argument based on the Penn Central analysis by
failing to make it in opposing the government’s motion to dismiss. And even if the argument
were not waived, the Court concludes that they have failed to allege a regulatory taking claim
under Penn Central.
CONCLUSION
For the foregoing reasons, the government’s motion to dismiss for failure to state a claim
is GRANTED. The complaint will be DISMISSED with prejudice. The Clerk is directed to
enter judgment accordingly. Each side will bear its own costs.
IT IS SO ORDERED.
s/ Elaine D. Kaplan
ELAINE D. KAPLAN
Judge
reasonably based on prior ATF classification letters. Compl. ¶¶ 17–24, 42. But as discussed
above, classification letters lack the force and effect of law and are explicitly made subject to
subsequent changes in the law or regulations. See Lucas, 505 U.S. at 1027–28 (observing that an
owner of personal property “ought to be aware of the possibility that new regulation might even
render his property economically worthless”).
16