ARES raided!!

[Sam1911]

Exactly we need it written in stone what a gun is. It shouldn't be decided on the whim of a political appointee.

Well...that would be nice in some ways, but pretty hard. There's a thousand variations, and hundreds of parts which could constitute a gun or might not, alone or together, and us ingenious gun types keep coming up with new variations and ways of doing things. If the law had to be changed every single time someone invented a new type of receiver or assembly, that would be terribly hard to administer. Heck, the LAW gives certain definitions of firearms, and the bare receiver of any gun would not meet those definitions. So therefore, stripping a gun down to its parts would render it no longer a firearm, right? But that's not going to fly. So the ATF is given the responsibility of making decisions on what things ARE, and what rules apply to them so they can effectively administer the law.

If that wasn't the case, we'd probably end up with a situation were all new things were ILLEGAL until Congress got around to deciding which end was up in each case.

There's lots of areas (probably every aspect of public intercourse which is regulated) where government agencies are given the responsibility to make rules and binding decisions about how the law they're enforcing is applied. That's just not going to change.

 

[wildbilll]

It's clear to me from the interview that they had a backup copy of the sales software. If it were me, after I restore that software and data file to the new computers, I would make sure the computers have TrueCrypt installed on them and make continuous off site backups of that encrypted data.

 

[Sam1911]

Arbitrary and Capricious.

Possibly. Especially if they've very clearly reversed a prior declaration to this maker that the product would be a non-firearm. Otherwise, well, they've got the authority to make decisions and they have to draw the line somewhere. It probably won't be hard for them to establish that drawing the line here, not there, is within their purview.

Equal protection.

Ok, how so? I'd think two manufacturers would have to be making exactly the same product, and one be told "yes" and the other "no" to make that claim. I don't think that's the case here.

Taking of property.

Ok, clearly. But if it is declared to be "over the line" and contraband, that's pretty much that. The ATF has a long history of that sort of taking. (See the Akins Accelerator, again.)

There might be some traction in the fact that the BATFE hasn't brought charges, because if this thing is being sold against the law shouldn't they charge the seller and maker with a crime? But the BATFE can probably pretty easily point out that they COULD do so, but because of the knotty technical questions over the part they'll be satisfied with stopping the practice and aren't going to be mean-nasties and put folks in jail over it. NOT prosecuting would be within their rights to do as well.

I suppose EP and ARES could sue to FORCE the BATFE to throw them in jail...

Yes, it's a court battle.

Well, that's what I'm asking. IS IT? Is there a court case here that could be brought? CAN the BATFE even be sued over such a thing? I just don't know the answer.

Will they have enough cash for this?

I can't imagine how, on their own. If there's enough of a winnable case, I suppose the NRA, SAF, and/or NSSF might chip in. But...Akins again, you know?

Will it pay off later?

Well, one way or another there will probably be fallout. Might be a tightening of practices for a while. Might be a court case or three. Might be a total restructuring of the BATFE so this sort of thing never happens again. I don't think I'll hold my breath for the last one.

Was the real reason for this raid to cause a chilling effect? According the radio interview, they are open for business as usual. How many people will be willing to purchase one of these lowers given the prospect of a BATFE raid on themselves because the government can get the list of names?

I don't imagine there's a deeper "real" reason. I imagine that the Tech Branch was asked to take a look at these EP lowers and make a call on whether they were firearms or not. Once the call was made, YUP!, then there's not a whole lot of leeway to just ignore the situation.

And I'd be surprised if EP and ARES haven't seen a huge UPTICK in sales and inquiries since this happened! There's no way in the world they'd have ever got this much press any other way. Yes, it's "scary" press, but a whole lot of of folks would be willing to plunk down a few bucks for one of these lowers just as a seeming "flip o' the bird" to the BATFE, knowing that the worst thing that will ever happen to them is that they get a call and have to surrender it later on.

 

[wildbilll]

Now we have this additional information. This may be coincidental, but it appears that Ares was asking (through their attorney) if it was OK to do what these criminals were doing. (Page 86 of the document)

These other people were selling a "blank" and were directing and assisting the customer in the completion of the lowers from the blanks. It appears some of them they thought they were legal helping out the customer, but later realized it was wrong, but it was too late.

The reason this is posted here is because the search warrant includes the letter of inquiry from Ares, where they proposed that a customer who purchased a metal blank elsewhere could come in and use the Ares machinery and receive guidance on finishing the blank into a lower.

Nothing in the warrant suggests Ares ever actually did anything but ask if it was OK to do it. The letter from the Government that says "no, you can't do that" seems to be the basis in how the other people suddenly found Jesus and tried to clean up their act. (Page 15)

http://www.justice.gov/usao/cae/news/docs/2014/2014_02/02-27-2014Cortez SW Package.pdf

 

[Sam1911]

Yeah...hope they weren't doing that.

 

[wildbilll]

And here is the DOJ response the Ares's slick move to buy time to get the TRO:

http://www.scribd.com/doc/212487675/DOJ-Response-Ares-Armor

This document includes the modification to the TRO adding the words "Clarifying that Temporary Restraining Order Does Not Restrain Lawful Criminal Proceedings", the basis for the raid to go forward.

Basically, they got mad because he pulled a end run on them and they are trying to save face.
And we were right, this is about the step of manufacture, they are alleging the lowers are made prior to the insertion of the white plastic.

 

[CoalTrain49]

At some point in the manufacturing process you have some Aluminum, maybe a raw casting that looks a little bit like an AR-15 lower receiver, but can't work like one and is more or less just a paperweight. At the end of the process, you have a working lower receiver which must have a serial number and be transferred as a "firearm."

The ATF has been approached by numerous makers of AR-15 receivers and asked where in the manufacturing process they could stop, and still sell the uncompleted chunk of aluminum as just a chunk of aluminum -- NOT a firearm, having to be transferred on a 4473 form. The ATF has sent out a number of letters approving this or that version of an incomplete receiver as NOT a firearm. Maybe some of the pin holes aren't drilled. Maybe the firing control group void isn't machined out. But the really HARD parts (casting, complex milling, anodizing the exterior, etc.) are all done.

That lets makers sell these things through the mail, to anyone, anywhere they want. The final buyer can, if s/he is so skilled and has the tools, then finish the last milling steps and turn the incomplete chunk of aluminum into a working firearm.

As a private individual, "making" a firearm this way means you don't have to pay transfer fees, the manufacturer's price for the incomplete chunk is lower than for a finished receiver, there is no form 4473 sitting in some dealer's folder with your name on it, and no serial number in the manufacturer's files that could be traced back to you. An "unpapered" but perfectly legal gun.

Considering that most of us would prefer that guns were not easily tracked down by "the gubmint," the UN Blue Helmets, the Chinese, space aliens, or whomever, the idea of a legal gun without any paper trail is pretty appealing.

Got it, thanks.

So we now have a complete AR where someone purchased an 80% lower and completed the work in a machine shop. It's not legal until someone with a FFL applies for a SN and stamps the receiver, correct? Would it not be the same as me building any receiver in my shop. The receiver still needs a SN and to get one I have to have a license. Otherwise it's jail time.

Why does the ATF feel they need to regulate something like a receiver until it's actually built and can accept the hardware that allows it to function?

Eric Holder should know this stuff. After all he didn't walk a bunch of 80% lowers into Mexico. What would be the point?

 

[Sam1911]

So we now have a complete AR where someone purchased an 80% lower and completed the work in a machine shop. It's not legal until someone with a FFL applies for a SN and stamps the receiver, correct?

Well, no, usually these are completed by home hobbyists. In the case of the polymer EP lower, their big selling point is that you don't even need a jig, and can complete one in an hour or so with very simple tools.

If you make your own receiver, you DON'T have to apply a serial number and there is no need for an FFL. That's for your personal use. (If you're making them to sell, that's a big problem.)

Would it not be the same as me building any receiver in my shop. The receiver still needs a SN and to get one I have to have a license. Otherwise it's jail time.

Nope. No serial number needed. No license needed. Build all you want for your own use. Don't have to register it, tell anyone, or do anything but go shoot it.

Why does the ATF feel they need to regulate something like a receiver until it's actually built and can accept the hardware that allows it to function?

They are charged with regulating the sale of firearms. These are sold as "not quite" firearms yet, but the obvious intent is that folks will take them home and "make" their own firearms with them. At some point in the manufacturing process, the BATFE kind of has to declare that an item is a firearm, and so has to be sold like a firearm, or isn't a firearm and can be sold like a loaf of bread or a door stop.

These folks are RIIIIIIIGHT on the line, making a lower that is so easy to complete that the ATF is saying we're going to call it a firearm and say it has to be sold with a serial number and 4473 form.

Eric Holder should know this stuff. After all he didn't walk a bunch of 80% lowers into Mexico. What would be the point?

Like I said before, a bare receiver isn't a "firearm" under the wording of the law. You can't shoot someone with a bare AR-15 receiver. However, in order to administer firearms law effectively the BATFE has to declare what is the controlled part.

Since the rise of home builders, the BATFE has had to come up with some way to decide when a firearm is "born" and at what point a gun is a gun. "Our side" pushes the limit just as far as we can go, and maybe a little farther, and every once in a while, the BATFE pushes back and says, "Woah!"

 

[Krusty783]

After reading what wildbill linked above, I think what Areas was doing is really shady and any reasonable person would agree that they were manufacturing firearms.

If you didn't read it, here's the summary:
-A "customer" brings an 80% lower to Ares, pays a fee & puts it in an Ares-owned & programmed CNC machine and hits the go button.
-Later the program pauses and the "customer", under supervision of an Ares employee, repositions the casting and hits the go button again.
-The machine runs till the end of the program and out pops a complete AR lower.
-Ares tries to say they didn't "manufacture" it because the "customer" pushed the go button on the mill.... BS Ares profited from the manufacturing of the lower receiver by receiving a fee for facilitating and supervising the process in their machines in their shop.

Using Ares' logic, I could put some gloves on, punch my boss in the face and then argue to HR that the gloves actually assaulted him, not my fist...

I could see providing a casting/forging and a dimensioned drawing and leaving the machining completely to the customer. But what Ares did was over the line and an obvious attempt to skirt the letter and intent of the law, IMO. I don't know if it was right or wrong, but it was obviously illegal.

Even a company selling 80% lowers and jigs for drilling out the pin holes is getting kinda close for my taste. Selling either one (lowers or jigs) is okay in my book, but selling both together is getting pretty close to the line.

 

[Sam1911]

If you didn't read it, here's the summary:
-A "customer" brings an 80% lower to Ares, pays a fee & puts it in an Ares-owned & programmed CNC machine and hits the go button.
-Later the program pauses and the "customer", under supervision of an Ares employee, repositions the casting and hits the go button again.
-The machine runs till the end of the program and out pops a complete AR lower.
-Ares tries to say they didn't "manufacture" it because the "customer" pushed the go button on the mill.... BS Ares profited from the manufacturing of the lower receiver by receiving a fee for facilitating and supervising the process in their machines in their shop.

Hold on, that was ANOTHER situation. ARES ASKED if that would be legal, but didn't actually DO it. Another company was doing that and got nailed. That's what wildbill linked to.

 

[CoalTrain49]

Like I said before, a bare receiver isn't a "firearm" under the wording of the law. You can't shoot someone with a bare AR-15 receiver. However, in order to administer firearms law effectively the BATFE has to declare what is the controlled part.

Since the rise of home builders, the BATFE has had to come up with some way to decide when a firearm is "born" and at what point a gun is a gun. "Our side" pushes the limit just as far as we can go, and maybe a little farther, and every once in a while, the BATFE pushes back and says, "Woah!"

The BATFE really screwed this up. If they were thinking (I know, it's the gov't) they would have made the chambered barrel the controlled part. That's the hardest part to build because of the 55,000 psi chamber pressure and the precision tools and cuts. I'm pretty sure you can't whip one of those out in your average shop and you can't make one out of polymer.

I wonder if anyone working for the BATFE ever wonders if they are on a fools mission? Probably not.

 

[Sam1911]

Ok...but then anytime someone wanted to replace or swap out a barrel, they'd have to buy a brand new firearm. The barrel is the wear item, not the receiver. Kind of like saying the engine IS the car, and putting a new engine in your car requires a new title.

Fool's mission? Well, absolutely! If you've read through the US code, going back to the National Firearms Act of 1934, and tried to apply everything exactly as written to the near infinite variety that is the wonderful world of guns, it would make you pull your hair out. But that's what the BATFE has to do. They didn't write the law, and the law doesn't make a whole lot of sense in many places and in many cases, but it is their job to try to apply the law.

They don't really have the ability to throw up their hands and say, "Ahhh, screw it, I'm going fishing." But every once in a while you get a glimpse that they're about at wit's end trying to make a million square pegs fit into round holes.

 

[Krusty783]

Oops, yeah I misread the first part of the Ares Letter...

But from what I read they're finishing poly lowers and then back-filling them with a different colored material for the end user to remove... That's still kinda shady, IMO.

I'm sure the ATF is stretched pretty bare with trying to regulate everything in their purview these days. If they want more $ they should expedite the tax stamp switchover to e-filing, raise the price to $300 and double the examiner staff.

 

[Claude Clay]

barnbtw -- "The ATF is the IRS. They're both ostensibly tax collectors, and the exact kind of entities that broke us from England in the first place."

Claire Wolfe -- "America is at that awkward stage. It's too late to work within the system, but too early to shoot the b***ards."

sure seems the power brokers are doing their best to move the date up

 

[JRH6856]

They don't really have the ability to throw up their hands and say, "Ahhh, screw it, I'm going fishing."

Sounds like "going fishing" is exactly what they are doing with Ares.

 

[Analogkid]

Where are you reading that? Ep Armory has stated from the get go that the lowers are made Around the trigger control group area polymer. From the vids I see of guys machining these I would say thats correct.

From a manufacturing standpoint it would for sure be easier to injection mold the lower then squirt polymer into it.

But if it comes out in the wash they make the captive plug first and then the lower is formed around it....
The ATF made a mistake...

 

[JRH6856]

But from what I read they're finishing poly lowers and then back-filling them with a different colored material for the end user to remove... That's still kinda shady, IMO

From what I read, that is what BATF claims EP is doing. EP claims they are building the poly lower around the different colored material, not inserting it in a finished lower. But if they did not get an approval letter from BATF first, what they claim may not matter at all.

 

[JRH6856]

But if it comes out in the wash they make the captive plug first and then the lower is formed around it....
The ATF made a mistake...

But that is the point Sam has made several times: It is the ATF that decides what is and what isn't a firearm and does so on a case by case basis, and may reverse itself if it deicdes it made a mistake in approving something in the first place.

Of course, if EP did not get approval in the first place, there is nothing to reverse and ATF can decide just about whatever it wants.

 

[Frank Ettin]

We see these kinds of thing in a variety of different contexts. Say that there's a pretty much for sure way to do something legally. But that way is hard and/or expensive and/or time consuming and/or requires special knowledge, training and skill. So folks start coming up with alternative ways to do that thing which are easier and/or cheaper and/or quicker and/or don't require as much knowledge, training or skill.

The only thing is that the easier ways are enough different from the hard way that they might not be as unquestionably legal as the hard way. So that might be a matter that will need to be sorted out in court.

So it's legal for someone without a license or regulator approval to make a gun (other than an NFA gun) from scratch all by himself. So he could buy some hunks of metal and do all the machining, heat-treating and whatever else necessary to turn that metal into a fully functional Title I gun.

A buddy of mine is a retired engineer, an accomplished blacksmith and has a pretty complete machine shop. He could do that if he wanted to. But he prefers to buy his guns ready made and spend his time doing other things.

But he has special skills and special tools that a lot of folks don't have. So some people got into the business of making special hunks of metal (or polymer) that begin to look like gun parts and require a lot less work to turn into a functioning gun part than a piece of raw metal or polymer. Other people offer access to special machines or advice or instruction or help.

Now the line between a gun made all by yourself and a gun made by someone else starts to get a lot fuzzier.

Some folks have varying ideas about where that line is or ought to be. But (1) there's probably a lot here we don't know, and details can matter a great deal; and (2) it's likely that whatever we think the question will ultimately have to be resolved by a judge.

 

[Sam1911]

Frank, do you happen to know what the path is for ARES and EP to try to fight this if, as it appears could likely happen, the BATFE decides to take the lowers and issue a cease and desist order, but not prosecute anyone?

Can they bring a suit against the BATFE? What could they gain by doing so?

And taking it a step farther, is there some process by which they could push for a reversal of the BATFE decision on their lowers? How would it be possible to have one of their regulatory decisions (e.g.: "This item IS a firearm.") overruled?

 

[goon]

After reading what wildbill linked above, I think what Areas was doing is really shady and any reasonable person would agree that they were manufacturing firearms.

There was another company selling 80% lowers, then allowing customers to head into the back room to finish the lower with the company's tools and help from its employees (one of whom was apparently an felon and an illegal immigrant). That wasn't ARES as far as I know, but they did apparently ask if doing that was legal. Asking if something is legal isn't the same thing as committing a crime.

To me, that doesn't say that ARES was doing anything "shady" by selling an uncompleted lower. Uncompleted 80% lowers are available in lots of places and they're no different than a block of aluminum or a chunk of polymer UNTIL they're modified into a complete receiver. At least that's what the ATF would have said before.

http://www.quentindefense.com/downloads/ATF Letter Non Gun.pdf

Personal opinions on the ATF aside, the issue here is that we need to have some kind of accepted standard on what is or is not going to get us in trouble, then the ATF has to stick to it. To me, it looks like the ATF is trying to switch up the rules in the middle of the game... and that looks like a good way to make non-criminals into criminals in about ten seconds.

 

[wildbilll]

It's called injunctive relief. That is what is coming next according to the Ares guy in the radio interview.

What we have here is a belief by BATFE that the insert was put in after the receiver was made.
I say this because in the DOJ response that lead to the modification of the TRO, the agent claims he told the guy that they would take the lowers, examine them and IF they decided the parts were made in accordance with the law, they would return them.
Thus, at the time BATFE was offering this voluntary surrender of the parts( instead of a warrant and confiscation) they did not have probable cause that the parts were unlawfully manufactured.
Instead they had a suspicion not based on any fact.

The BATFE should have purchased one (or asked Ares to supply one) exemplar, then they could have done an analysis on that one.

Instead, we have BATFE defacto trying to regulate the product that is actually a non-regulated product. Absent a finding the receivers are not compliant, they have overreached their regulatory authority.
In the event the receivers are ruled non-compliant, there will be a federal lawsuit against DOJ claiming the application of these rules are arbitrary and capricious, and I am guessing they throw in all of the civil rights violations, plus violation of the administrative procedures act (if they are changing rules without following those laws).

 

[Frank Ettin]

Frank, do you happen to know what the path is for ARES and EP to try to fight this if, as it appears could likely happen, the BATFE decides to take the lowers and issue a cease and desist order, but not prosecute anyone?...

Sam, I really couldn't say. The best or available strategies for both ARES and EP depend on exactly what happened, when and how. I believe that EP and probably ARES as well have been on ATF's radar for a while, and I suspect that has been a lot of activity leading up to the current situation -- including discussions and correspondence. What has gone on before will influence how things will need to be handled going forward.

A number of things could happen.

1. I believe that EP is licensed by ATF. ATF could revoke EP's license, and EP could challenge that, first administratively and then in court.
   
   
2. ATF could seek an indictment against ARES. If ARES is indicted, it would of course be defending against those charges.
   
   
3. ARES and/or EP could bring a suit for declaratory relief in federal court. That would basically be a way to resolve the question of the legality of their activities.
   
   
4. The most likely next steps would be discussions among ATF, EP and ARES to common to a common understanding of what would and would not be legal and probably resulting in ARES and EP changing the ways in which they do business.

But again all of that is speculative, and what will really happen going forward will depend on a lot of things we don't know.

 

[JRH6856]

Absent a finding the receivers are not compliant, they have overreached their regulatory authority.

Except that part of ATFs regulatory authority is deciding what is or is not compliant. ATF offered to examine the part and make a determination. They were refused the oppertunity to examine the part. So they made a determination based on a description which AFAIK, is within their authority to do. So exactly where is the overreach?

 

[Sam1911]

Personal opinions on the ATF aside, the issue here is that we need to have some kind of accepted standard on what is or is not going to get us in trouble, then the ATF has to stick to it.

One of the most common themes we see in threads on any matter of NFA or other serious firearms technology law is that YOU must have a formal letter of finding from the ATF Tech Branch for the specific "thing" you want to make or do. Saying, "Mine is sort of like his, and he's got a letter..." isn't really any guarantee that YOURS will be found to be equally protected by HIS letter. Further, when the ATF changes their mind later, in another letter, if you have a letter TO YOU saying that YOU may do X,Y,Z, that's pretty good protection. But if you found someone else's letter on line saying THEY can do V,W,X and you're counting on it to cover the X,Y,Z YOU want to do, you're probably riding on a false hope. These things are well known and oft repeated.

EP makes something a bit different from other "80%" lowers. Unique. Easy to finish. If they have a letter, addressed to them, saying that their process is fine, then they're probably in pretty good shape. They might lose their inventory and have to stop what they're doing, but they probably won't be prosecuted for a crime.

If they don't have an official determination in hand, approving their version? No bueno.

To me, it looks like the ATF is trying to switch up the rules in the middle of the game...

Again, hard to say. When you stand so close to the line that any hair that falls off your pinkie toe is going to land on the far side of it ... well, you know you're playing a high-stakes game, and you'd better be DANGED sure you know where you stand. It's a bit like the guy wanting to cut his rifle barrel down to 16.0001" ... better measure DARNED carefully. Most of us would cut it to 16-1/4" just for safety's sake.

and that looks like a good way to make non-criminals into criminals in about ten seconds.

Well, again, no one's been charged with a CRIME (yet?). So it might cause a maker to waste a lot of material and time on un-sellable contraband that's just going to get confiscated, but they haven't been declared criminals, to my knowledge.