Vahan Kelerchian v. Bureau of Alcohol Tobacco Fire
20-3065
| 3rd Cir. | Jul 12, 2021Background
- Vahan Kelerchian, a federally licensed firearms dealer, was convicted of federal offenses and sentenced; his appeals failed and certiorari was denied.
- Within 30 days of sentencing he submitted an application under 18 U.S.C. § 925(c) for restoration/protection; ATF returned the form as “unprocessed,” citing an annual appropriations ban barring ATF from acting on § 925(c) applications.
- Kelerchian re-sent the form; ATF did not process it or otherwise respond. He then sued ATF seeking declaratory and injunctive relief, alleging an ATF “internal policy” denied the § 925(c) protection.
- District Court dismissed for lack of subject matter jurisdiction and denied reconsideration/leave to amend, entering dismissal with prejudice.
- Third Circuit held the district court erred to dismiss for lack of jurisdiction (K sought the statutory “protection,” not an order directing ATF to grant/deny the application), but concluded the complaint failed to state any viable claim (no private right under § 925(c); no final agency action alleged under the APA).
- The Third Circuit affirmed dismissal but vacated the dismissal-with-prejudice and the denial of leave to amend, permitting Kelerchian an opportunity to amend.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| 1) Subject-matter jurisdiction given the appropriations ban | Kelerchian: he seeks the statutory “protection” of §925(c) (ability to continue licensed operations while final action is pending), not an order requiring ATF to grant or deny his application | ATF: appropriations rider bars ATF from investigating/acting on §925(c) applications; Bean/Pontarelli mean courts lack jurisdiction over §925(c) disputes | Court: jurisdiction exists — K seeks a legal declaration of §925(c)’s protective effect, not an order forcing ATF to grant/deny; appropriations ban does not strip jurisdiction for that relief |
| 2) Whether §925(c) provides a private right or enforceable cause of action | Kelerchian: §925(c) and implementing regulation authorize declaratory and injunctive relief | ATF: §925(c) contains no express private right; courts should not imply one | Court: §925(c) contains no express or implied private right of action; Count I fails |
| 3) Whether APA claim challenges a final agency action | Kelerchian: ATF’s “internal policy” (as communicated by counsel) constitutes agency action subject to APA review | ATF: no final agency action was taken; mere statements or returned forms are non-final and not reviewable | Court: complaint fails to plead a final agency action under Bennett standards; Count III fails |
| 4) Dismissal with prejudice and leave to amend | Kelerchian: should be allowed to amend after being told of defects | ATF: dismissal appropriate; amendment futile | Court: dismissal is proper but on failure-to-state-a-claim grounds; district court erred in dismissing with prejudice without allowing amendment — vacated prejudice and denial of leave to amend |
Key Cases Cited
- United States v. Bean, 537 U.S. 71 (2002) (ATF inaction is not a statutory “denial” under §925(c))
- Pontarelli v. Dep’t of Treasury, 285 F.3d 216 (3d Cir. 2002) (en banc) (similar holding limiting review of §925(c) applications absent agency denial)
- Bennett v. Spear, 520 U.S. 154 (1997) (final agency action test for APA review)
- Alexander v. Sandoval, 532 U.S. 275 (2001) (limitations on implying private rights of action)
- Chehazeh v. Att’y Gen., 666 F.3d 118 (3d Cir. 2012) (APA provides limited cause of action for those adversely affected by agency action)
- Shane v. Fauver, 213 F.3d 113 (3d Cir. 2000) (futility standard for denying leave to amend)