In a rare move, the Bureau of Alcohol, Tobacco, Firearms, and Explosives (ATF) revoked the firearm manufacturing license of Nevada-based JA Industries last week in response to a lawsuit, according to a new court filing.
ATF did not specify in the filing on what grounds the license was revoked.
The bureau’s decision came after a months-long inspection of JA Industries, which was prompted by a lawsuit alleging ATF violated federal laws by granting the license to the company.
JA Industries was founded by Paul Jimenez weeks after he filed bankruptcy for his problematic gun manufacturing company Jimenez Arms in Jan. 2020, according to the lawsuit.
Jimenez, through Jimenez Arms, allegedly mailed handguns across states to a gun trafficker, mispresented facts of operations to ATF, and violated its recordkeeping rules, which would have disqualified him from being granted a new license the lawsuit alleged.
The lawsuit—filed by Illinois, Kansas City of Missouri, and Everytown for Gun Safety Support Fund—seeks a judge’s order to invalidate JA Industries’ manufacturing license.
“This is the first time we are aware of that the ATF has reversed a licensing decision in response to litigation,” according to Noah Levine, deputy press secretary at Everytown for Gun Safety.
In Illinois and Kansas City cheap handguns made by Jimenez Arms turned up at crime scenes at a rate disproportionate to the company’s market share, according to the lawsuit.
Between 2014 and 2018, Chicago police recovered 378 Jimenez Arms pistols, while Kansas City police recovered, seized, or held as evidence at least 166.
In Kansas City, Jimenez did business with convicted gun trafficker James Samuels for years. Of the 77 firearms that Samuels is known to have trafficked between 2013 and 2018, 57 were Jimenez Arms pistols.
When Jimenez Arms went bankrupt, Everytown for Gun Safety purchased the entire inventory of pistols and pistol frames, valued at $12,571, to prevent Jimenez from purchasing it himself to start a new manufacturing firm, according to the lawsuit.
Then Everytown for Gun Safety worked with professionals to destroy the weapons it had purchased, which cost an additional $6,850.
Everytown for Gun Safety Support Fund is a nonprofit organization that conducts research, develops policies, and engages in litigation related to gun-related violence on a national level.
The three plaintiffs alleged that ATF unlawfully allowing Jimenez to continue his manufacturing businesses through a new license hurt their interests.
Also, the lawsuit alleged that Jimenez made false and misleading statements to the bureau about his business involvement with a convicted felon Bruce Jennings.
In addition, ATF cited Jimenez Arms with recordkeeping violations during two routine inspections in 2012 and 2017, according to the lawsuit.
Now the bureau has revoked JA Industries’ license, the lawsuit is expected to be dismissed, according to the court filing.
Just days ago, President Joe Biden called for a 13 percent budget increase, or $1.7 billion, for ATF in his 2023 fiscal budget.
Part of the funding will be used to hire 300 agents, investigators, and personnel to crack down on the pipeline of illegal firearms used in crimes, according to a White House press release.