Wilborn v. Bureau of Alcohol, Tobacco, Firearms and Explosives

Filing 13

MEMORANDUM OPINION. Signed by Judge Abdul K Kallon on 10/30/2014. (PSM)

FILED
2014 Oct-30 AM 08:46
U.S. DISTRICT COURT
N.D. OF ALABAMA

UNITED STATES DISTRICT COURT
FOR THE NORTHERN DISTRICT OF ALABAMA
NORTHEASTERN DIVISION
DENNIS HAL WILBORN, d/b/a Wilborn
Outdoors,

)
)
)
Petitioner,
)
)
vs.
)
Bureau of Alcohol, Tobacco, Firearms, and )
Explosives,
)
)

Civil Action Number
5:14-cv-00991-AKK

Respondent.

MEMORANDUM OPINION
The Bureau of Alcohol, Tobacco, Firearms, and Explosives (“the ATF”)
stripped Dennis Wilborn, doing business as Wilborn Outdoors, of his federal
firearms license after repeat violations of the Gun Control Act (“GCA”). As a
result, Wilborn petitioned the court for a de novo review of the ATF’s decision.
Doc. 1. The ATF has filed a motion to dismiss and, alternatively, a motion for
summary judgment, docs. 6, 7, which is fully briefed, see docs. 11, 12, and ripe for
review. Because the parties have submitted affidavits and other exhibits in support
of and in opposition to the motion, the court construes this motion solely as a
motion for summary judgment. See Garfield v. NDC Health Corp., 466 F.3d 1255,
1260 (11th Cir. 2006). Based on the evidence and the law, for the reasons stated

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fully below, the court finds that the ATF has established that Wilborn willfully
violated the GCA, and that its motion is due to be granted.
I.

SUMMARY JUDGMENT STANDARD OF REVIEW

“Notwithstanding the posture of this action as an appeal from an ATF
administrative decision, the summary judgment standard is unchanged.”
Willingham Sports, Inc. v. ATF, 348 F. Supp. 2d 1299, 1307 (S.D. Ala. 2004)
(hereinafter Willingham Sports I). Under Rule 56(a) of the Federal Rules of Civil
Procedure, summary judgment is proper “if the movant shows that there is no
genuine dispute as to any material fact and the movant is entitled to judgment as a
matter of law.” Rule 56 “mandates the entry of summary judgment, after adequate
time for discovery and upon motion, against a party who fails to make a showing
sufficient to establish the existence of an element essential to that party’s case, and
on which that party will bear the burden of proof at trial.” Celotex Corp. v.
Catrett, 477 U.S. 317, 322 (1986). The moving party bears the initial burden of
proving the absence of a genuine dispute of material fact. Id. at 323. The burden
then shifts to the nonmoving party, who is required to “go beyond the pleadings” to
establish that there is a “genuine issue for trial.” Id. at 324 (citation and internal
quotation marks omitted). A dispute about a material fact is genuine “if the
evidence is such that a reasonable jury could return a verdict for the nonmoving
party.” Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248 (1986). When
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reviewing a license revocation by the Attorney General, summary judgment is
appropriate where “there is no genuine issue of material fact about whether [a
licensee’s] continued and repeated failure to comply [with the GCA] was willful.”
Willingham Sports, Inc. v. ATF, 415 F.3d 1274, 1278 (11th Cir. 2005) (hereinafter
Willingham Sports II).
The court must construe the evidence and all reasonable inferences arising
from it in the light most favorable to the non-moving party. Adickes v. S. H. Kress
& Co., 398 U.S. 144, 157 (1970); see also Anderson, 477 U.S. at 255 (all
justifiable inferences must be drawn in the non-moving party’s favor). Any factual
disputes will be resolved in the Plaintiff’s favor when sufficient competent
evidence supports the Plaintiff’s version of the disputed facts. See Pace v.
Capobianco, 283 F.3d 1275, 1276, 1278 (11th Cir. 2002) (a court is not required to
resolve disputes in the non-moving party’s favor when that party’s version of
events is supported by insufficient evidence). However, “mere conclusions and
unsupported factual allegations are legally insufficient to defeat a summary
judgment motion.” Ellis v. England, 432 F.3d 1321, 1326 (11th Cir. 2005) (per
curiam) (citing Bald Mountain Park, Ltd. v. Oliver, 863 F.2d 1560, 1563 (11th Cir.
1989)). Moreover, “[a] mere ‘scintilla’ of evidence supporting the opposing
party’s position will not suffice; there must be enough of a showing that the jury

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could reasonably find for that party.” Walker v. Darby, 911 F.2d 1573, 1577 (11th
Cir. 1990) (citing Anderson, 477 U.S. at 252)).
II.

FACTUAL BACKGROUND

Wilborn held a Federal Firearms License authorizing him to sell firearms at
his store in Cullman, Alabama. 1 Doc. 7-3 at 1. In 2011, the ATF inspected
Wilborn Outdoors and determined that Wilborn failed to timely record the
acquisition and disposition of multiple firearms, in violation of 18 U.S.C. §
923(g)(1)(A) and 27 C.F.R. § 478.125(e), and to report the multiple sale of
handguns, in violation 18 U.S.C. §923(g)(3)(A) and 27 C.F.R. § 478.126(a). Doc.
7-30 at 1-6. An ATF investigator subsequently reviewed the violations with
Wilborn and requested corrective action. Id. at 1. Additionally, a senior ATF
official held a “warning conference” with Wilborn, id. at 3; doc. 7-38 at 14-16,
which the ATF followed up with a letter informing Wilborn that additional
violations “could be viewed as willful” and “may result in the revocation of [his
federal firearms] license, and that further inspections by the ATF should be
expected.” Doc. 7-32 at 1-4.

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Wilborn Outdoors held Federal Firearms License number 1-63-043-01-4L-33996.
Doc. 7-3 at 1. Wilborn disputes the ATF’s claim that he does not currently hold a
federal firearms license, asserting that the Attorney General lacks the authority to
revoke his license. Doc. 11 at 2. This contention does not, however, qualify as a
dispute of material fact because whether the Attorney General possesses the
authority to revoke Wilborn’s license is a legal question and, ultimately, the main
issue underlying this litigation.
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In response to the citations and warnings, Wilborn implemented new record
keeping processes, spending “thousands of dollars in employee time training [his]
staff and updating [his] procedures.” Doc. 11-1 at 2; see also docs. 7-1 at 1;7-39 at
22; 7-40 at 1-3. Wilborn also rearranged the store to better protect his guns from
theft. Doc. 11-1 at 1. Finally, Wilborn and several staff members tried to attend an
ATF training seminar at the Madison Library in Madison, Alabama, but found out
that the seminar was actually at a different library with a similar name. Docs. 7-2;
7-39 at 15-17.
Consistent with the warning letter, ATF Investigator John Woodruff
(“Woodruff”) inspected Wilborn Outdoors in May and June of 2013. Doc. 7-29 at
1-5. After reviewing the records and inventory, doc. 7-37 at 14-16, Woodruff
determined that Wilborn Outdoors had violated several provisions of the GCA.
First, Wilborn failed to timely record firearms sales and failed to file multiplefirearm-sales reports. 2 Docs. 7-29 at 1, 5; 7-38 at 13. Specifically, Wilborn
violated 18 U.S.C § 923(g)(1)(A) and 27 C.F.R. § 478.125(e) when he failed to
timely record the sale or disposition of 39 firearms identified in his acquisition and
disposition records (ADR). Docs. 7-4 at 2-4; 7-29 at 1. Second, Woodruff could
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Woodruff also cited Wilborn for the transfer of firearms to non-licensees prior to
contacting the National Instant Check System (NICS) to conduct a criminal
background check, failure to obtain and record complete and accurate information
required by Firearms Transactions Records Forms, failure to record results of
NICS checks on ATF Form 4473, and failure to sign as transferor of firearms and
to record the transfer date on ATF Form 4473. Doc. 7-29 at 1-5.
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not find 13 of the 39 firearms in Wilborn Outdoors’ inventory even though the
store’s records indicated that it had them in stock. Doc. 7-4 at 2-4. Third, Wilborn
also failed to keep his ADR consistent with his Firearms Transactions Records.
Doc. 7-37 at 15-16. Finally, Wilborn violated 18 U.S.C. § 923(g)(3)(A) and 27
C.F.R. § 478.126(a) when he failed to file multiple-firearm-sales-reports on nine
separate occasions. Doc. 7-4 at 4-5.
In light of these new violations, the ATF served Wilborn with a Notice of
Revocation of License based on his failure to timely record the sale or disposition
of 39 firearms and his failure to file nine multiple-firearm-sales reports. Id. at 2, 4.
Wilborn requested an administrative hearing, docs. 7-5 at 1; 7-8 at 1, which the
ATF held on February 11, 2014, doc. 7-8 at 1. At the hearing, Wilborn admitted
the violations, and acknowledged that he had knowledge of the GCA’s
requirements after the 2011 inspection, that the ATF explained the 2011 violations
to him at a warning conference, and that the ATF notified him by letter that it may
revoke his license if he again violated the GCA. Docs. 7-39 at 10-13,19-22; 7-40 at
1-2, 7-8, 12. Despite his admissions, Wilborn contested the revocation by detailing
the remedial steps he implemented after the 2013 inspection3, and argued that he
had only inadvertently, rather than willfully, violated the GCA. Docs. 7-1 at 1; 7-2
at 1; 7-38 at 21-22; 7-39 at 1-3, 13-17; 7-40 at 13.
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Wilborn implemented a “new, more aggressive check system,” doc. 7-1 at 1, and
requested a firearms records and procedures training seminar at his store, doc. 7-2.
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The hearing officer issued a memorandum to the ATF’s Director of Industry
Operations, finding that a substantial basis existed to believe that Wilborn had
knowledge of the requirements of the GCA and its attendant regulations prior to
the 2013 violations, and that Wilborn’s violations were the result of “purposeful
disregard or plain indifference.” Doc. 7-33 at 8. Based on this finding, Kevin
Boydston, a regional ATF Director of Industry Operations, issued a Final Notice of
Revocation and informed Wilborn that he could petition the court for a review
pursuant to 18 U.S.C. § 932(f)(3). Doc 7-34 at 1-8. Wilborn exercised his right and
filed the petition with this court. Docs. 1, 10.
III. ANALYSIS
The court has before it the ATF’s motion in which it asserts that Wilborn’s
admitted violations rise to the level of willfulness as a matter of law and, therefore,
the Attorney General was entitled to revoke Wilborn’s license. The court agrees
with the willfulness finding.
1. Review under 18 U.S.C. § 923(f)(3)
Title 18 allows a firearms dealer to challenge a revocation by “fil[ing] a
petition with the United States district court for the district in which he resides or
has his principal place of business for a de novo judicial review of such denial or
revocation.” 18 U.S.C. § 923(f)(3). The court’s review is not limited to the record
developed during the administrative appeal, but may include “any evidence
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submitted by the parties to the proceeding whether or not such evidence was
considered at the hearing.” 18 U.S.C. § 923(f)(3). Following the de novo review, if
the court decides that the “Attorney General was not authorized . . . to revoke the
license, the court shall order the Attorney General to take such action as may be
necessary to comply with the judgment of the court.” Id. Under the de novo
standard of review, the ATF’s decision is entitled to no presumption of correctness.
See, e.g. Willingham I, 348 F. Supp. 2d at 1306. In conducting its own review,
although the firearms dealer has no absolute right to an evidentiary hearing before
the court, the court must give the parties an opportunity to present additional
evidence.4 Id.
2. Willfulness of Wilborn’s Violations
The Attorney General can revoke a dealer’s federal firearms license if the
dealer willfully violates the record-keeping or reporting provisions of the GCA. 18
U.S.C. § 923(e). Because Wilborn admits that he violated these regulations, docs.
7-39 at 10-13, 19-21; 7-40 at 12, the dispositive question is whether he did so
“willfully.” A violation is “willful” if it shows “purposeful disregard of or plain
indifference to the laws and regulations imposed on firearms dealers . . . .”

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While the court finds no reason to hold an evidentiary hearing, the court accepts
as part of the record Wilborn’s affidavit, doc. 11-1, which was filed along with his
brief in opposition to summary judgment.
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Willingham Sports II, 415 F.3d at 1277. A licensee’s violations are willful if they
occur “after [he] has been informed of the regulations and warned of violations.”
Id. Factors to weigh in determining “willfulness” include (1) prior knowledge of
the record keeping obligations, (2) repeated failure “to comply with . . . the same or
similar” regulations, and (3) receipt of a warning letter “advising [the licensee] that
repeated violations of the regulations could result in the revocation of its license.”
Id.
Unfortunately for Wilborn, the undisputed facts establish that his actions
satisfy the Willingham II factors. First, Wilborn admitted that he understood the
record-keeping obligations prior to the 2013 citations. Docs. 7-39 at 22; 7-40 at 12. Indeed, the ATF placed Wilborn on notice of his obligations when, in 2011, a
senior ATF official described the nature and severity of the violations. Docs. 7-30
at 1, 3; 7-38 at 14-16. Second, Wilborn repeatedly violated the GCA, as indicated
by his citations in 2011 and 2013 for failing to timely record firearms sales and to
file multiple-firearm-sales reports. Docs. 7-29 at 1, 5; 7-39 at 13. Finally, it is
undisputed that the ATF followed up the 2011 violations with a letter informing
Wilborn that subsequent violations would result in a revocation of his license, and
that he should expect further inspections. Doc. 7-32 at 1-4.

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To support his contention that the ATF cannot demonstrate willfulness,
Wilborn argues that first he has not “repeatedly” violated the GCA because the
ATF only cited him once after the 2011 inspection and warning conference.
Doc.11 at 7-8. According to Wilborn, Willingham Sports II stands for the
proposition that “the ATF must prove that the dealer repeatedly violated the Gun
Control Act ‘after it has been informed of the regulations and warned of
violations.’” Id. at 7 (quoting Willingham Sports II, 415 F.3d at 1277) (emphasis in
original). Basically, Wilborn argues that a licensee must receive more than one
citation after an initial citation in order for the ATF to establish the repeat
violations necessary for a revocation. The court disagrees because “[t]he primary
significance of prior citations is the notice that they give to the licensees of their
responsibilities under the act.” Franklin Gun Shop, Inc. v. Gonzalez, No. 3:05-cv87, 2006 WL 2263992 at *7 (M.D. Ga. Aug. 8, 2006) (summarizing three
representative cases where a Federal Firearms License was revoked after one or
two citations); see also Luna Tech, Inc. v. Bureau of Alcohol, Tobacco and
Firearms, 183 Fed. App’x 863 (11th Cir. 2006) (license was properly revoked
without any indication of prior citations when the ATF proved that the licensee
was aware of regulations before violating them); Nationwide Jewelry and Pawn,
Inc., 455 F. Supp.2d 1379 (M.D. Ga. 2006) (license revoked when licensee
violated the GCA after one prior violation). In other words, because a prior citation
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is a factor evidencing that a licensee possessed knowledge of his obligations, it
follows that a violation occurring after the first citation is evidence that the licensee
willfully disregarded those obligations. Accordingly, the court finds that the ATF
is not required to prove multiple subsequent citations following an initial citation
in order to demonstrate willfulness.
Wilborn argues next that the ATF cannot establish willfulness because he
made reasonable efforts to comply with the GCA, which while “not always
successful . . . ,” demonstrate that his failures were not “purposeful[].” Doc. 11 at 8
(emphasis in original). To bolster his legal argument, Wilborn asserts that his
conduct is “far [less] egregious” than the conduct in Willingham Sports I and II. Id.
at 11. Unfortunately for Wilborn, post-citation efforts to comply with the GCA do
not affect the Attorney General’s authority to revoke his license. Luna Tech, Inc.,
183 Fed. App’x at 855. Likewise, whether Wilborn possessed a “bad purpose or
evil motive,” or indeed whether he violated one or multiple regulations, has no
bearing on the issue of willfulness. Willingham Sports II, 415 F.3d at 1276;
Willingham Sports I, 348 F. Supp. 2d at 1309 n.14. Despite Wilborn’s efforts to
comply with the GCA, the fact remains that Wilborn still committed several
infractions after the ATF placed him on notice the he had to comply with the GCA.
While Wilborn may believe that the ATF’s actions are unduly harsh, the court
simply cannot ignore that the main purpose of the GCA is “to keep firearms away
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from the persons Congress classified as potentially irresponsible and dangerous.”
Barrett v. United States, 423 U.S. 212, 218 (1976). One key way to achieve this
purpose is for licensed dealers like Wilborn to fully comply with the record
keeping requirements of the GCA. As Judge Steele of the Southern District of
Alabama aptly puts it, “[i]f ever there were a statutory scheme where a licensee
should be obligated to ‘sweat the details,’ irrespective of how trifling they may
appear, the GCA would appear to fit that bill.” Willingham Sports I, 348 F. Supp.
2d at 1309 n.14. Wilborn’s failure to fully “sweat the details” is sufficient to vest
the Attorney General with the right to revoke his license.
III. CONCLUSION
For the reasons noted above, the court finds that there is no genuine dispute
of material fact and that Wilborn’s failure to comply with the GCA was willful as a
matter of law. Therefore, the Attorney General possessed the authority to revoke
his license. Accordingly, the ATF’s motion for summary judgment is due to be
granted. The court will enter a separate order consistent with this opinion.
DONE the 30th day of October, 2014.

_________________________________
ABDUL K. KALLON
UNITED STATES DISTRICT JUDGE

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